Administrative Procedure 8.621 Administrative Procedure 8.621

Delinquent Financial Obligation Tax Setoff Hearings

Administrative Procedure Chapter 8, Business and Finance
Administrative Procedure AP 8.621, Delinquent Financial Obligation Tax Setoff Hearings
Effective Date:  October 2016
Prior Dates Amended:  December 2003
Responsible Office:  Office of the Vice President for Budget and Finance/Chief Financial Officer
Governing Board and/or Executive Policy:  EP 1.102, Authority to Manage and Control the Operations of the Campus
Review Date:  October 2019

To provide the guidelines and procedures for conducting hearings involving the Setoff of a Person's Delinquent Financial Obligation against the Person's income tax refund or any other sum owed to the Person from the State.    The procedures are based on Hawai‘i Revised Statutes Chapter 91 and Sections 231-51 to 231-59, Hawai‘i Administrative Rules Chapter 20-10 and applies to appeals of tax Setoffs at all campuses of the University of Hawai‘i.

A.    Appeal - The request for a hearing to contest the Setoff of a Person' s Delinquent Financial Obligation against the Person' s income tax refund or any other sum owed to the Person from the State.

B.    Board - The Board of Regents of the University of Hawai‘i and shall include its authorized designees.

C.    Claimant - The University program which initiates the utilization of the Setoff procedures.

D.    Contested Case - The administrative case involving the Setoff of a Person 's Delinquent Financial Obligation against the Person' s income tax refund or any other sum owed to the Person from the State.

E.    Debtor - A Person owing a debt to the University.

F.    Delinquent Financial Obligation - Past due on a financial obligation of the University of Hawai‘i, or failing to pay for tuition and fees by a published deadline.

G.    Designee - A Person designated or appointed by the University for a specific purpose or duty.

H.    Hearing Officer - A Person duly designated by the President or the President’s designee to preside over hearings involving tax Setoff.

I.    Party - A Person that participates in an appeal hearing or a Contested Case hearing as a Person filing the appeal, a business office, a debtor, or a Claimant.

J.    Person - An individual, corporation, partnership, association, or any trustee, assignee, receiver, or legal successor thereof.

K.    President - The President of the University of Hawai‘i and shall include the President's authorized Designees.

L.    Setoff - The application of Person's income tax refund or any other sums due to the Person from the State, to a valid debt owed to the University.

M.    University - The several institutions, collectively or individually, which fall under the jurisdiction of the Board of Regents of the University of Hawai‘i.

A.    Procedure for Setoff

    1.    When a University Claimant would like to request the Setoff of a Person’s debt against a Person’s refund, the Claimant shall submit the request to the appropriate business office.

    2.    The business office shall submit the Setoff request to the Comptroller of the State Department of Accounting and General Services.

    3.    The Comptroller shall issue a written notice to the Debtor of the State’s intention to apply the Debtor’s refund as possible payment to the debt owed to the University.  The notice shall state that the Debtor, within thirty days of the date of the notice, may request an administrative hearing to contest the Setoff.  In the case of a joint refund, the Debtor’s spouse may also request a hearing. 

    4.    The request for an administrative hearing shall be submitted to the Financial Management Office in writing not more than thirty days from the date of the Comptroller’s notice of Setoff.  The Director of the Financial Management Office may extend the time for the submission of the hearing request upon good cause shown.

B.    Administrative Hearings to Contest the Setoff

    1.    Upon receipt of a written request for hearing, the Financial Management Office shall send the request to the Hearing Officer.

    2.    The Hearing Officer shall issue a written notice of hearing to both the Debtor and the Claimant at least fifteen days prior to the hearing.  The notice shall include the following information:

        a.    The date, time, place, and nature of the hearing.

        b.    The legal authority under which the hearing is to be held.

        c.    The statutes and rules involved.

        d.    A statement of the issues involved and the facts alleged by the Claimant.

        e.    That the Contested Case is limited to issues not previously contested by the Debtor.

        f.    The fact that any Party may retain counsel if so desired.

    3.    The Hearing Officer shall provide all Parties with the opportunity to present evidence and argument on all issues involved.

    4.    Any procedure in the Contested Case may be modified or waived by agreement of the Parties and informal settlement of the case may be accomplished by agreement of the Parties.

    5.    To preserve a record of the Contested Case, the Hearing Officer shall have the proceedings recorded.

    6.    The case record shall include:

        a.    All pleadings, motions and rulings.

        b.    Evidence, including oral testimony, exhibits, and other official documents.

        c.    Answers that would have been given if the other Party had not objected to the questions.

        d.    Proposed findings and exceptions.

        e.    Report of the Hearing Officer who presided at the hearing.

        f.    Staff memorandums submitted to the Board’s Designee, Vice President for Budget/Finance and Chief Financial Officer, in connection with the case.

    7.    Within a reasonable time, the Hearing Officer shall issue a proposed decision on the Contested Case as a recommendation for the Board‘s Designee, Vice President for Budget/Finance and Chief Financial Officer.

    8.    No matters outside the record shall be considered by the Hearing Officer in making the proposed decision.

    9.    Every decision rendered by the Hearing Officer shall be in writing and shall include the reasons for the decision.

    10.    A copy of the proposed decision shall be mailed or delivered to each Party or to the Party’s attorney of record.

    11.    If the Debtor is adversely affected by the proposed decision, the Hearing Officer shall send a notice stating that the Debtor may file written exceptions to the proposed decision and present argument to the Board’s Designee, Vice President for Budget/Finance and Chief Financial Officer, before a final decision is rendered.  The written exceptions shall be filed with the Financial Management Office not more than fifteen days from the date of the proposed decision.

C.    Rules of Evidence

    1.    Any oral or written evidence may be received by the Hearing Officer.  For written evidence, copies may be submitted.  However, upon request, the Parties shall be given the opportunity to compare the copy with the original.

    2.    Every Party shall have the right to cross-examine the other Party in order to obtain a full and true disclosure of the facts, and shall have the right to submit rebuttal evidence.

D.    Final Decision Making for the University in a Contested Case Hearing.

    1.    The final decision for the University shall not be made by the Board until the Hearing Officer‘s proposed decision has been mailed or delivered to each Party or to the Party’s attorney of record.

    2.    If the Debtor is adversely affected by the proposed decision and has filed written exceptions to the proposed decision, then the Board shall provide the Debtor with an opportunity to present written and oral arguments before a final decision is rendered.

        a.    The final decision in a Contested Case of less than $500,000 shall be rendered by the Board’s Designee, Vice President for Budget/Finance and Chief Financial Officer.

        b.    The final decision in a Contested Case of $500,000 or more shall be rendered by the Board.

    3.    In rendering the final decision for the University, the Board shall consider the whole record of the Contested Case or the portions cited by the Parties.  No matters outside the record shall be considered by the Board in making a decision.

    4.    Every decision rendered by the Board shall be in writing and accompanied by findings of fact and conclusions of law.

    5.    Both the Debtor and the Claimant shall be notified of the Board’s final decision by mailing or delivering the final decision to each Party or to the Party’s attorney of record.

E.    Consultation by Decision Making Officials

The hearing officer, Board member or Designee, or any other Person who is likely to advise these officials in the decision on the Contested Case is prohibited from discussing the case with any interested Party not performing a decision making function, except where:

    1.    Notice is given to both the Debtor and the Claimant providing an opportunity for all Parties to participate in the discussion; or

    2.    Consultation is required for matters authorized by law or the consultations are covered by the attorney-client privilege.

F.    Appeals from the Final Decision

Appeals from the final decision of the Board or its Designee shall be held in accordance with Hawaii Revised Statutes Chapter 91.

There is no specific administrative delegation of authority.

    
General Accounting and Loan Collection, 956-8278, or uhgalc@hawaii.edu
Website:  http://www.fmo.hawaii.edu/general_accounting/index.html

A. Link to superseded Executive Policies in old format https://www.hawaii.edu/policy/archives/ep/

B. Link to Administrative Procedures in old format https://www.hawaii.edu/policy/archives/apm/sysap.php

None

    Vice President for Budget and Finance/Chief Financial Officer