Jason Matthews, DAB CR6927 (2026)

DECISION

Petitioner, Jason Matthews, has been an employee of the Social Security Administration (SSA) since June 27, 2005.  At appointment, he elected to receive Basic, Option A, and Option B (2x) insurance benefits under the Federal Employees’ Group Life Insurance (FEGLI) program.  Due to an administrative error, SSA failed to deduct the Option A and Option B (2x) FEGLI premiums from his biweekly pay from July 24, 2005, through January 10, 2026, resulting in a salary overpayment.  On January 20, 2026, SSA collected a portion of the overpayment debt through salary offset without advance notice.  On April 29, 2026, SSA issued a debt notice letter to Petitioner for the remaining balance due (Debt ID Number M2611900005).  Petitioner filed a timely request for hearing disputing the existence and amount of the alleged debt and the salary offset without advance notice.  For the reasons explained below, I hold that Petitioner is indebted to the United States in the total net amount of $2,219.96.  Therefore, I affirm SSA’s determination that the overpayment debt is valid and accurate.  Although SSA violated Petitioner’s due process rights by failing to provide advance notice of the January 20, 2026, salary offset, I do not order SSA to refund that payment because it is part of Petitioner’s gross debt stemming from his nonpayment of FEGLI premiums and refunding that payment would result in a second debt letter demanding repayment of the refund.

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  I.     Factual Background and Procedural History

Petitioner was appointed to Federal service at SSA on June 27, 2005, or Pay Period 2005-14.  Civil Remedies Division (CRD) Docket (Dkt.) Entry Number (No.) 1b (Hearing Request Supporting Documents) at 18.1  On July 6, 2005, SSA received Petitioner’s Life Insurance Election form to participate in the FEGLI program, which provides term life insurance for federal employees and pays benefits upon death and accidental death or dismemberment.  Id. at 19 (SF-2817, OMB No. 3206-0230); see also SSA Ex. 1 ¶ 3; United States Office of Personnel Management, Federal Employees’ Group Life Insurance (FEGLI) Handbook (OPM Handbook) at 6-7 (June 2019), https://www.opm.gov/healthcare-insurance/life-insurance/reference-materials/publications-forms/feglihandbook.pdf.  The specific amount of premiums that federal employees pay for FEGLI insurance is based on several factors, including the employee’s age, basic salary, among other factors.  Relevant to this case, Petitioner elected “Basic” coverage, which pays an amount approximately equal to his basic salary at death and an additional payment, also approximately equal to his basic salary, if death occurs in a covered accident (Accidental Death & Dismemberment).  Id. at 7-8; see also Request for Hearing Supporting Documents at 19 (Section 3, FEGLI election form).  Petitioner also elected “Option A – Standard” coverage, which pays an additional $10,000 of life insurance, and “Option B – Additional” coverage at two times his salary, on top of Basic coverage.  OPM Handbook at 7; Request for Hearing Supporting Documents at 19 (Section 4, FEGLI election form).  By signing the form, Petitioner authorized deductions from his paychecks to pay his share of the Basic premium and the full cost of the Optional premiums.  Request for Hearing Supporting Documents at 19.  According to the SSA authorizing official who signed Petitioner’s Life Insurance Election form, Petitioner’s FEGLI coverage became effective on July 10, 2005 (or Pay Period 2005-15).  Id.

Over 20 years later, on January 8, 2026, Petitioner discovered a discrepancy in his FEGLI elections on the Government Retirement and Benefits (GRB) Platform and contacted the Office of the Deputy Commissioner, Human Resources (DCHR), Office of Personnel (OPE), by email to inquire about the process for making corrections.  Id. at 21.  Specifically, the GRB Platform indicated Petitioner had FEGLI Basic coverage only, and not the additional Option A and Option B benefits he selected as a new hire.  Id. at 8, 16.

On January 14, 2026, Justine Gower, HR Specialist, Compensation and Benefits, for SSA confirmed the discrepancy in an email, stating that “[a]ll of our systems, including GRB,

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reflect that you are enrolled in Basic Only FEGLI.”2  Hearing Request Supporting Documents at 1; see SSA Ex. 1 ¶ 6.  According to Ms. Gower, the error occurred when SSA processed Petitioner’s Life Insurance Election form at the time he was hired in 2005.  Petitioner was automatically enrolled in FEGLI Basic Only coverage at hire, and a Federal Personnel and Payroll System (FPPS) personnel action created on July 12, 2005, automatically pulled Petitioner’s initial FEGLI enrollment as Basic Only.  SSA Ex. 1 ¶¶ 2, 5.  A subsequent payroll action created on July 13, 2005, to enroll Petitioner in his FEGLI Option A and Option B elections was “incorrectly backdated to be effective on July 10, 2005,” and nullified in FPPS.  SSA Ex. 1 ¶¶ 4-5; Request for Hearing Supporting Documents at 1.

On January 14, 2026, Ms. Gower also confirmed that she processed Petitioner’s FEGLI enrollment correction action to reflect “the election on file, as required by the Office of Personnel Management (OPM)/FEGLI regulations.”  Request for Hearing Supporting Documents at 1; see also SSA Ex. 1 ¶ 6.  Ms. Gowers stated that “[u]nfortunately, this is going to generate a debt . . .”  Request for Hearing Supporting Documents at 1.  “The change from Basic only to Basic, Option A, and Option B with two times salary dating back to July 10, 2005, caused Jason Matthews to be overpaid because the appropriate amount of FEGLI premiums were [sic] not deducted from his salary since 2005.”  SSA Ex. 1 ¶ 7.  Ms. Gower further explained:

Our system can automatically calculate the amount of the debt going back for the most recent 52 pay periods. The remainder will need to be manually

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calculated by our payroll provider, the Department of the Interior [(DOI)], so that will take some time.

Hearing Request Supporting Documents at 1.

Petitioner’s paycheck for Pay Period 2026-02, ending January 10, 2026, and paid on January 20, 2026, included “Adjusted” deductions of $28.80 for “FEGLI – Optional” and $746.88 for “FEGLI – Additional,” totaling $775.68.  Request for Hearing Supporting Documents at 10.  Petitioner’s paycheck also included “Current” deductions for FEGLI – Regular, FEGLI – Optional, and FEGLI – Additional in the amounts of $21.60, $0.60, and $15.96, respectively.  Id.

From January 14, 2026, through January 26, 2026, Petitioner and the Acting Division Director of Law & Policy Operations, where Petitioner works, corresponded by email with several HR officials, including Ms. Gowers, concerning Petitioner’s retroactive FEGLI enrollment corrections and paycheck adjustments.  See Request for Hearing Supporting Documents at 1-17; SSA Ex. 2 at 1-6.  Both expressed concern that retroactive corrections dating back to Petitioner’s start date had been implemented without prior notification, resulting in approximately $700 in deductions from his paycheck.  Hearing Supporting Documents at 6; SSA Ex. 2 at 5.  Petitioner explained that the deductions from his paycheck had caused a financial hardship and raised due process and equity concerns, particularly because the overpayments were the result of an administrative error on the part of SSA HR, and not due to any fault on his part.  SSA Ex. 2 at 3, 5.  Petitioner requested an immediate refund of the $791.643 deducted from his paycheck for Pay Period 2026-02.  Id. at 3.  He also requested guidance on his appeal rights and available remedies, such as the applicable appeals process, requesting waiver of the alleged debt, and adjusting the corrected effective date to January 2026 (when he discovered the FEGLI enrollment error).  Id.  The Acting Division Director also requested the outstanding balance due and the negotiation of a payment plan on Petitioner’s behalf.  Id. at 5-6.

Ms. Gower explained that, after the manual calculations are completed, DOI will send Petitioner a letter regarding the debt, including information on Petitioner’s rights and responsibilities and how to request a waiver from HR Policy or the Office of General Counsel.  Hearing Request Supporting Documents at 5, 7, 13; SSA Ex. 2 at 2, 4.  In response to the January 20, 2026, deductions without prior notification, Ms. Gower

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informed Petitioner that “DOI is supposed to notify an employee before making any deductions,” and he may request a “Paid Daily” to obtain a refund.  Hearing Request Supporting Documents at 5, 12; SSA Ex. 2 at 1.  However, obtaining a Paid Daily refund will affect the amount of the outstanding debt.  If Petitioner does not request a Paid Daily, “the debt will continue to be partially collected via payroll, and the manual bill will be smaller.”  Hearing Request Supporting Documents at 5, 12; SSA Ex. 2 at 1.  If Petitioner does request a Paid Daily, then “the manual bill will be higher.”  Hearing Request Supporting Documents at 5, 12; SSA Ex. 2 at 1.  Ms. Gower asked Petitioner to inform her which option Petitioner preferred.  Hearing Request Supporting Documents at 12; SSA Ex. 2 at 1.  Petitioner did not request a Paid Daily.  SSA Ex. 1 ¶ 8.

On April 29, 2026, SSA issued a letter informing Petitioner that “[SSA] records show that you have an overpayment of pay.  This debt is the result of you owing certain deduction(s) retroactively.”  CRD Dkt. Entry No. 1a.  The letter identified the alleged debt as Debt ID # M2611900005, listed a debt balance of $2,219.96 for retroactive FEGLI deductions, stated that “$0.00” had been collected, and demanded full payment of the alleged debt within 30 days to avoid the assessment of interest and penalties.4  Id. at 1, 4.  Accompanying the letter were various notices, including a description of the debt collection process, Petitioner’s right to negotiate a repayment plan, Petitioner’s right to request a hearing to dispute the existence and amount of the alleged debt, and Petitioner’s right to seek waiver of the debt.  Id. at 2, 3-9.

On May 8, 2026, Petitioner filed a timely Request for Hearing disputing the existence and amount of the alleged debt.  CRD Dkt. Entry No. 1 (Request for Hearing) at 1.  He also contests the repayment schedule in that he alleges that salary offsets have already been collected.  Id. at 2-3.  Finally, Petitioner argues that “[i]t is unjust to hold [him] liable for a debt originating from the agency’s error.”  Request for Hearing at 3.  In his Request for Hearing, Petitioner requests the following remedies:

1. Complete removal of the debt from [his] records to ensure that [he is] not held liable for an error originating from the agency’s administrative mistake.

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2. A full refund equal to the total amount withdrawn from [his] paycheck, including any taxes or other deductions associated with the erroneous payroll action.
3. Confirmation that this issue is fully resolved and that no further adverse actions, such as accrual of interest or additional deductions, will be taken.

Id. at 2. 

On May 19, 2026, I issued an Acknowledgment, Prehearing Order and Notice of Oral Hearing or Paper Hearing establishing deadlines for the parties’ prehearing submission of arguments and evidence and scheduling an oral hearing.  CRD Dkt. Entry No. 2.  On May 21, 2026, SSA objected to the hearing date due to its witness’ unavailability, and the hearing was rescheduled to June 25, 2026.  CRD Dkt. Entry Nos. 5, 8.

In accordance with my May 19, 2026, Order the parties submitted timely prehearing exchanges, and SSA submitted a timely responsive brief with objections.5  CRD Dkt. Entry Nos. 10, 11, 11a-c, 12-14, 14a-h, 15-19.  Upon review of the parties’ submissions, I determined that the administrative record was incomplete.  Therefore, I issued an order on June 17, 2026, directing Petitioner to submit a missing exhibit that is listed on his exhibit list.  CRD Dkt. Entry No. 20 at 2-3.  The June 17, 2026, Order also directed SSA to submit the complete Overpayment Audit Report identified as Exhibit 6 to the corrected debt notification letter and any debt‑calculation worksheet for the alleged overpayment, any underlying records forming the basis of the alleged overpayment, Petitioner’s missing Earnings and Leave Statements (ELSs) for Pay Periods 2026-01 (ending December 27, 2025) through Pay Period 2026-11 (ending May 16, 2026) to determine if any additional payments of the alleged debt had been collected, and any underlying records accounting for such deductions in the debt calculation.  Id. at 2-3. On June 24, 2026, the parties supplemented the record with the missing documents requested in my June 17, 2026, Order.  CRD Dkt. Entry Nos. 21-22, 22a-b, 23-24.

On June 25, 2026, I presided over an oral hearing, in the form of an informal conference or meeting.  Present at the hearing were:  Petitioner; Patricia Stewart and Jennifer Patel, counsels appearing on behalf of SSA; SSA’s witness, Justine Gower, HR Specialist; and Jamil Lawrence, CRD Attorney Advisor assisting me on this case.  I reviewed the issues in the case and acknowledged receipt of the parties’ prehearing exchanges, including

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SSA’s responsive brief, and the parties’ supplemental submissions in response to my June 17, 2026, Order.  As neither party objected, I admitted both parties’ exhibits into the administrative record as SSA Exhibits (Exs.) 1-5 and Petitioner Exhibits 1-12.

At the hearing, I also ruled on the two objections raised in SSA’s responsive brief.  CRD Dkt. Entry No. 19 (SSA Responsive Brief & Objections) at 1-2.  I sustained SSA’s objection to Petitioner’s waiver request, ruling that I do not have jurisdiction to waive the alleged overpayment debt.  However, I overruled SSA’s objection to Petitioner’s arguments regarding the $775.68 deduction from Petitioner’s pay on January 20, 2026.  SSA argued in its responsive brief that I lack jurisdiction because Petitioner did not request a Paid Daily reimbursement and had not received a debt letter concerning that deduction.  However, I ruled that I have jurisdiction over the deduction because Petitioner claims the deduction was a premature collection of the debt without advance notice, and, therefore, Petitioner contests the repayment schedule for the alleged debt.  Additionally, the deduction is relevant to determining the nature and net amount of the alleged overpayment at issue in this case.

During the hearing, Petitioner and Ms. Gower provided sworn testimony concerning the facts and circumstances giving rise to the alleged overpayment, the January 20, 2026, salary deductions, and the opportunity for Petitioner to request a Paid Daily refund.  Petitioner and SSA counsel also provided oral presentations.  Ms. Stewart used an FPPS screenshot demonstrative during her presentation, which Petitioner confirmed at the hearing that he did not object to its admission to the record.  Therefore, I ordered Ms. Stewart to submit the FPPS screenshot demonstrative as SSA Exhibit 6 after the hearing.  During the hearing, Ms. Stewart also offered to obtain a detailed calculation of the January 20, 2026, deductions.  I also ordered Ms. Stewart to submit the calculation document, if available.  SSA filed a second amended exhibit list and the requested demonstratives as SSA Exhibits 6 and 7 after the hearing on June 25, 2026.  CRD Dkt. Entry Nos. 25, 25a-b.

On June 26, 2026, audio recordings of the hearing were uploaded to the record on DAB E-File.  CRD Dkt. Entry Nos. 26-27.  On June 29, 2026, SSA resubmitted SSA Exhibit 6, which had been mistakenly omitted on June 25, 2026.  CRD Dkt. Entry No. 29.

The record is now complete and ready for a decision.

  II.     Issues

Pursuant to 20 C.F.R. § 422.810(e)(2)(ii), the issues to be decided in this case are:

1. Whether Petitioner owes a debt to the United States government; and

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2. If so, whether Petitioner owes a gross total of $2,219.96; and
3. Whether the terms of the repayment schedule are appropriate.

  III.     Jurisdiction

The three issues identified above are the only appealable issues regarding a salary overpayment matter.  5 U.S.C § 5514(a)(2)(D); 20 C.F.R. §§ 422.810(e)(2)(ii), (f)(1)(vii), (h)(4)(ii).  The statute authorizing these proceedings specifies that the head of an agency may appoint an administrative law judge to adjudicate an employee’s appeal of an alleged debt.  See 5 U.S.C. § 5514(a)(2); see also 20 C.F.R. § 422.810(d) (definition of Hearing Official, (i)(1).  SSA maintains an interagency agreement under which administrative law judges with the Department of Health and Human Services, Departmental Appeals Board (DAB), Civil Remedies Division, adjudicate SSA federal salary overpayment cases.  See Portia L. Pierce, DAB CR2049 at 5 (2009); Jan Donsbach, DAB CR1536 (2006).

  IV.     Rulings

1.     SSA’s objection to Petitioner’s waiver request is sustained.

Petitioner’s hearing request and prehearing brief include a request for waiver and raise several equitable arguments for waiving the overpayment debt.  For example, Petitioner argues that it is “unjust to hold [him] liable for a debt originating from the agency’s error.”  Request for Hearing at 3.  Petitioner also argues that he acted promptly and in good faith when he discovered the FEGLI enrollment error, and the January 20, 2026, deductions resulting from the agency’s corrective action were implemented without advance notice and caused Petitioner financial hardship.  Id. at 2.

SSA objects to Petitioner’s waiver request, stating that Petitioner’s waiver request is misplaced.  SSA’s Responsive Brief & Objections at 1.

As explained above, I sustained SSA’s objection at the hearing.  Although I sympathize with Petitioner, a hearing request under 5 U.S.C. § 5514 and a waiver request under 5 U.S.C. § 5584 are “distinct, but not mutually exclusive methods of seeking relief from the agency’s intended action” to collect a debt from a federal employee.  Petra A. Illig, M.D., DAB CR2559 at 2 (2012).  My jurisdiction is limited to determining the existence, amount, and repayment schedule of an alleged debt.  While fault and other equitable considerations are factors in determining whether to waive a debt owed by a federal employee, they are not factors in this proceeding.  Decisions on whether to waive an employee’s overpayment debt are determined solely by SSA.  See, e.g., SSA Ex. 2 at 2 (explaining that Petitioner’s waiver request should “be directed to one of two areas, either HR Policy or the Office of General Counsel, depending on the total amount of the

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debt.”).  Therefore, I have no jurisdiction to decide Petitioner’s waiver request.  See Alfred H. Varga, DAB CR342 at 1-3 (1994).  I encourage Petitioner to submit his waiver request through the appropriate channels at SSA, especially given Petitioner’s equitable arguments and lack of fault.  Exhibit 4 to Petitioner’s debt letter provides instructions and requirements for submitting a waiver request to Petitioner’s Servicing Personnel Office.  See, e.g., CRD Dkt. Entry No. 1a at 7.

2.     SSA’s objection to Petitioner’s arguments regarding SSA’s January 20, 2026, debt collection is overruled.

Petitioner argues that the overpayment collection from his January 20, 2026, paycheck should be refunded because he did not receive advance notice or an opportunity to contest the recovery.  Petitioner Prehearing Br. at 1-2.

SSA objects to Petitioner’s arguments regarding the $775.68 deduction from Petitioner’s pay in January 20, 2026, stating that the deduction falls outside of my jurisdiction because Petitioner did not request a “Paid Daily” reimbursement and receive a debt letter concerning that deduction.  SSA’s Responsive Brief & Objections at 1-2.

I overruled SSA’s objections at the hearing.  I have jurisdiction over the deduction insofar as I must determine the nature and amount of the alleged overpayment at issue in this case.  Ms. Gower’s testimony and documentary evidence in the record establishes that the January 20, 2026, deductions were the direct result of SSA retroactively correcting Petitioner’s FEGLI enrollment elections back to 2005 and its payroll system’s automatic calculation and collection of Petitioner’s unpaid premiums from the most recent 52 pay periods.  Additionally, it is disingenuous to claim that I lack jurisdiction because SSA failed to discharge its statutory obligation to issue a debt letter and provide Petitioner advance notice before collecting the debt by salary offset.

3.     All exhibits proposed by SSA and Petitioner are admitted into the record.

I admitted the parties’ prehearing exchange evidence at the hearing, which took place on June 25, 2026.  SSA’s prehearing evidence consists of a prehearing brief, exhibit list, witness list, responsive brief with objections, response to my June 17, 2026, order (CRD Dkt. Entry No. 20), amended exhibit list, and five proposed exhibits (SSA Exs. 1-5), including the Declaration of Justine Gower, SSA Human Resources Specialist, Compensation and Benefits (SSA Ex. 1).  CRD Dkt. Entry Nos. 10-11, 11a-c, 12, 19, 21-22, 22a-b.  Petitioner’s prehearing evidence consists of a prehearing brief, exhibit list, response to my June 17, 2026, order, and 12 proposed exhibits, which I renumbered to correspond with the numbers on Petitioner’s exhibit list (P. Exs. 1-12).  CRD Dkt. Entry Nos. 13-14, 14a-h, 15-18, 23-24.

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As explained above, SSA’s counsel presented a demonstrative screenshot of the FPPS used by DOI to explain the system’s automatic FEGLI deduction for Petitioner’s January 20, 2026, paycheck.  At the hearing, SSA’s counsel also offered to obtain a breakdown on the January 20, 2026, deduction.  I ordered SSA’s counsel to submit the FPPS screenshot and deduction breakdown as exhibits after the hearing.  Petitioner did not object to the admission of either document, therefore, I admitted both documents at the hearing.  After the hearing, SSA’s counsel submitted a second, amended exhibit list, the FPPS screenshot as SSA Ex. 6, and the breakdown as SSA Ex. 7.  CRD Dkt. Entry Nos. 25, 25a-b, 28-30.

I confirm my rulings at the hearing and admit SSA Exhibits 1-7 and Petitioner Exhibits 1-12 into the administrative record.  These exhibits, as well as Petitioner’s Request for Hearing (CRD Dkt. Entry Nos. 1, 1b), the debt letter and amended debt letter (CRD Dkt. Entry Nos. 1a, 6), audio recordings of the hearing (CRD Dkt. Entry Nos. 26-27), and other documents filed in this proceeding constitute the complete administrative record.

  V.     Applicable Law

If SSA determines that a current SSA employee is indebted to the United States government, SSA may offset the debt from that employee’s salary.  5 U.S.C. § 5514(a)(1); 20 C.F.R. § 422.310(a).  Before SSA offsets the debt, however, it must provide 30 days written notice to the employee concerning the nature and amount of the debt, its intent to collect the debt through salary offset, and the employee’s due process rights.  20 C.F.R. § 422.810(f)(1).  Among others, the employee has the right to request a hearing before an administrative law judge in order to dispute the existence of the debt, the amount of the debt, and/or the payment schedule established by the agency.  5 U.S.C. § 5514(a)(2); 20 C.F.R. § 422.310(c)(6).

The administrative law judge will make a determination after an oral or paper hearing.  20 C.F.R. § 422.810(h)(3)(ii)-(iii).  An oral hearing consists of an informal meeting or conference where testimony is taken under oath.  20 C.F.R. § 422.810(h)(3)(ii).  A paper hearing is based on the documentary evidence in the record.  20 C.F.R. § 422.810(h)(3)(iii).  The administrative law judge must issue a written decision no later than 60 days after SSA receives the employee’s request for hearing.  20 C.F.R. § 422.810(h)(4)(i).  The written decision must include findings of fact, analyses, and conclusions of law concerning the existence and amount of the debt, including its origin and nature, and the terms of any repayment schedule, if applicable.  20 C.F.R. § 422.810(h)(4)(ii).

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  VI.     Analysis and Conclusions of Law

1.     Petitioner owes a debt to the United States Government due to unpaid FEGLI premium payments from Pay Period 2005-16 through Pay Period 2026-01.

I find that the alleged overpayment debt is valid because SSA failed to accurately process Petitioner’s FEGLI – Optional and FEGLI - Additional enrollment elections in July 2005.  As a result, SSA failed to deduct the corresponding premiums from Petitioner’s paychecks, beginning with Pay Period 2005-16 through Pay Period 2026-01, when SSA finally corrected Petitioner’s FEGLI enrollment elections.  The record establishes that Petitioner elected to receive FEGLI – Basic, FEGLI – Optional, and FEGLI – Additional (2x salary) life insurance benefits at the time he was hired.  Hearing Request Supporting Documents at 19.  However, SSA delayed processing Petitioner’s FEGLI enrollment and enrolled Petitioner in FEGLI – Basic Only due to an HR processing error.  Id. at 1; SSA Ex. 1 ¶¶ 2-5.  Specifically, SSA erred in attempting to back-date Petitioner’s FEGLI elections to July 10, 2005, the original effective date of Petitioner’s FEGLI elections had SSA timely processed Petitioner’s Life Insurance Enrollment form.  See OPM Handbook at 8 (“Option A [FEGLI – Optional] and Option B [FEGLI – Additional] insurance coverage [are] effective on the first day you are in a pay and duty status on or after the day your employing office receives your election.”) (emphasis added).  Because of SSA’s delay, however, the effective date should have been the following pay period, beginning July 24, 2005 (Pay Period 2005-16).6

At the hearing, Petitioner argued that the debt does not exist because he did not receive the FEGLI – Optional and FEGLI – Additional coverage that SSA failed to process.  He contends that, had he died prior to January 2026, his beneficiaries would not have received the extra life insurance benefits because SSA did not enroll him and collect the requisite premiums.  I reject Petitioner’s arguments.  Although I share Petitioner’s concerns that his beneficiaries may not have received his FEGLI – Optional and FEGLI – Additional insurance benefits because of SSA’s processing error, SSA’s failure to collect Petitioner’s premiums “represents an overpayment of salary” to Petitioner.  OPM Handbook at 71.  Additionally, SSA is still responsible for paying the premiums to OPM that should have been deducted from Petitioner’s pay, regardless of whether SSA decides to waive the overpayment debt because Petitioner is “without fault and recovery would be against equity and good conscience.”  Id.

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I also reject Petitioner’s argument that his FEGLI enrollment elections should be effective January 2026.  As Ms. Gower explained in an email dated January 21, 2026, OPM requires SSA to correct the enrollment in the FPPS system so that it reflects the election form that Petitioner completed, even when it generates a debt.  Hearing Request Supporting Documents at 5.  Further, “[i]f the correction involves the election of new coverage, the effective date is the same as if the error had not happened.”  OPM Handbook at 18.  Additionally, if the correction provides retroactive coverage, SSA must remit the corresponding premiums to OPM.  Id.

In summary, I concluded that Petitioner received an overpayment of salary due to SSA’s failure to collect his FEGLI – Optional and FEGLI – Additional premiums from Pay Period 2005-16 through Pay Period 2026-01.

2.     Petitioner owes a total net debt of $2,219.96

When SSA corrected Petitioner’s FEGLI – Optional and FEGLI – Additional elections, the payroll system automatically calculated and collected $775.68 from Petitioner’s paycheck for Pay Period 2026-02.  Request for Hearing Supporting Documents at 10 (documenting SSA’s “Adjusted” deductions for FEGLI – Optional and FEGLI – Additional).  This amount is referred to as “System Debt” and represented Petitioner’s unpaid FEGLI – Optional and FEGLI – Additional premiums for the most recent 52 pay periods, i.e., Pay Periods 2024-02 through 2026-01.  SSA Ex. 7; see also SSA Ex. 4 at 13 (stating that the “system debt” was “Deducted from PP2602.”); Request for Hearing Supporting Documents at 10.  SSA also began collecting Petitioner’s current premiums at Pay Period 2026-02.  Request for Hearing Supporting Documents at 10 (documenting SSA’s “Current” deduction for Petitioner’s FEGLI – Optional and FEGLI – Additional insurance premiums); see also SSA Ex. 5 at 3-18 (same).

Subsequently, DOI manually calculated the remaining, uncollected premiums due from Petitioner for the timeframe covering Pay Period 2005-167 through Pay Period 2024-01, which totaled $2,219.96.  SSA Ex. 4 at 13.  Thus, based on the evidence in the record, Petitioner initially owed a total, gross debt of $2,975.64, including $775.68 in “System Debt” and $2,219.96 in “Manual Debt” of unpaid FEGLI – Optional and FEGLI – Additional insurance premiums.  Since the System Debt totaling $775.68 has already been collected from Petitioner, the remaining, net debt owed by Petitioner is the uncollected Manual Debt, totaling $2,219.96.  Hearing Request Supporting Documents at 10; SSA Ex. 4 at 12-13.

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3.     Petitioner’s due process rights were violated because a portion of the debt was collected without prior notice.

SSA improperly processed the $775.68 salary offset related to Petitioner’s FEGLI overpayment debt without providing the mandatory, statutory notice under 5 U.S.C. § 5514(a); see also 20 C.F.R. § 422.803(a) (“We will send an initial written demand for payment no later than 30 days after an appropriate official determines that a debt exists.”).  Hearing Request Supporting Documents at 10.  I agree with Petitioner that, “[a]bsent proper notice and an opportunity to understand and respond, the deduction was premature.”  SSA Ex. 2 at 3.  Petitioner was entitled to 30 days advance notice and an opportunity to review, dispute, or negotiate a payment plan before SSA collected any of the debt through salary offset.

Debts owed to the United States by a federal employee may be collected in installments from the employee’s pay account, subject to the provisions of 5 U.S.C. § 5514.  Before an agency head may direct collection of indebtedness from an employee’s salary, however, the employee must be given written notice a minimum of 30 days prior to any attempt to collect the debt.  20 C.F.R. § 422.810(f)(1).  The notice must inform the employee of the nature and amount of the debt determined to be due; the intention of the agency to effect collection through deduction from the employee’s pay; and the notice must explain the employee’s rights under 5 U.S.C. § 5514.  Id.  The employee must:  1) be given the opportunity to inspect and copy government records related to the debt; 2) offered an opportunity to enter a written agreement agreeable to the agency head establishing a repayment schedule; and 3) given the opportunity for a hearing on the determination of the agency regarding the existence or the amount of the debt and any repayment schedule not established by written agreement.  20 C.F.R. § 422.810(g)-(h), (j)(1)(i).  Collection of any amount must be in accordance with standards promulgated pursuant to 31 U.S.C. §§ 3711 and 3716 through 3718.  5 U.S.C. § 5514(a)(4).  There are exceptions to the notice and collection stay requirements, but none apply here.  5 U.S.C. § 5514(a)(3).  Accordingly, Petitioner’s due process rights were violated.

Finally, I must determine “whether the employee’s petition for hearing was baseless and resulted from an intent to delay the creditor agency’s collection activity.”  20 C.F.R. § 422.810(h)(4)(ii)(B).  I find that Petitioner did not file a baseless request for hearing, nor did he dispute the debt with the intention of delaying SSA’s collection activity.  There is no indication in the record that Petitioner sought to delay payment of the debt, but rather, undertook efforts to understand the existence, nature, calculation, and SSA’s partial recovery of the debt.

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  VII.     Conclusion

Petitioner is indebted to the United States government in the gross amount of $2,975.64 and has a net balance due of $2,219.96 after SSA collected $775.68 to recover Petitioner’s unpaid FEGLI – Optional and FEGLI – Additional insurance premiums.  This is the final agency decision pursuant to 5 U.S.C. § 5514(a)(2)(D).