A repayment agreement is sent to the EU with the demand letter. The debtor is given two options. One allows the EU to repay with check, money order, or with Food Stamp benefits. The other agreement allows the EU’s Food Stamp benefits to be reduced each month before they are available by benefit reduction. The debtor(s) signs one of the agreements according to the best repayment method for the EU. If the EU chooses to not agree to make repayment and the EU has an active Food Stamp case, benefit reduction is applied. If the repayment agreement is returned with benefit reduction section completed, take no action as the system automatically initiates the benefit reduction. Benefit reduction is also known as recoupment.
If the debtor does not have the original repayment agreement and wishes to enter into a repayment agreement, give the debtor the CARS-7 FOOD STAMP REPAYMENT AGREEMENT. The debtor is given three options. One allows the EU to repay the entire amount with check, money order, or with Food Stamp benefits. The second allows the EU to repay a portion of the debt now using check, money order, or Food Stamp benefits, and the remainder to be paid in monthly payments. The third option allows the EU to set up monthly payments using check or money order. The debtor(s) chooses one of the agreements options according to the best repayment method for the EU.
If the CARS-3 REPAYMENT AGREEMENT or the CARS-7 FOOD STAMP REPAYMENT AGREEMENT is returned with a method of repayment other than recoupment to:
- the county – a person designated by county administration enters the agreement into CARS on the Change Claim (OVCC) screen. Enter the method, frequency, date of the agreement and the amount of the agreed payment. Refer to the CARS CODE SHEET for codes. Record a comment on the Note Add (OVNA) screen regarding the date the agreement was received and details of the agreement.
- the Claims and Restitution Unit – the Claims and Restitution staff enters the agreement into CARS on the Change Claim (OVCC) screen, and returns the original to the county office. Record a comment on the Note Add (OVNA) screen regarding the date the agreement was received and details of the agreement.
For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).
The Repayment Agreement is filed in the CLAIMS SECTION of the case record.
If the EU fails to make a repayment in accordance with the repayment agreement, CARS generates a billing statement. If any responsible member of the EU is receiving food stamp benefits, the system may begin automated recoupment of food stamp benefits.
An individual may request renegotiation of a repayment agreement. If the agency agrees with the request, a new payment is negotiated. The individual signs a new agreement and OVCC is updated. If the agency finds the EU’s economic circumstances have not changed enough for the repayment agreement to be changed, the original repayment amount remains. The request for renegotiation and the reason for the decision is recorded on the Note Add (OVNA) screen.
If the EU is receiving Food Stamp benefits, the repayment agreement cannot be less than the amount that can be recovered with recoupment. The repayment agreement is not renegotiated when the Food Stamp benefit amount changes. Recoupment is the greatest of the repayment agreement amount, the minimum recoupment allowed, or a percentage of the allotment.