32.610
Compromising debts
Only designated agency officials—not contracting officers—may compromise contract debts under $100,000, following federal and agency regulations.
Overview
FAR 32.610 addresses the authority and procedures for compromising contract debts owed to the government. It specifies that only designated agency officials—not contracting officers—may compromise debts under $100,000 (excluding interest), and only in accordance with the Federal Claims Collection Standards (31 CFR part 902) and relevant agency regulations. This section ensures that debt compromises are handled consistently and by authorized personnel, protecting government interests and maintaining regulatory compliance.
Key Rules
- Authority to Compromise Debts
- Only designated agency officials may compromise debts under $100,000, following federal and agency-specific standards.
- Contracting Officer Limitations
- Contracting officers are not permitted to compromise debts unless explicitly authorized by agency procedures.
Responsibilities
- Contracting Officers: Must refer debt compromise matters to the designated agency official and avoid unauthorized compromise actions.
- Contractors: Should direct requests for debt compromise to the appropriate agency official, not the contracting officer.
- Agencies: Must ensure proper designation of officials and adherence to federal and agency debt compromise procedures.
Practical Implications
- This section prevents unauthorized compromise of government debts, ensuring only qualified officials make such decisions.
- Contractors should be aware of the correct process and point of contact for debt compromise requests.
- Common pitfalls include contracting officers overstepping their authority or contractors submitting requests to the wrong official.