REFORMS RELATING TO RECOVERY BY DEPARTMENT OF VETERANS AFFAIRS OF AMOUNTS OWED BY INDIVIDUALS TO THE UNITED STATES.

SEC. 255. REFORMS RELATING TO RECOVERY BY DEPARTMENT OF VETERANS AFFAIRS OF AMOUNTS OWED BY INDIVIDUALS TO THE UNITED STATES.(a) Limitation on Indebtedness Offsets.—Subsection (a) of section 5314 of title 38, United States Code, is amended—(1) by inserting “(1)” before “Subject to”; and (2) by adding at the end the following new paragraph:“(2) The Secretary may not make a deduction under paragraph (1) while the existence or amount of such indebtedness is disputed under section 5314A of this title.” . (b) Administrative Process for Dispute of Existence or Amount of Indebtedness.—(1) Establishment.—Chapter 53 of title 38, United States Code, is amended by inserting after section 5314 the following new section:“§ 5314A. Dispute of indebtedness“(a) Establishment.—The Secretary shall prescribe regulations that establish an administrative process for the dispute of the existence or amount of an indebtedness described in section 136 STAT. 5465 5314(a)(1) of this title (without regard to whether the Secretary has made a deduction under such section regarding such indebtedness). “(b) Standards.—The process under subsection (a) shall be efficient, effective, and equitable. “(c) Timeliness.—The Secretary shall ensure that each dispute under subsection (a) proceeds in accordance with standards for timeliness prescribed by the Secretary under this section. “(d) Limitation.—The Secretary may not submit to any debt collector (as defined in section 803 of the Fair Debt Collection Practices Act (15 U.S.C. 1692a)) any dispute pending under this section. “(e) Rule of Construction.—Nothing in this section shall be construed to modify the procedures for seeking review of a decision of the agency of original jurisdiction described in section 5104C(a)(1) of this title.” . (2) Existing administrative process.—The Secretary of Veterans Affairs shall carry out section 5314A of such title, as added by paragraph (1), by improving the administrative process of the Department of Veterans Affairs for the dispute of the existing or amount of an indebtedness that was in effect on the day before the date of the enactment of this Act. (3) Improvements to department website and notices.—In carrying out paragraph (2), the Secretary shall—(A) improve the website of the Department; and (B) ensure that such website and written notices sent to a person about indebtedness described in section 5314(a) of title 38, United States Code, contain all information a person needs to dispute such an indebtedness, including a description of—(i) the specific actions the person will need to take in order to dispute the indebtedness; (ii) the documentation that will be required for the dispute; and (iii) how the documentation is to be submitted. (4) Clerical amendment.—The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 5314 the following new item: “5314A. Dispute of indebtedness.”. (c) Limitation on Authority To Recover Debts.—Section 5302(a) of title 38, United States Code, is amended—(1) by inserting “(1)” before “There”; and (2) by adding at the end the following new paragraph:“(2) The Secretary may not seek to recover an indebtedness described in paragraph (1) if the Secretary determines that the cost to the Department to recover such indebtedness, as determined when the debt is established, would exceed the amount of the indebtedness.” .