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Settlements By Agencies At The Administrative Level, Without A Lawsuit
Basically, the Judgment Fund is available for most court judgments and Justice Department compromise settlements of actual or imminent lawsuits against the government. Congress has added a number of administrative claim awards (settlements by agencies at the administrative level, without a lawsuit). Click on statutes authorizing administrative awards. The Judgment Fund has no fiscal year limitations, and there is no need for Congress to appropriate funds to it annually or otherwise. Moreover, disbursements from it are not attributed to or accounted for by the agencies whose activities give rise to awards paid. Absent a specific statutory requirement, the agency responsible is not required to reimburse the Judgment Fund.As a general proposition, the Judgment Fund is available for the payment of final money judgments and awards against the United States which are "not otherwise provided for" (31 U.S.C. 1304(a)(1), i.e. which cannot legally be paid from any existing appropriation or fund. Since agency appropriations generally are not available to pay judgments unless such is affirmatively authorized by law, most judgments against the United States are paid from the Judgment Fund. Some examples of awards which are not paid from the Judgment Fund are tax judgments, judgments against the Postal Service, land condemnation judgments, judgments against government corporations and sue-and-be-sued entities, judgments for refunds where the amount found to have been improperly collected was credited to an agency appropriation, and certain court-awarded contempt citation awards, among others. The fact that the defendant agency may have insufficient funds to cover the award at that particular time does not operate to make the Judgment Fund available.
Payments from the judgment appropriations may be made only upon certification by Financial Management Service, Department of the Treasury. 31 U.S.C. 1304(a)(2). In brief, Treasury's role is to "oversee" the use of this appropriation. The first and most important step in the process is to determine whether a given item is proper for payment under 31 U.S.C. 1304 or whether it is "otherwise provided for," i.e., whether it constitutes an obligation chargeable against agency funds. Thus, Treasury's main function in this area is to determine the proper source of funds, i.e., to make sure the Judgment Fund is not being used for obligations which the agencies should be paying directly.Once this is done, Treasury determines whether the judgment or award is final for payment purposes, calculates the amount of any interest which may be authorized by law, and initiates action to offset any known indebtedness to the United States by the judgment creditor (31 U.S.C. 3728).The actual "certification" step is largely ministerial, in that Treasury does not review the merits of the underlying judgments or settlement. When certification is to be withheld, the requestor is advised informally, before a final denial is issued, in order to assure that all relevent facts and arguments have been considered.
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