FR 2025-00583

The Office of Personnel Management (OPM) has released an interim final rule regarding the appeal procedures for recouping awards, bonuses, or relocation expenses from Department of Veterans Affairs (VA) employees. This regulatory update stems from the Department of Veterans Affairs Accountability and Whistleblower Protection Act of 2017, which allows both current and former VA employees to challenge the VA's decision to demand repayment. This typically happens when misconduct or errors in payment authorization are suspected.

The interim rule establishes a framework for how these appeals should be processed, emphasizing adherence to established recoupment policies and legal procedures rather than reevaluating the merits of disciplinary actions themselves. Public comments on the rule are invited until March 17, 2025. This opportunity allows for stakeholder feedback and aims to refine the appeal process to ensure fairness and transparency.

Significant Issues and Concerns

The document presents several concerns that could impact its effectiveness. One notable issue is the rule's complexity, which could make it difficult for affected individuals to understand the procedures. The language could potentially be simplified to enhance accessibility, ensuring that all involved parties have a clear grasp of their rights and obligations.

Moreover, it remains unclear whether VA employees have the option to pursue a negotiated grievance process, rather than the outlined appeal procedures, which introduces ambiguity in their procedural rights. Additionally, the document does not clearly address whether employees can seek judicial review of OPM's final decisions. This lack of clarity might leave employees uncertain about their ultimate rights under these regulations.

Impact on the Public

For the general public, this regulation primarily affects a specific segment—current and former VA employees impacted by award, bonus, or relocation expense recoupment. However, it underscores wider concerns about accountability and procedural fairness in federal employment practices, which may resonate with other public sector employees.

Impact on Specific Stakeholders

For VA employees, the rule potentially brings both positive and negative impacts. It offers a formal avenue for appeal, providing employees a structured opportunity to contest recoupment orders. This could result in fairer outcomes for those who believe a repayment demand is unwarranted.

On the downside, employees might face hurdles due to the complex language and procedures, which might require legal assistance to navigate effectively. Moreover, the potential overreliance on existing staff and resources might strain both OPM and VA operations if the volume of appeals is higher than anticipated. This could lead to delays and might affect the thoroughness of appeal considerations.

Overall, while the rule aims to ensure fairness in recoupment scenarios, the outlined issues warrant careful attention and possibly further refinement to enhance the clarity, accessibility, and effectiveness of the appeal process for all involved parties. Engaging with the public through comments could prove beneficial in addressing these concerns.

The document outlines the procedures for appealing the recoupment of awards, bonuses, and relocation expenses for employees of the Department of Veterans Affairs (VA). It includes various financial references concerning costs associated with these appeals.

Financial Overview

The Office of Personnel Management (OPM) has provided a breakdown of the 2024 basic rate of pay for an executive with a certified SES performance appraisal system, set at $246,400 annually, or $118.06 per hour. Additionally, General Schedule employees working in Washington, DC, have specific pay scales:

• GS-15, step 5: $185,824 annually and $89.04 hourly
• GS-14, step 5: $157,982 annually and $75.70 hourly
• GS-13, step 5: $133,692 annually and $64.06 hourly

These pay rates indicate the wages for employees who are involved in the process of managing appeals, thus allowing for a calculation of the costs related to the administrative handling of these appeals.

Cost Calculations for Appeals

The OPM estimates that each appeal will require an average of 40 hours of work involving employees with an average hourly labor cost of $173.43 per hour. This figure accounts for wages, benefits, and overhead, assuming a total dollar value of labor equal to 200 percent of the wage rate. Consequently, OPM projects that the cost of each appeal would be approximately $6,937.20.

Connection to Identified Issues

The financial allocations related to staffing and time dedicated to handling appeals could intersect with several identified issues:

• Resource Allocation: OPM assumes existing staff and resources will manage the workload. However, there is a potential strain if appeals exceed expectations, which the financial allocation seems to inadequately cover.

• Cost Underestimation: The cost analysis might underestimate the complexities associated with each appeal, as only staffing costs are considered without accounting for unexpected legal or administrative challenges that could escalate expenses.

Broader Context

The document also touches on larger financial implications related to regulatory impacts. It states that a regulatory impact analysis is required for rules with effects of $200 million or more in any one year, though this particular set of procedures doesn't reach that threshold. Additionally, the Unfunded Mandates Reform Act mentions that spending thresholds are set at approximately $183 million annually for State, local, or Tribal governments.

Implications for Financial Transparency

While the document details personnel costs associated with managing appeals, it lacks explicit information on how the VA might financially prepare for or accommodate these new processes. It raises potential gaps in preparing financially if more appeals arise than are anticipated, possibly leading to budgetary constraints without appropriate financial foresight.

In summary, the financial references provide a framework for understanding the expected costs of administering the appeal process but highlight potential inadequacies in financial preparation given possible complexities or higher-than-anticipated numbers of appeals.