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Comptroller's Offset System

Bureau of Local Roads and Streets, IDOT


Over the past few years there have been several local agencies that have had their motor fuel tax allotment checks reduced, from the allotment amount, by action and operation of State law. This procedure is commonly referred to as the Comptroller's Offset System. It is authorized by the Illinois Revised Statutes, Chapter 15, Paragraph 210.05. That paragraph paraphrased, states that if any person or agency owes the State money and the State has been unable to collect this debt, the State department, agency, or commission to whom the debt is owed, may notify the Comptroller's Office and any check being issued by the State to that person or agency may be reduced or taken in its entirety until the debt owed the State is satisfied. Simply stated, if you do not pay your debt to the State, the State can take it from any amount due you.

We want to assure you that it is not quite as simple as it may sound. There are procedures that the department, agency or commission to whom the debt is owed must follow to accomplish this action. These procedures provide that all claims submitted for offset by any arm of the State must be preceded by meaningful notice and opportunity to be heard to the person or agency owing the debt. This must include, at a minimum, a clear and detailed notice to the person or agency whose State warrant might be intercepted, specifying the nature and amount of the claim and possible defenses to the offset, such as discharge in bankruptcy, mistaken identity, prior payment of the debt, inaccuracy in the amount of the claim or other relevant defenses. In addition, where requested, the State agency must allow the person or agency subject to offset to present relevant documentary evidence and examine the materials upon which the State agency relied in determining the claim. Upon completion of this review, the State agency must render a written decision. This agency's decision must be reviewable, e.g., in the Circuit Court or the Court of Claims.

All of the above must be completed prior to the offset claim being filed with the Comptroller. Rules of the Comptroller require agencies submitting claims for the offset to provide:
1. A description of the type of notification given to the person or agency against whom the claim exists and the type of opportunity to be heard afforded such person.
2. A statement as to the outcome of any hearings or other proceedings held to establish the debt or a statement that no hearing was requested.
3. The date of the final determination of the debt.

As you can see from the above rules, any person or agency indebted to the State has to be given ample opportunity to be heard. Furthermore, there is no choice by the Comptroller's Office as to which checks going to the person or agency are to be offset. It offsets whatever check or checks that come up in the Comptroller's Office for payment. Therefore, it could be your motor fuel tax check, sales tax refund, income tax refund, or any other check from the State to which the person or agency is entitled.

If it happens to be your motor fuel tax check and it is not an eligible motor fuel tax expenditure, we will expect the agency to reimburse the motor fuel tax fund in the proper amount from their general fund. While we hope it will not be necessary, our annual audit will review your actions, and if necessary, the proper citation will be issued.

Credits to: Melvin W. Smith, Local Program Development Engineer.

May 1988 / Illinois Municipal Review / Page 13

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