The local department shall collect payment for a claim against a household as described in this regulation. Lump Sum. The household may pay the claim in a lump sum that is a full or a partial payment of the claim made in: Program benefits; Cash; or A combination of both. Installments. The household may choose monthly installments of a negotiated amount. When a household is currently participating, the negotiated monthly amount for repayment may not be less than the amount specified in §D of this regulation. Reduction in Allotment. Unless a payment schedule has been negotiated, the local department shall reduce the household's allotment to recover any amount of a claim not repaid through a lump sum as follows: For an AE or IHE, an allotment reduction of the greater of $10 or 10 percent of the household's monthly allotment; or For IPV, an allotment reduction of the greater of $20 or 20 percent of the household's monthly allotment. Determining Delinquency. A claim is considered delinquent if: The claim has not been paid by the due date and a satisfactory payment arrangement has not been made; or A payment agreement has been established and a scheduled payment has not been made by the due date. A claim is not considered delinquent if: Another claim for the same household is currently being paid through an installment agreement or allotment reduction; The local department cannot determine delinquency status because collection is coordinated through the courts; or The claim is awaiting fair hearing decision. Treasury Offset Program. The local department or the Department of Budget and Management, Central Collection Unit, shall submit claims that are delinquent for 180 days or more and legally enforceable for collection from federal payments which include, but are not limited to: Income tax refunds; Federal salaries; or Retirement benefits. Local Department Action on Claims. The local department shall: Send a demand letter for repayment as described in Regulation .54K of this chapter; and Reduce the allotment as described in §D of this regulation for a household that is participating in the Program. If a household responds to the demand letter, but fails to comply with its repayment agreement according to §C of this regulation, the local department shall: Send a notice that no payment or a lesser payment was received and that: The household has a right to discuss renegotiation, and Unless the household makes the overdue payments or contacts the local department, the allotment of a currently participating household against which a claim has been established may be reduced without an adverse action notice; Initiate allotment reduction for currently participating households if there is no response to the notice; and Take no further action if the household responds to the notice and makes a payment and states that it will continue to do so based on the existing agreement. The local department shall repay to the household any overpaid claims by whatever method the local department considers appropriate, according to the household's circumstances. The local department may choose other appropriate collection action, including referral to the Department of Budget and Management, Central Collection Unit when efforts by the local department have failed. The local department may not require the household to liquidate its resources to make the repayment. Terminating and Writing Off Claims. Definitions. In this section, the following terms have the meanings indicated: “Terminated claim” means a claim in which all collection action has ceased. “Written off claim” means the claim is no longer subject to continued federal or State collection and reporting requirements. The local department shall terminate and write off a claim when: The claim is invalid; All adult household members die; It is not cost effective to pursue the claim because: The claim balance is $25 or less; The claim has been delinquent for 90 days or more; and There are no other claims against the household resulting in a total of greater than $25; or The claim is delinquent for 3 years or more and the local department or the Department of Budget and Management, Central Collection Unit, does not plan to pursue the claim through the Treasury Offset Program as described in §F of this regulation. The local department may terminate and write off a claim if the household cannot be located. Changes in Household Composition. The local department shall initiate collection action against any adult members of a household at the time an overissuance occurred. In pursuing a claim, a local department may: Pursue collection action against any household that has an adult member that received the overissuance; Offset an amount of the claim against restored benefits owed to any household which contains an adult member of the original household at the time the overissuance occurred; Use any of the appropriate methods of collecting payments listed in §§B—F of this regulation; and Not collect more than the amount of the claim.