So far during the current fiscal year, the federal government has mailed more than 26,000 letters over the signature of Kathleen A. Haggerty. The recipients were seldom pleased to hear from her.

Her title is director of debt collection management for the Justice Department. Basically, Haggerty, 48, is the government's chief hunter of deadbeats.

When someone becomes seriously delinquent in repaying a nontax government obligation--for example, a student loan--and attempts to collect by the lending government agency and private debt collection specialists have failed, the case frequently is turned over to Haggerty and her staff.

The next step is the letter from Haggerty threatening a lawsuit.

"We're the collector of last resort for the federal government," she said.

It is a booming business. According to the Office of Management and Budget, at the end of fiscal 1997 the federal government was owed more than $1 trillion in nontax payments, including $51.9 billion that was considered delinquent. More than half the delinquencies involved loans and other credit extensions from five agencies--Housing and Urban Development, the Small Business Administration, the Veterans Administration and the departments of Education and Agriculture.

In each of the last two fiscal years, largely because of a crackdown by the Education Department on delinquent student loans, the number of cases referred to Haggerty's unit has swelled to more than 30,000, compared with about 12,000 in fiscal 1994. Last year, the total in bad debts handed over to the Justice Department was $905 million.

Haggerty supervises a central staff of 25. Much of the litigation is handled by U.S. attorney's offices around the country, although in 12 of the busiest judicial districts, including Washington, the department also uses private contract lawyers who get to keep a percentage of whatever they collect, generally in the range of 28 percent to 30 percent.

A native of Springfield, Mass., Haggerty has headed the debt collection management unit for five years. She began her Justice Department career as an assistant U.S. attorney in Brooklyn, where for a time she was in charge of the office's financial litigation section.

"It helps to have been there," Haggerty said of that early experience. "It helps to know what it's like to be in a U.S. attorney's office and go into court to collect debts."

She later served as an assistant director of the financial litigation staff in the Executive Office for U.S. Attorneys, where she developed and implemented debt collection policies and procedures for U.S. attorneys' offices.

Haggerty has heard her share of excuses.

"We don't often see the same explanation twice on why they don't owe the debt," she said. "We see people who don't believe you have to repay the federal government. We see people who can't pay, and people who can pay but don't care. A lot of professional people think there is a statute of limitations" on unpaid government loans.

"There isn't," Haggerty said.

But not everyone offers an excuse. "Some people are relieved when we try to collect," she said. "They've been worrying and worrying."

One of the most effective collection methods that the government now employs does not require anyone to go into court. Called the Treasury Offset Program, this approach matches individuals who are due a tax refund with those who are delinquent in repaying loans from other government agencies. "You may not get a refund," Haggerty said. "Instead, you may get a letter from the Treasury saying, 'We gave your refund to the Department of Education.' "

The nature of debts owed to the government changes with the times. Today, Haggerty's office handles fewer delinquent VA loans than in the past, in part because there are fewer veterans. Despite pockets of economic hardship in the Farm Belt, there also are fewer delinquent farm and rural housing loans than in the past.

The farm loans tended to be the largest referred to the Justice Department for legal action. As a result, while Haggerty's office is pursuing more individual debtors than ever, the amount of money it is after is less than it was earlier in the 1990s.

But whatever the source or amount, it is still owed to the government. "I think it's an important job," Haggerty said. "The taxpayers do not deserve to have Congress subsidize people who can pay their debts."


Kathleen A. Haggerty

Title: Director of debt collection management, Justice Department.

Age: 48.

Education: Bachelor's degree, Emmanuel College; law degree, Suffolk College.

Family: Divorced.

Previous job: Assistant director, financial litigation staff, Executive Office for U.S. Attorneys.

Hobbies: Reading (especially murder mysteries), crossword puzzles.