dollars were offset at that time; indeed, to date the offset has still not begun. We see no basis for setting aside the Department's final determination, rendered years later, merely because the Department prematurely requested offset and then quickly corrected itself.
Similarly, we reject the plaintiff's reliance on the Department's purported failures to internally consider his hardship requests. Based on the record before us, the Department did in fact consider the hardship request, first on August 1989, and again later when it adhered to the first decision in June 1994. Def.'s Mot., Exs. 10, 17. Moreover, the absence of a third internal consideration prior to forwarding the case for an oral hearing was the result of a miscommunication; the Department believed that Sibley would invoke an oral hearing even if he won internally. Id., Ex. 21. We cannot characterize the agency's actions as arbitrary and capricious.
Finally, we reject the plaintiff's arguments that the ALJ acted arbitrarily and capriciously by denying a one-month continuance of the oral hearing and by denying a face-to-face hearing. The ALJ's November 16 letter notified Sibley that the hearing would take place on December 7; the ALJ later reset the date to December 12, almost four weeks after the original notice. By late 1994, Sibley had already proffered numerous submissions during the six-year history of the Department's collection efforts. In light of these facts, and given the time the ALJ provided to Sibley to submit even more materials, the denial of the continuance was not arbitrary and capricious. Nor was the denial of a face-to-face hearing; the applicable regulations provide for telephonic testimony if the employee is located outside the Washington, D.C. area, or simply at the discretion of the hearing official. 34 C.F.R. § 31.8(d)(3)(i), (iii). In the instant case, the ALJ gave Sibley the opportunity to explain why a face-to-face hearing was required, but Sibley failed to provide any reasons at all. Accordingly, we hold that the ALJ's procedural decisions were not arbitrary and capricious.
C. Statute of Limitations
Sibley next asserts that the Department's attempt to collect his debt by offset is barred by the statute of limitations. We observe first that, even according to Sibley's position that a ten-year limitations period applies to initiation of offset proceedings, and thus the period expired May 15, 1992, Compl. P 35, the Department timely sent Sibley its first notice of offset in July 1988.
More importantly, however, Congress repealed all limitations periods previously applicable to a "suit . . ., offset, garnishment, or other action initiated or taken" by the Department for repayment of federally insured student loans. Higher Education Technical Amendments (HETA) of 1991, Pub. L. 102-26, § 3(a), 105 Stat. 123, 124 (codified at 20 U.S.C. § 1091a(2)(D)). And the repeal applies retroactively to all such loans. HETA, § 3(b), (c), 105 Stat. 123, 125; United States v. Glockson, 998 F.2d 896, 897 (11th Cir. 1993); see also United States v. Phillips, 20 F.3d 1005, 1007 (9th Cir. 1994) (per curiam) (collecting cases). Although Sibley complains that the repeal violates due process, Compl. P 36, retroactive repeal of a limitations period applicable to monetary debts does not violate due process. United States v. Hodges, 999 F.2d 341, 342 (8th Cir. 1993) (citing Campbell v. Holt, 115 U.S. 620, 628-29, 29 L. Ed. 483, 6 S. Ct. 209 (1885)). Statutes of limitations are legislatively created defenses, not constitutionally protected "property," and thus are subject to legislative amendments, including retroactive repeals. See id. at 628.
D. Equal Protection of the Law
Read liberally, the plaintiff also complains that the statutory provision permitting the Department to collect the debt of federal employees via an offset, 5 U.S.C. § 5514, violates his right to equal protection of the law, presumably under the equal protection component of the Fifth Amendment applied to the federal government. Wayte v. United States, 470 U.S. 598, 610 n.9, 84 L. Ed. 2d 547, 105 S. Ct. 1524 (1985) (citing Bolling v. Sharpe, 347 U.S. 497, 499, 98 L. Ed. 884, 74 S. Ct. 693 (1954)). A classification based on federal employee-status bears none of the hallmarks of classifications subject to heightened review, see City of Cleburne v. Cleburne Living Center, 473 U.S. 432, 440-41, 87 L. Ed. 2d 313, 105 S. Ct. 3249 (1985), and thus we review § 5514 for rationality only. Nordlinger v. Hahn, 505 U.S. 1, 10, 120 L. Ed. 2d 1, 112 S. Ct. 2326 (1992) (explaining that where heightened review is inapplicable, Equal Protection Clause requires only that the classification rationally further legitimate government interest). We conclude that the collection of funds owed to the federal government is a legitimate purpose, and that salary offsets--a remedy particularly available when deducting from the federal government's own paychecks--constitute a rational manner to effectuate the government purpose.
Finally, Sibley argues that laches prevents the Department from attempting to collect repayment. This equitable defense is not necessarily applicable to the federal government, Martin v. Consultants & Admins., Inc., 966 F.2d 1078, 1090 (7th Cir. 1992) (citing United States v. Summerlin, 310 U.S. 414, 416, 84 L. Ed. 1283, 60 S. Ct. 1019 (1940)), but Sibley appears to also contend that, through subrogation, the Department received only the lender's and the state agency's rights to collect; presumably, Sibley argues, if laches applied against the lender and the state agency, then the doctrine would also apply against the Department. Traditional rules of subrogation, however, also do not necessarily apply against the federal government, United States v. California, 507 U.S. 746, 113 S. Ct. 1784, 1790-91, 123 L. Ed. 2d 528 (1993); even if subrogation applies here, we reject Sibley's reliance on laches for two reasons.
First, Sibley has yet to raise this defense in the administrative proceedings, and thus we deem the argument waived in this suit. See Freeman United Coal Mining Co. v. Office of Workers' Compensation Programs, Benefits Review Board, 957 F.2d 302, 303 (7th Cir. 1992) (citing Arch Mineral Corp. v. Director, 798 F.2d 215, 220 (7th Cir. 1986)). Second, were we to consider the merits of the laches defense, we would decline to impose the equitable doctrine here. Courts are wary of permitting the defense where the action was brought within an express statute of limitations period, and additionally, the facts here present neither an unreasonable delay by the Department nor harm or prejudice to Sibley caused by the passage of time. Consultants & Admins., Inc., 966 F.2d at 1091. Accordingly, we hold that laches did not bar the Department's proceedings.
For the reasons set forth above, we conclude that there exists no basis to set aside the agency's decision.
Therefore, we enter summary judgment for the defendant. It is so ordered.
MARVIN E. ASPEN
United States District Judge