(1) A claimant agency may submit debts in excess of Twenty-five Dollars ($25.00) owed to it to the commission for collection through setoff, under the procedure established by this article, except in cases where the validity of the debt is legitimately in dispute, an alternate means of collection is pending and believed to be adequate, or such collection would result in a loss of federal funds or federal assistance.
(2) Upon the request of a claimant agency, the commission shall setoff any refund, as defined herein, against the sum certified by the claimant agency as provided in this article.