No. OFM 99-01
Date: January 22, 1999
Subject: Payment Requirements for Electronic Funds Transfer and Taxpayer Identification Numbers
The Debt Collection Improvement Act (DCIA) requires that all Federal payments be made electronically, unless specifically waived. The DCIA also requires that we provide the Department of Treasury (Treasury) with taxpayer identification numbers (TIN) on all payment vouchers. This includes salary payments, travel payments, and payments to vendors. Electronic payments means the payment is made directly through the banking system to the recipient's bank account. This instructional memorandum contains the policies and procedures for implementing these changes in the U.S. Geological Survey (USGS).
The Office of Management and Budget has not yet issued its revised circular as it affects implementation of the DCIA. Treasury has issued interim regulations on the TIN portion of the DCIA, and is still developing implementing regulations on some parts of the electronic funds transfer (EFT) portion of the DCIA. Also, the Department of the Interior (DOI) has not issued all of its final instructions on the DCIA. Therefore, this instructional memorandum is based on the best guidance currently available. We expect more instructions and information in the future, and as that is received, we will update this policy.
1. Employee Salary Payments
2. Other Employee Payments
All non-salary payments to employees (e.g., travel reimbursements) must be made electronically. Exceptions to this policy may be made by following the procedures in section 5 of this memorandum.
In the near future, the Office of Financial Management (OFM) will automatically change employees' bank information in the Federal Financial System (FFS) to their payroll bank account. All future travel and other USGS payments to employees will be issued via EFT to this account. This will eliminate the need to establish/change EFT bank account information in both FFS and the payroll system. Employees who desire separate bank accounts for payroll and travel or other payments will still have this option. A separate all employee notice was issued on January 14, 1999, explaining this process.
In the interim, employees are urged to sign up to have their travel reimbursements and other non-salary payments made electronically. The Office of Program Support (OPS) web site http://internal.usgs.gov/ops/finance/eft-sign.html contains guidance on the three different sign up methods. Electronic sign up (the first method described at this web site) is the recommended method since it is the quickest and provides automated feedback to the employee that the sign up was successfully accepted. Sign up for these reimbursements is currently separate from the sign up for salary payments.
3. Vendor Payments
All payments to USGS vendors must also be made electronically. Vendors who are individuals may have this requirement waived by following the procedures in section 5 of this memorandum. All payments must also include the TIN.
Activities have been undertaken to urge vendors to sign up for EFT and provide their TIN. All new procurements require the vendor to submit EFT and TIN information to OFM prior to payment. OFM did a mass mailing to all vendors paid by paper check in the past year to urge them to sign up for EFT and provide their TIN. Treasury has also been performing outreach activities to the business community to explain the requirements and urge EFT sign up.
OFM will change all vendors in FFS without EFT or TIN information to an inactive status on February 1, 1999, meaning that payments cannot be made to that vendor. Once EFT and TIN information is received the vendor will be reactivated. Procedures to be followed by remote data entry sites are at Attachment 1. These procedures suspend the Prompt Payment Act "clock", meaning that penalties will not accrue while we are seeking EFT and/or TIN information or processing waivers.
4. Third Party Drafts and Imprest Funds
Neither third party drafts nor imprest funds are considered acceptable payment mechanisms under the DCIA since they are not EFT compliant. Accordingly, these types of payments will no longer be authorized, with certain exceptions. Alternatives must be made for payments currently made by either of these mechanisms. Procedures for closing down third party drafts and imprest funds were mailed directly to cashiers on November 12, 1998.
Requests to retain individual imprest funds on a more permanent basis should be made following the procedures described in section 5 of this memorandum.
5. EFT Waivers
Treasury regulations allow for waivers to the EFT portion of the DCIA. The waiver conditions are at Attachment 2. Waivers fall into two categories: waivers for individuals and waivers for non-individuals.
Waivers under conditions 2 through 5 (at Attachment 2) may be initiated by either USGS or the vendor. These waiver requests should be made in writing through the Division Chief to OFM. Waivers under these conditions are expected to be rare.
Waivers under conditions 6 and 7, which will be more common, will be initiated by USGS and not the vendor. Procedures for processing waivers under these conditions are included in the procedures at Attachment 1.
Waiver requests to keep an imprest fund open beyond the issuance of convenience checks should be made in writing through the Division Chief's representative to OFM. Justification should include a history of payments that can not be made using alternative payment mechanisms.
6. Inability to Obtain EFT or TIN Information
The DCIA requires all payments to be made electronically and include the TIN. However, the implementing regulations from Treasury have made it clear that payments cannot be denied or delayed indefinitely. Information we have received from DOI reiterates this stance. This guidance has been incorporated in the implementing procedures at Attachment 1.
Questions concerning this instructional memorandum may be addressed to Brenda Fulk at (703) 648-7654 or email@example.com.
/s/ John J. Blickley
John J. Blickley, Acting Chief
Office of Financial Management
NOTE: Attachments 3, 4, 5, and 6 can be downloaded to WordPerfect or Microsoft Word. After clicking the appropriate link, save the file to your hard drive or local area network. Load your application and open the file to edit it.
1. Electronic Funds Transfer Processing Procedures
2. EFT Waiver Conditions
3. Direct Deposit Sign-up Form, SF-3881 (pdf file 62.2KB)
3. Download Direct Deposit Sign-up Form, SF-3881
4. Sample Letter Requesting EFT Sign Up - Individual
4. Download Sample Letter Requesting EFT Sign Up - Individual
5. Sample Letter Requesting EFT Sign Up - Non-Individual
5. Download Sample Letter Requesting EFT Sign Up - Non-Individual
6. Sample Waiver Request Memorandum
6. Download Sample Waiver Request Memorandum