Business, Management, and Financial

Federal Payment

Colby Community College (the College) works to minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the College whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means.

1. Colby Community College must be paid in advance, provided it maintains or demonstrates the willingness to maintain both written procedures that minimize the time elapsing between the transfer of funds and disbursement by the College, and financial management systems that meet the standards for fund control and accountability as established in this part. Advance payments to the College must be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the College in carrying out the purpose of the approved program or project. The timing and amount of advance payments must be as close as is administratively feasible to the actual disbursements by the College for direct program or project costs and the proportionate share of any allowable indirect costs. The College must make timely payment to contractors in accordance with the contract provision. 
   
   
2. Whenever possible, advance payments must be consolidated to cover anticipated cash needs for all Federal awards made by the Federal awarding agency to the recipient. 
   
   
   • Advance payment mechanisms include, but are not limited to, Treasury check and electronic funds transfer and must comply with applicable guidance in 31 CFR part 208.
   • The College must be authorized to submit requests for advance payments and reimbursements at least monthly when electronic fund transfers are not used, and as often as they like when electronic transfers are used, in accordance with the provisions of the Electronic Fund Transfer Act.
     
     
3. Reimbursement is the preferred method when the requirements cannot be met, when the Federal awarding agency sets a specific condition per § 200.208, or when the non- Federal entity requests payment by reimbursement. This method may be used on any Federal award for construction, or if the major portion of the construction project is accomplished through private market financing or Federal loans, and the Federal award constitutes a minor portion of the project. When the reimbursement method is used, the Federal awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the Federal awarding agency or pass-through entity reasonably believes the request to be improper. 
   
   
4. If the College cannot meet the criteria for advance payments and the Federal awarding agency or pass-through entity has determined that reimbursement is not feasible because the College lacks sufficient working capital, the Federal awarding agency or pass- through entity may provide cash on a working capital advance basis. Under this procedure, the Federal awarding agency or pass-through entity must advance cash payments to the College to cover its estimated disbursement needs for an initial period generally geared to the College’s disbursing cycle. Thereafter, the Federal awarding agency or pass-through entity must reimburse the non-Federal entity for its actual cash disbursements. Use of the working capital advance method of payment requires that the pass-through entity provide timely advance payments to any subrecipients in order to meet the subrecipient's actual cash disbursements. The working capital advance method of payment must not be used by the pass-through entity if the reason for using this method is the unwillingness or inability of the pass-through entity to provide timely advance payments to the subrecipient to meet the subrecipient's actual cash disbursements.
   
   
5. To the extent available, the College must disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.
   
   
6. Unless otherwise required by Federal statutes, payments for allowable costs by the College must not be withheld at any time during the period of performance unless the conditions of § 208, including § 200.339, or one or more of the following applies:
   
   
   • The College has failed to comply with the project objectives, Federal statutes, regulations, or the terms and conditions of the Federal award.
   • The College is delinquent in a debt to the United States as defined in OMB Circular A–129, “Policies for Federal Credit Programs and Non-Tax Receivables.” Under such conditions, the Federal awarding agency or pass-through entity may, upon reasonable notice, inform the College that payments must not be made for financial obligations incurred after a specified date until the conditions are corrected or the indebtedness to the Federal Government is liquidated.
   • A payment withheld for failure to comply with Federal award conditions, but without suspension of the Federal award, must be released to the College upon subsequent compliance. When a Federal award is suspended, payment adjustments will be made in accordance with § 200.343.
   • A payment must not be made to Colby Community College for amounts that are withheld by the College from payment to contractors to assure satisfactory completion of work. A payment must be made when the College actually disburses the withheld funds to the contractors or to escrow accounts established to assure satisfactory completion of work.
     
     
7. Standards governing the use of banks and other institutions as depositories of advance payments under Federal awards are as follows:
   
   
   • The Federal awarding agency and pass-through entity must not require separate depository accounts for funds provided to the College or establish any eligibility requirements for depositories for funds provided to the College. However, the non- Federal entity must be able to account for funds received, obligated, and expended.
   • Advance payments of Federal funds must be deposited and maintained in insured accounts whenever possible.
     
     
8. The College must maintain advance payments of Federal awards in interest-bearing accounts, unless the following apply:
   
   
   1. The College receives less than $250,000 in Federal awards per year.
   2. The best reasonably available interest-bearing account would not be expected to earn interest in excess of $500 per year on Federal cash balances.
   3. The depository would require an average or minimum balance so high that it would not be feasible within the expected Federal and non-Federal cash resources.
   4. A foreign government or banking system prohibits or precludes interest-bearing accounts.
      
      
9. Interest earned amounts up to $500 per year may be retained by the College for administrative expense. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Payment Management System (PMS) through an electronic medium using either Automated Clearing House (ACH) network or a Fedwire Funds Service payment.

For returning interest on Federal awards paid through PMS, the refund should:

1. 1. 1. 1. Provide an explanation stating that the refund is for interest;
         2. List the PMS Payee Account Number(s) (PANs);
         3. List the Federal award number(s) for which the interest was earned; and
         4. Make returns payable to: Department of Health and Human Services.

For returning interest on Federal awards not paid through PMS, the refund should:

1. 1. 1. 1. Provide an explanation stating that the refund is for interest;
         2. Include the name of the awarding agency;
         3. List the Federal award number(s) for which the interest was earned; and
         4. Make returns payable to: Department of Health and Human Services.

10.  Funds, principal, and excess cash returns must be directed to the original Federal agency payment system. The College should review instructions from the original Federal agency payment system. Returns should include the following information:

1. 1. 1. 1. Payee Account Number (PAN), if the payment originated from PMS, or Agency information to indicate whom to credit the funding if the payment originated from ASAP, NSF, or another Federal agency payment system.
         2. PMS document number and subaccount(s), if the payment originated from PMS, or relevant account numbers if the payment originated from another Federal agency payment system.
         3. The reason for the return (e.g., excess cash, funds not spent, interest, part interest part other, etc.)

11. When returning funds or interest to PMS you must include the following as applicable:

1. 1. 1. For ACH Returns:

Routing Number: 051036706
Account number: 303000
Bank Name and Location: Credit Gateway—ACH Receiver St. Paul, MN

1. 1. 2. For Fedwire Returns:

Routing Number: 021030004
Account number: 75010501
Bank Name and Location: Federal Reserve Bank Treas NYC/Funds Transfer Division New York, NY

* Please note that the organization initiating payment is likely to incur a charge from their Financial Institution for this type of payment.

1. 1. 3. For International ACH Returns
         Beneficiary Account: Federal Reserve Bank of New York/ITS (FRBNY/ITS) Bank:
                  Citibank N.A. (New York)
                  Swift Code: CITIUS33 Account Number: 36838868
                  Bank Address: 388 Greenwich Street, New York, NY 10013 USA Payment Details (Line 
                  70): Agency Locator Code (ALC): 75010501 Name (abbreviated when possible) and
                  ALC Agency POC
      4. For recipients that do not have electronic remittance capability, please make check payable to:

“The Department of Health and Human Services.”
Mail Check to Treasury approved lockbox:
HHS Program Support Center, P.O. Box 530231, Atlanta, GA 30353–023

 

[Added September 2023]