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APPLICATIONS & PROGRAMS

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Credit Reform Accounts

New Accounts: Preparing to Borrow

Establish Treasury Account Symbols - Agencies with new borrowing authority should contact their Office of Management and Budget (OMB) budget representative and the Budget Reports Division (202-874-9880) within the Department of the Treasury’s Bureau of the Fiscal Service (Fiscal Service) to establish the necessary financing and receipt Treasury Account Symbols. More information related to the establishment of accounts can be found in Section 79.4 of OMB Circular A-11 and Chapter 1500 of the Treasury Financial Manual (TFM).

Establish a New Credit Reform Borrowing Agreement - Prior to borrowing activity, agencies must contact Fiscal Service’s Federal Investments and Borrowings Branch (FIBB) at Borrowings@fiscal.treasury.gov to establish a borrowing agreement. Fiscal Service’s Office of Chief Counsel will conduct a review of the applicable legislative borrowing authority to establish that the legislation is current, whether or not the agreement is subject to the Federal Credit Reform Act of 1990, as amended (FCRA), and if any exceptions or conditions exist in the legislation that require special attention.

If it's determined that the applicable borrowing authority is subject to FCRA and there are no exceptions, a standard Credit Reform Borrowing Agreement must be established. The borrowing agency must submit a completed Required Information for Establishing Credit Reform Borrowing Agreements form via e-mail to FIBB (Borrowings@fiscal.treasury.gov). To expedite the borrowing agreement drafting process, the complete text of the applicable legislative borrowing authority should also be provided to FIBB by the borrowing agency.

Based on the information provided, Fiscal Service will draft and review the borrowing agreement. If there are any discrepancies, Fiscal Service will contact the borrowing agency and make any necessary modifications. When the agreement is finalized by Fiscal Service, it will be sent to the borrowing agency in PDF format for review and signature.

Once the necessary borrowing agency signature has been obtained, the agency should send the signed borrowing agreement back to Fiscal Service for Treasury signature. The borrowing agreement is not valid until signed and dated by a certified officer for the borrowing agency and the Assistant Commissioner of Fiscal Accounting Operations for the Bureau of the Fiscal Service. A template example of a Credit Reform Borrowing Agreement is available for reference.

If it’s determined that there are exceptions or conditions in the legislation that require special attention, it’s possible that the standard Credit Reform Borrowing Agreement may be used with modification(s). If the legislation is not subject to FCRA, a nonstandard agreement will be required for the Non-Credit Reform Account.

Obtain System Accesses - The Central Accounting Reporting System (CARS) is a web-based front-end interface to Fiscal Service’s central accounting and financial reporting system. View information about obtaining access to CARS. Agencies needing to borrow should enroll in the BPD Module of CARS. Agencies can also call the Treasury Support Center (877-440-9476) for additional assistance.

The Intragovernmental Payment and Collection (IPAC) System is a web-based Fiscal Service application that provides a standardized interagency fund transfer mechanism and facilitates the intragovernmental transfer of funds with descriptive data from one agency to another. View information about obtaining access to the IPAC System. Agencies can also call the Treasury Support Center (877-440-9476) for additional assistance.

Borrowing and Repayment Transactions

All principal borrowing and repayment transactions should be submitted by borrowing agencies through the Agency Transaction Module of CARS. Agencies borrowing for Credit Reform Accounts should borrow an estimated amount for the year at the beginning of each fiscal year, but can also borrow throughout the fiscal year if necessary. However, all FCRA borrowings, other than borrowings to pay interest, must have a CARS Effective Date of October 1st of the current fiscal year. Borrowings to pay interest must have CARS Transaction and Effective Dates of September 30th of the current fiscal year.

Repayments of principal can be transacted throughout the fiscal year and must have CARS Transaction and Effective Dates equal to or greater than the date the transaction is certified in CARS. Borrowing and repayment transactions must be submitted by 3:00 pm ET to ensure same day processing.

Interest Costs - Accruals and Payments to Treasury

For Credit Reform Accounts, interest payable to Treasury is accrued throughout the fiscal year by FIBB using the previous fiscal year’s single effective rate by default, unless an updated rate estimate is provided by the borrowing agency. Borrowing agencies are required to provide an estimated interest rate for any new borrowings that do not fall under a previously established Sub-Cohort* and/or Cohort* Year. The estimated rate is adjusted to the actual rate when it becomes available in September of each fiscal year.

All interest for Credit Reform Accounts is due by September 30th of each fiscal year and must be submitted via the IPAC System. A full year of interest will be due for outstanding principal and for principal repayments made during September. A half year of compounded interest will be due for principal repayments made outside of September. Agencies must use the most recent version of the Credit Subsidy Calculator (CSC2) to calculate interest paid to Treasury. The CSC2 is normally made available by OMB ten business days prior to each fiscal year-end on the OMB MAX website. OMB can be contacted by phone at 202-395-3945 or by e-mail at CSC2@omb.eop.gov.

Reports

Each month, FIBB posts reports containing Treasury’s Loans Receivable, Interest Receivable, and Interest Revenue balances associated with agency borrowings from Treasury for each borrowing account on the Federal Borrowings Program Reports page. A Report Instructions page is available if further assistance with reports is needed.

Guidance

* Cohort - All direct loans and loan guarantees of a program for which a subsidy appropriation is provided for a given fiscal year. For direct loans and loan guarantees for which multi-year or no-year appropriations are provided, the cohort is defined by the year of obligation.

Sub-cohort - A further breakdown of the Cohort by project, program, customer or risk category.