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Cash Management Improvement Act Agreement

between

The State of Utah

and

The Secretary of the Treasury,

United States Department of the Treasury

The Secretary of the Treasury, United States Department of the Treasury (hereafter 'Secretary'), and State of Utah (hereafter 

'State'), in order to implement Section 5 of the Cash Management Improvement Act of 1990, as amended (hereafter 'Act'), agree

as follows:

1.0 AGENTS OF THE AGREEMENT 

1.1 The Authorized Official(s) for the State of Utah shall be the Director of the Division of Finance, Department of Government 

Operations. in all matters concerning this Agreement.

1.2 The Assistant Commissioner, Revenue Collections Management, Bureau of the Fiscal Service (Fiscal Service), U.S. 

Department of the Treasury, shall act as the Secretary's representative in all matters concerning this Agreement.

1.3.0 The purpose of the Act is to encourage the development of efficient cash management systems and to ensure equity 

in the transfer of funds from Federal agencies to States and ultimately to program recipients. The computation and 

payment of interest is not the objective of the Act. The interest provisions are intended to make the terms under 

which funds are transferred more equitable and to provide an incentive for better cash management.

The purpose of this Agreement is to set forth the terms and conditions which shall govern the transfer of funds 

between agencies of the Federal Government and the State in order to comply with the purpose of the Act as stated 

above. This Agreement also outlines how the State shall track and report the flow of these Federal funds for the 

programs described herein.

2.0 AUTHORITY

2.1 The authority for this Agreement is the Cash Management Improvement Act of 1990 (Public Law 101-453), as amended by 

the Cash Management Improvement Act of 1992 (Public Law 102-589), codified at 31 U.S.C. 6501 and 31

U.S.C. 6503.

2.2 The regulations codified at 31 CFR Part 205 shall apply to all matters pertaining to this Agreement, and are incorporated 

herein by reference. In the event of any inconsistency between this Agreement and 31 CFR Part 205, the regulations shall govern.

3.0 DURATION, AMENDING, TERMINATING, AND MISCELLANEOUS PROVISIONS

3.1 This Agreement shall take effect on 07/01/2021 and shall remain in effect until 06/30/2022.

3.2 This Agreement may be amended at any time by written, mutual consent of the State and the Fiscal Service. This Agreement shall 

be amended annually to incorporate new programs that qualify as major Federal assistance programs and remove programs that no 

longer qualify as major Federal assistance programs. A State must notify the Fiscal Service in writing within 30 days of the time the 

State becomes aware of a change that involves additions or deletions of programs subject to Subpart A, changes in funding 

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techniques, and/or changes in clearance patterns. The notification must include a proposed amendment for review by the Fiscal

Service.

3.3 Notwithstanding section 3.2, in the event of Federal or State non-compliance with Subpart B of 31 CFR, Part 205, the Fiscal 

Service may amend this Agreement at any time to incorporate additional programs and the entities that administer those programs.

3.4 This Agreement may be terminated by either party with 30 days written notice. If this Agreement is terminated, the Fiscal 

Service will prescribe the funding techniques, clearance patterns, and methods for calculating interest liabilities to be used by the 

State.

4.0 PROGRAMS COVERED

4.1 The State's threshold and its major Federal assistance programs shall be determined based on the State's Single Audit 

Report for fiscal year ending 06/30/2020.

All major Federal assistance programs shall be covered by this Agreement, unless otherwise specified in section 4.4 of this 

Agreement.

4.2 The State's threshold for major Federal assistance programs is $34,048,403.

The following programs meet or exceed the threshold and are not excluded in Section 4.4:

CFDA Program Name

10.551 Supplemental Nutrition Assistance Program

10.555 National School Lunch Program

12.401 National Guard Military Operations and Maintenance (O&M) 

Projects

17.225F Unemployment Insurance -- Federal Benefit Account and 

Administrative Costs

17.225S Unemployment Insurance -- State Benefit Account

20.205 Highway Planning and Construction

84.010 Title I Grants to Local Educational Agencies

84.027 Special Education -- Grants to States

93.558 Temporary Assistance for Needy Families

93.575 Child Care and Development Block Grant

93.767 Children's Health Insurance Program

93.778 Medical Assistance Program

4.3 The following programs fall below the State's threshold but have been required to be covered by Fiscal Service in 

accordance with the non-compliance provisions of Subpart B of 31 CFR Part 205:

There are currently no programs listed for Section 4.3.

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4.4 The following programs exceed the State's threshold but have been excluded from coverage for the reason indicated:

There are currently no programs listed for Section 4.4.

5.0 ENTITIES COVERED

5.1 State agencies and instrumentalities that meet the definition of a State per 31 CFR Part 205, shall be subject to the terms of this 

Agreement. The following is a list of such entities that administer funds under the programs listed in Section

4.0 of this Agreement:

Department of Health

Department of Transportation

Department of Workforce Services

State Board of Education

Utah National Guard

5.2 Entities that meet the definition of a Fiscal Agent per 31 CFR Part 205 shall be subject to the terms of this Agreement. The 

following is a list of Fiscal Agents that administer funds under the programs listed in the Section 4.0 of this Agreement:

Fiscal Agent CFDA Program Name

6.0 FUNDING TECHNIQUES

6.1 General Terms

6.1.1 The State shall request Federal funds in accordance with the appropriate cut-off times shown in Exhibit I to ensure funds will 

be received and credited to a State account by the times specified in the funding techniques. Exhibit I is incorporated by reference 

herein.

6.1.2 The State shall schedule the receipt of Federal funds such that the funds are received and credited to a State account in 

accordance with the clearance patterns specified in Exhibit II - List of State Clearance Patterns. Exhibit II is incorporated by 

reference herein.

6.1.3 In instances where the receipt of funds is scheduled for a Saturday, the State shall request funds for deposit on Friday. In 

instances where the receipt of funds is scheduled for a Sunday, the State shall request funds for deposit on Monday. In instances 

where the receipt of Federal funds is scheduled for deposit on a day when the State is not open for business, the State shall request 

funds for deposit the day following the scheduled day; in instances where the receipt of Federal funds is scheduled for deposit on a 

day when the Federal Government is not open for business, the State shall request funds for deposit the day prior to the scheduled 

day.

6.1.4 Estimates and Reconciliation of Estimates:

Where estimated expenditures are used to determine the amount of the drawdown, the State will indicate in the terms of the State 

unique funding technique how the estimated amount is determined and when and how the State will reconcile the difference 

between the estimate and the State's actual expenditures.

6.1.5 Supplemental Funding:

Unless otherwise defined by program rules, Supplemental Funding is the award of additional funds to provide for an increase in 

costs due to unforeseen circumstances.

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The State will comply with all Federal program agency policies and procedures for requesting supplemental grant funding.

The State will comply with the following guidelines when requesting supplemental funding for the Medical Assistance Program 

and associated administrative payments (CFDA 93.778):

The State must submit a revised Medicaid Program Budget Report (CMS-37) to request supplemental funding. The CMS guidelines 

and instructions for completing the CMS-37 are provided in Section 2600F of the State Medicaid Manual (SMM). The CMS/CO must 

receive the revised Form CMS-37 through the Medicaid Budget Expenditure System/Children's Budget Expenditure System 

(MBES/CBES) no later than 10 calendar days before the end of the quarter for which the supplemental grant award is being 

requested.

Additional guidance on this policy is available from the respective CMS Regional Office, U.S. Department of Health & Human 

Services.

The State will comply with the following guidelines when requesting supplemental funding for TANF (CFDA 93.558), CCDF 

(CFDA 93.575), CSE (93.563), and the FC/AA (CFDA 93.658 and CFDA 93.659) programs administered by the

U.S. Department of Human Services, Administration for Children and Families (HHS/ACF):

a. Timing of the Request

A State should initiate its request for supplemental funding during a quarter as soon as it becomes aware of the fact that a shortfall 

does/will exist. For the TANF and CCDF grants, supplemental funding requests (estimates) may be submitted by a State, for 

consideration by ACF, up through and including the 15th day of the third month of the first, second or third quarter of any fiscal year. 

Since TANF and CCDF are block grant programs, all unawarded portions of the annual allotment will automatically be issued at the 

beginning of the fourth quarter. Therefore, supplemental funding requests will not be available during the fourth quarter for these 

programs. For the CSE and FC/AA programs, supplemental funding requests may be submitted by a state, for consideration by ACF, 

up through and including the 15th day of the third month of any quarter of a fiscal year.

b. Justification for the Request

The request for a supplemental funding for any of the above-mentioned programs should contain a justification clearly documenting 

the need for the additional funding authority during the current quarter. This documentation should be in the form of State accounting 

records or similar documents that will show the actual expenditures through the most recent month for which such data are available, 

as well as the State's most accurate projection of its anticipated expenditures during the remaining month(s) of the quarter. For either 

the TANF or the CCDF program, the State's justification should also include an explanation of the activities requiring the obligation 

and/or expenditure of amounts that exceed the normal quarterly grant award restrictions and why these activities could not have been 

delayed until the next quarter.

c. Form Submittal

Supplemental funding requests should be made by completing the appropriate ACF quarterly report of expenditures and estimates 

applicable to the particular program for which the grant award request is being made.

d. Approval Process

Upon receipt of the state's request for additional funding authority for a quarter, the ACF Regional Office will promptly review the 

supporting documentation. If the request is properly justified, so long as ACF has adequate funding availability, the State's request 

will be expedited and supplemental funding will be issued within 5 days of ACF receiving the request. The State will be notified by 

the Regional Office when the supplemental award has been transmitted to the Payment Management System (PMS) and when it 

may initiate drawdowns against the supplemental funding.

Additional guidance on this policy is provided in the U.S. Department of Health & Human Services, Administration for Children 

and Families, letter (May 19, 2004) to State Administrators from the Deputy Assistant Secretary for Administration.

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6.2 Description of Funding Techniques

6.2.1 The following are terms under which standard funding techniques shall be implemented for all transfers of funds to which the 

funding technique is applied in section 6.3.2 of this Agreement.

Funding Technique Name Description

Actual Clearance, ZBA - ACH The State shall request funds such that they are deposited by ACH in a State account 

on the settlement date of payments issued by the State. The request shall be made in 

accordance with the appropriate Federal agency cut-off time specified in Exhibit I. 

The amount of the request shall be for the amount of funds that clear the State's 

account on the settlement date. This funding technique is interest neutral.

Actual Clearance, ZBA - Same Day Payment The State shall request funds the same day it pays out funds, in accordance with the 

appropriate Federal agency cut-off time specified in Exhibit I. A Federal agency will 

deposit funds in a State account the same day as requested. The amount of the request 

shall be for the amount of funds that clear the State's account that day. This funding 

technique is interest neutral.

Average Clearance The State shall request funds such that they are deposited by ACH on the dollarweighted average day of clearance for the disbursement, in accordance with the 

clearance pattern specified in Exhibit II. The request shall be made in accordance with 

the appropriate Federal agency cut-off time specified in Exhibit I. The amount of the 

request shall be for the exact amount of that disbursement. This funding technique is

interest neutral.

6.2.2 The following are terms under which funding techniques for administrative costs shall be implemented for all transfers 

of funds to which the funding technique is applied in section 6.3.2 of this Agreement.

There are currently no funding techniques listed in Section 6.2.2.

6.2.3 The following are terms under which miscellaneous funding techniques shall be implemented for all transfers of funds to 

which the funding technique is applied in section 6.3.2 of this Agreement.

There are currently no funding techniques listed in Section 6.2.3.

6.2.4 The following are terms under which State unique funding techniques shall be implemented for all transfers of funds to which 

the funding technique is applied in section 6.3.2 of this Agreement.

Funding Technique Name Description

Administration Costs (1) Estimates. This applies to the following programs: CFDA # 17.225 

Unemployment Insurance, CFDA # 93.558 Temporary Assistance for Needy Families, 

CFDA # 93.575 Discretionary Fund of the Child Care Development Fund, and CFDA 

# 93.596 Mandatory & Matching Funds of the Child Care Development Fund. The 

Department of Workforce Services (DWS) uses a fully cost allocated accounting 

system with a combination of both Random Moment Time Sampling (RMTS) and 

Direct Labor time charging. The most reasonable method to derive a projected 

weekly cost is a forecast-based estimate. The weekly estimates are then reviewed to 

verify that based on existing facts they are reasonable and adequate. To the fullest 

extent possible, the estimates are left unchanged during the quarter. Should a 

significant change in facts occur, the estimate is revised to assure that excessive, 

unsupportable draws are not made from any CMIA grant. (2) Payroll. Employee 

salary and benefits make up the largest portion of all administrative costs, comprising 

approximately 70-85% of the total. Payday is every other Friday. More than 99% of 

the payroll is paid out by direct deposit and is posted to each individual employee's 

bank account early Friday morning. The remainder of payroll is by warrant and is 

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either hand delivered Friday morning or mailed to that it will be received on Friday. 

Payroll warrants are outstanding 5.77 dollar-weighted business days. Thus combining 

the direct deposit amounts with the warrant amounts, overall payroll costs clear the 

bank in approximately 0.02 business days. Consequently, the Federal government is 

not out of pocket as long as Federal funds are not received before Saturday. Agencies 

may request Federal funds on Friday to be received the net business day, usually 

Monday. Payroll costs may also be requested together with other administrative costs 

as described next. (3) Administrative Costs other than Payroll. Most State agencies 

run weekly reports of all expenditures for the previous week. These reports include 

amounts paid out by warrants and allocated costs. These reports are usually run on 

Monday or Tuesday, then checked and verified the following day. Based on a large 

sample (more than 75,000 checks), these expenditures are outstanding six dollarweighted business days. Warrants are issued daily. By assigning Wednesday as the 

middle of the week and assuming an equivalent amount of administration expenditures 

are paid prior to, and after Wednesday, these expenditures should have cleared the 

bank by the following Thursday (the average day of clearance). Federal funds may be 

requested as early as the Wednesday following the previous weeks disbursements to 

be received on the next business day, usually Thursday. No Federal or State interest 

liabilities will be assessed if these procedures are followed. This funding technique is 

interest neutral.

Highway P&C Technique After accounting transactions are posted to the State's general ledger and cost 

accounting system, those transactions affecting this program are loaded into another 

computer program called the Federal Bill. In the Federal Bill, all costs are segregated 

by a project number. Within the Federal Bill, data related to each project are stored. 

When the Federal Bill is run, it accumulates all new transactions since the last time the 

Federal Bill was run. These transactions may include journal entries, adjustments, 

payroll items, electronic funds transferred, or checks issued, as well as project and 

contract amendments. If the payroll, a batch of checks, or some other item does not 

post to the general ledger accounting system properly in time to be transferred to the 

Federal Bill, then those items must wait until the next time the Federal Bill is run.

The Federal Bill is run weekly. The Federal Bill allocates the transactions to each 

project. The Federal Bill then determines the amount After the Federal Bill is checked 

for accuracy it is then submitted to the Federal Highway Administration in Salt Lake 

City. Federal funds are requested to be received within two days of submittal to 

FHWA. As long as a Federal Bill and request for reimbursement are not presented to 

the Federal Highway Administration more often than once each calendar week, and as 

long as the State receives the Federal funds within two days of submittal, neither the 

State nor the Federal Government shall incur an interest liability. If Federal funds are 

not received by the business day after they are requested, the Federal Government 

shall incur an interest liability from the business day following the date Federal funds 

were requested until the date Federal funds are received in the State's bank account. 

The request shall be made in accordance with cut-off times in Exhibit I. This funding 

technique is interest neutral.

Inter-agency transfers (IAT) In most cases in Utah, the State agency which draws down Federal funds is the major 

user or disburser of the money. In situations where funds are transferred to a second 

State agency using an IAT, the second agency is usually requesting reimbursement for 

money it has already paid out as a service provider. The second agency may have paid 

out the money in a previous month, or perhaps several months earlier. Since this is a 

small portion of their total agency funding, the transfer request is usually not done 

until after month-end accounting reports are received. This is also the reason why the 

drawdown of Federal funds for these IATs may be combined with any other 

drawdown request already being made. The first agency does not know money for the 

Federal program has been paid out by the second agency until the IAT transfer request 

is actually received. Since this represents such a small portion of total expenditures, 

the cost to track these funds in lieu of the benefits is clearly not within the spirit of 

efficient cash management practices. No Federal or State interest liabilities will be 

assessed on funds transferred between State agencies using IATs, except a Federal 

interest liability may be assessed if Federal funds are not credited to a State account 

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within the receipt window specified in Exhibit I. This funding technique is interest 

neutral.

Modified Average Clearance Warrants are issued daily. By assigning Wednesday as the middle of the week and 

assuming an equivalent amount of expenditures are paid prior to, and after 

Wednesday, the day of issuance is defined as Wednesday for all warrants issued 

during each weekly Monday through Friday period. The State shall request funds 

such that they are deposited by ACH on the dollar-weighted average day of clearance 

for the disbursement, in accordance with the clearance pattern specified in Exhibit II. 

The request shall be made in accordance with the appropriate Federal agency cut-off 

time specified in Exhibit I. This funding technique is interest neutral.

Reimbursable Funding This technique is only used for programs connected with the Army and Air National 

Guard. Disbursements for these programs are done through the use of general state 

warrants which have a clearance pattern of five business days. According to Exhibit I, 

the Army and Air National Guard needs 15 business days to respond to a request for 

funds. Consequently, the State would always be out of pocket for at least nine 

business days. In order for these programs to be accounted for in a simplified manner, 

the following procedures will be used. Funds shall only be drawn down after monthend accounting reports are received and checked, usually during the second week of 

the month following the actual expenditures. Since all warrants would have cleared 

the state's bank before a request for funds is presented to the Federal Government, the 

Federal Government shall incur an interest liability on requested funds beginning one 

business day after the request for funds is submitted until funds are deposited in a 

State account. This funding technique is not interest neutral.

USBE Composite Average Clearance Funds transferred to other State divisions, such as youth corrections, Deaf & Blind 

School, Utah State Hospital, Utah State Developmental Center, etc. are transferred 

monthly by inter-agency transfer forms as requested. Other outside service providers 

are paid by State warrant on a daily basis. These warrants are part of a composite 

check clearing pattern which encompasses most of the programs operated by the State 

Board of Education. As specified in Exhibit II, these checks clear the bank in six 

dollar-weighted business days. Internal accounting reports are run on a periodic basis 

(usually weekly) which classify all expenditures since the previous report. These 

reports include amounts paid out by warrants, as well as allocated costs from journal 

entries, and funds moved by inter-agency transfers. A midpoint date for expenditures 

in the current report is determined by dividing in half the time period covered by the 

report. If the time period covers an even number of days, the day following the time 

period midpoint will be the midpoint date. Assuming an equivalent amount of 

expenditures are paid prior to, and after the midpoint date, Federal funds to cover 

these expenditures shall be requested such that they are deposited in the State's 

account on the average date of clearance of the warrants included in the report. The 

average date of clearance is the sixth business day after the midpoint date. The 

request shall be made in accordance with the appropriate Federal agency cut-off time 

specified in Exhibit I. This funding technique is interest neutral.

6.3 Application of Funding Techniques to Programs

6.3.1 The State shall apply the following funding techniques when requesting Federal funds for the component cash flows of the 

programs listed in sections 4.2 and 4.3 of this Agreement.

6.3.2 Programs

Below are programs listed in Section 4.2 and Section 4.3.

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10.551 Supplemental Nutrition Assistance Program

Recipient: Department of Workforce Services

% of Funds Agency Receives: 100

Component: Benefit--Electronic benefit transfer (EBT)

Technique: Actual Clearance, ZBA - Same Day Payment

Average Day of Clearance: 0 Days

10.555 National School Lunch Program

Recipient: State Board of Education

% of Funds Agency Receives: 95

Component: Vendor--Funds distributed by wire transfer

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

10.555 National School Lunch Program

Recipient: State Board of Education

% of Funds Agency Receives: 5

Component: Vendor--Funds distributed by means other than wire 

transfer

Technique: USBE Composite Average Clearance

Average Day of Clearance: 6 Days

12.401 National Guard Military Operations and Maintenance (O&M) 

Projects

Recipient: Utah National Guard

% of Funds Agency Receives: 100

Component: All Funds

Technique: Reimbursable Funding

Average Day of Clearance: N/A

17.225F Unemployment Insurance -- Federal Benefit Account and 

Administrative Costs

Recipient: Department of Workforce Services

% of Funds Agency Receives: 86

Component: Benefit EFT

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

17.225F Unemployment Insurance -- Federal Benefit Account and 

Administrative Costs

Recipient: Department of Workforce Services

% of Funds Agency Receives: 14

Component: ADMINISTRATION FUNDS

Technique: Administration Costs

Average Day of Clearance: 6 Days

17.225S Unemployment Insurance -- State Benefit Account

Recipient: Department of Workforce Services

% of Funds Agency Receives: 100

Component: Benefit EFT

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

20.205 Highway Planning and Construction

Recipient: Department of Transportation

% of Funds Agency Receives: 100

Component: All Funds

Technique: Highway P&C Technique

Average Day of Clearance: 6 Days

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84.010 Title I Grants to Local Educational Agencies

Recipient: State Board of Education

% of Funds Agency Receives: 91

Component: Vendor--Funds distributed by wire transfer

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

84.010 Title I Grants to Local Educational Agencies

Recipient: State Board of Education

% of Funds Agency Receives: 9

Component: Vendor & Admin.--Funds distributed by means other than 

wire transfer

Technique: USBE Composite Average Clearance

Average Day of Clearance: 6 Days

84.027 Special Education -- Grants to States

Recipient: State Board of Education

% of Funds Agency Receives: 76

Component: Vendor--Funds distributed by wire transfer

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

84.027 Special Education -- Grants to States

Recipient: State Board of Education

% of Funds Agency Receives: 24

Component: Vendor & Admin.--Funds distributed by means other than 

wire transfer

Technique: USBE Composite Average Clearance

Average Day of Clearance: 6 Days

93.558 Temporary Assistance for Needy Families

Recipient: Department of Workforce Services

% of Funds Agency Receives: 42

Component: Benefit--Funds distributed by electronic benefits transfers 

(EBT

Technique: Actual Clearance, ZBA - Same Day Payment

Average Day of Clearance: 0 Days

93.558 Temporary Assistance for Needy Families

Recipient: Department of Workforce Services

% of Funds Agency Receives: 48

Component: ADMINISTRATION FUNDS

Technique: Administration Costs

Average Day of Clearance: 6 Days

93.558 Temporary Assistance for Needy Families

Recipient: Department of Workforce Services

% of Funds Agency Receives: 10

Component: Inter-Agency Transfers

Technique: Inter-agency transfers (IAT)

Average Day of Clearance: 0 Days

93.575 Child Care and Development Block Grant

Recipient: Department of Workforce Services

% of Funds Agency Receives: 1

Component: Benefit--Funds distributed by Warrant

Technique: Average Clearance

Average Day of Clearance: 6 Days

93.575 Child Care and Development Block Grant

Recipient: Department of Workforce Services

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% of Funds Agency Receives: 72

Component: Benefit--Funds distributed by EFT

Technique: Actual Clearance, ZBA - Same Day Payment

Average Day of Clearance: 0 Days

93.575 Child Care and Development Block Grant

Recipient: Department of Workforce Services

% of Funds Agency Receives: 27

Component: ADMINISTRATION FUNDS

Technique: Administration Costs

Average Day of Clearance: 6 Days

93.767 Children's Health Insurance Program

Recipient: Department of Health

% of Funds Agency Receives: 99

Component: Benefit EFT

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

93.767 Children's Health Insurance Program

Recipient: Department of Health

% of Funds Agency Receives: 1

Component: ADMINISTRATION FUNDS

Technique: Administration Costs

Average Day of Clearance: 6 Days

93.778 Medical Assistance Program

Recipient: Department of Health

% of Funds Agency Receives: 98

Component: Benefit EFT

Technique: Actual Clearance, ZBA - ACH

Average Day of Clearance: 1 Day

93.778 Medical Assistance Program

Recipient: Department of Health

% of Funds Agency Receives: 1

Component: ADMINISTRATION FUNDS

Technique: Administration Costs

Average Day of Clearance: 6 Days

93.778 Medical Assistance Program

Recipient: Department of Health

% of Funds Agency Receives: 1

Component: Vendor--Portion distributed by MEDICAID warrant

Technique: Modified Average Clearance

Average Day of Clearance: 6 Days

6.3.3 Materiality Exemptions

Agencies exempt from coverage on the basis of materiality:

None

6.3.4 Rebates. Utah usually receives monthly rebate checks from prescription drug companies participating in CFDA 

93.778 Medical Assistance Program. Although it is not known when these checks will be received, when they are 

received, the next drawdown(s) is(are) immediately reduced by the amount of the rebate. This funding technique is 

not interest neutral.

7.0 CLEARANCE PATTERNS

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7.1 The State shall develop separate clearance patterns for each of the following:

Check clearance patterns are developed for all situations in which state warrants are issued; these include payments to: beneficiaries, 

vendors providing services, payroll, and administrative costs. The techniques listed here apply to all covered programs listed in Section 

4.2. In order to simplify the process, hold costs down, keep time required to a minimum, and use data and methods currently available 

to the State, the average clearance method and not the estimated clearance method was selected. (Limitations in the State's central 

accounting system, and other limitations in our banks' warrant processing and recording systems, also narrowed the viable choices.) 

Dollar-weighted, average day of clearance patterns were developed using a 100% sample based on data from at least three consecutive 

months for individual programs or groups of programs having similar clearance characteristics. The development of general clearance 

patterns for payroll and general state warrants is described in Section 6.2.4, Administration Costs.

7.2 The following shall develop the State's clearance patterns:

The Division of Finance, Department of Government Operations, for the State of Utah shall develop the State's clearance patterns, 

calculating them every five years.

7.3 The sources of data the State shall use when developing its clearance patterns are as follows:

The State shall use Excel spreadsheets to calculate its clearance patterns. Warrant issuance data is extracted from the State's general 

accounting system. Clearance dates are provided to the State by the State's warrant processing banks.

7.4 The State shall use the following methodology when developing its clearance patterns:

When developing each clearance pattern, the State shall track at least 99% of the funds disbursed, from issuance to clearance, for a 

period of at least three months.

7.5 The State shall identify for each check or warrant (hereafter, check) in the population: (1) the date the check was released 

for payment; (2) the date the check was debited from the State's account, and, (3) the amount of the check.

7.6 The State shall use the following method to calculate the dollar-weighted average day of clearance:

To determine the number of days each check was outstanding (clearance time), the issue date shall be subtracted from the date the 

check cleared the State's account.

To determine the percentage of the disbursement paid out each day following issuance, the amount of the checks that clear the

State's account each day shall be summed and then divided by the amount of the total disbursement.

For each day following issuance, the clearance time of the checks paid out that day shall be multiplied by the percentage of the total 

disbursement those checks represent. This product is the clearance factor.

The dollar-weighted average day of clearance for the disbursement shall be determined by summing the clearance factor of each day 

following the disbursement.

7.7 The State shall adjust each clearance pattern to reflect the dollar-weighted proportion of funds paid out by EFT/Direct payroll, 

with the following exceptions:

No exceptions.

The State shall also adjust each clearance pattern to reflect:

No adjustments.

7.8 Each of the State's clearance patterns is calculated in Business days.

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7.9 An authorized State official shall certify that each clearance pattern developed by the State accurately corresponds to the 

clearance activity of the programs to which it is applied. This certification shall be provided to the Fiscal Service prior to the 

effective date of the Agreement. The State shall recertify its clearance patterns at least every five years.

7.10 The State shall follow the procedures of 31 CFR 205 if it has actual or constructive knowledge, at any time, that a clearance

pattern does not correspond to a program's clearance activity.

8.0 INTEREST CALCULATION METHODOLOGY

8.1 General Terms

8.1.1 The State and the Secretary agree that no interest liabilities will be incurred for transfers of funds made in accordance 

with the procedures specified in section 6 of this Agreement where the following funding techniques are applied:

Actual Clearance, ZBA - ACH

Actual Clearance, ZBA - Same Day Payment

Administration Costs

Average Clearance

Highway P&C Technique

Inter-agency transfers (IAT)

Modified Average Clearance

USBE Composite Average Clearance

8.1.2 The State shall maintain information on disbursements and receipts of funds to verify the implementation of any funding 

technique and document interest liabilities.

For each disbursement, the State shall be able to identify:

(1) amount of the issuance

(2) date of issuance

(3) date Federal funds are received and credited to a State account

(4) amount of Federal funds received

(5) date funds were requested

8.2 Federal Interest Liabilities

8.2.1 A Federal interest liability shall accrue from the day the State pays out its own funds for program purposes to the day Federal 

funds are credited to a State account. With regard to funds transferred out of the Federal Highway Trust Fund, if a State does not bill 

at least weekly for current project costs, the Federal interest liability shall not accrue prior to the day the State submits a request for 

funds.

8.2.2 The State shall use the following method to calculate Federal interest liabilities:

For all transactions where the State pays out its own funds for program purposes prior to receiving Federal funds, the State shall track 

each payment from the date it is paid out of a State account to the date Federal funds are subsequently credited to a State account to 

cover that outlay. The Federal interest liability on each payment shall be based on the difference in whole days between the two events. 

With Federal-State matching programs, interest shall be calculated on the Federal percentage of the disbursement.

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8.3 The Unemployment Trust Fund

8.3.1 The State shall use the following method to calculate State interest liabilities on funds withdrawn from the several accounts 

in the Unemployment Trust Fund:

Federal Funds Interest Neutral, State Funds not:

The State shall use the following methodology to calculate State interest liabilities on funds withdrawn from the State account in the 

UTF under the Unemployment Insurance program.

Based on statements provided by its financial institution (or other appropriate sources), the State shall determine the actual interest 

earnings and the related banking costs attributable to funds withdrawn from its account in the UTF. At the end of the State's fiscal year, 

the State shall calculate the percentage of its total unemployment compensation expenditures for (1) funds withdrawn from the State 

account in the UTF, or the State %, and (2) funds withdrawn from the Federal Employees Compensation Account (FECA) and the 

Extended Unemployment Compensation Account (EUCA) and any other accounts of Federal funds in the UTF, or the Federal %.

The actual interest earnings of the benefit payment account on the whole constitute the actual interest earnings attributable to funds 

withdrawn from the State account in the UTF, since the State shall apply an appropriate interest neutral funding technique, to funds 

withdrawn from the FECA and EUCA and any other benefit accounts of Federal funds in the UTF from which the State draws.

The State shall calculate the related banking costs attributable to funds withdrawn from the State account in the UTF by multiplying the 

State % by the amount of the related banking costs of the benefit payment account as a whole. The State's liability for interest on funds 

withdrawn from its account in the UTF shall consist of the actual interest earnings of the benefit payment account on the whole less the 

related banking costs attributed to such funds.

8.4 Refund Liabilities

8.4.1 The State shall be liable for interest on refunds from the date the refund is credited to a State account until the date the refund 

is debited from the State account for program purposes. The State shall apply a $50,000 refund transaction threshold below which 

the State shall not incur or calculate interest liabilities on refunds. A transaction is defined as a single deposit.

8.4.2 For each refund, the State shall maintain information identifying:

(1) date a refund is credited to a State account

(2) date of the subsequent deposit of Federal funds against which the refund is offset

(3) amount of the refund

8.4.3 The State shall use the following methodology to calculate interest liabilities on refunds:

With programs to which applicable interest neutral funding techniques are applied, the State interest liability shall be based on the 

difference in whole days between the date the refund is deposited in a State account and the date the refund is offset against a 

subsequent deposit of Federal funds.

8.5 Exemptions

8.5.1 Where more than one State agency is a recipient of Federal funds under a program, a particular State agency's funding may be 

excluded from interest calculation procedures if the State agency receives an amount of funds less than 5

% of the State's threshold for major Federal assistance programs. Notwithstanding this potential exemption, however, in no case 

shall less than 90% of a program's total funding be subject to interest calculation procedures.

Proration of calculations: If less than total program funding is subject to interest calculation procedures, the resulting interest 

liability calculations shall be prorated to 100% of program funding.

8.6 State Interest Liabilities

8.6.1 The State shall be liable for interest on Federal funds from the date Federal funds are credited to a State account until the 

date those funds are paid out for program purposes.

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8.6.2 The State shall use the following method to calculate State interest liabilities on Federal funds:

8.6.2.1 Measuring Time Funds Are Held

To determine the total time Federal funds are held, the State shall measure the time between the date Federal funds are received and 

credited to a State's account and the date those funds are debited from the State's account.

8.6.2.2 Source of Data

Clearance Patterns:

The time period from issuance of funds to the date funds are debited from the State's account shall be determined by the 

appropriate clearance pattern specified in Exhibit II.

8.6.2.3 Standards Applied

The average daily cash balance of Federal Funds in the program's account reflects the actual activity of each draw from the date of 

deposit to the date of issuance or clearance, whichever is pertinent.

8.6.2.4 Calculation Procedure

I = ADB x R, where

I = State's total interest liability

ADB = Average Daily Balance of cash in a program's account, measured from deposit to clearance

R = Annualized rate equal to the average equivalent yields of 13-week Treasury bills auctioned during a State's fiscal year

9.0 REVERSE FLOW PROGRAMS

The State is not required to cover any reverse flow programs under the terms of this Agreement because the State does not 

participate in the program.

10.0 INTEREST CALCULATION COSTS

10.1 As set forth in 31 CFR 205.27, interest calculation costs are defined as those costs necessary for the actual calculation of 

interest, including the cost of developing and maintaining clearance patterns in support of the interest calculations. Interest 

calculation costs do not include expenses for normal disbursing services, such as processing of checks or maintaining records for 

accounting and reconciliation of cash balances, or expenses for upgrading or modernizing accounting systems. Interest 

calculation costs in excess of $50,000 in any year are not eligible for reimbursement, unless the State provides justification with 

the annual report.

10.2 The State expects to incur the following types of interest calculation costs:

Costs incurred in compiling and analyzing data related to interest calculation and in preparing the State's Annual Report to Fiscal 

Service are considered Interest Calculation Costs.

10.3 The State shall submit all claims for reimbursement of interest calculation costs with its Annual Report in accordance with 31 

CFR 205.

11.0 NON-COMPLIANCE

11.1 The provisions of 31 CFR Part 205.29 and 31 CFR Part 205.30 shall apply in cases of non-compliance with the terms of 

this Agreement.

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12.0 AUTHORIZED SIGNATURES

Janica Gines, CPA

Director, Division of Finance, Department of Government Operations, State of Utah

Signature: Date Signed:

Date Submitted 6/30/2021

Sandra R. Paylor

Acting Assistant Commissioner

Revenue Collections Management

Bureau of the Fiscal Service

U.S. Department of the Treasury

Signature: Date Signed:

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6/30/2021

7/11/2021
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Exhibit I - Funds Request and Receipt Times Schedule

State of Utah

Federal Agency Payment Type Request Cut-Off Time Receipt Window

Agriculture-FNS ACH 11:59 PM 1 day

Agriculture-FNS Fedwire 5:45 PM 0 day

Agriculture-FS ACH 3:00 PM 1 day

Air National Guard ACH 12:00 PM 15 days

Army National Guard ACH 12:00 PM 15 days

Commerce-NOAA ACH 2:00 PM 1 day

Dept of Homeland Security (FEMA) Fedwire 2:00 PM 2 days

Dept of Homeland Security (ODP) ACH 2:00 PM 2 days

Dept of Homeland Security (ODP) Fedwire 2:00 PM 2 days

EPA ACH 2:00 PM 2 days

EPA Fedwire 2:00 PM 0 day

Education ACH 3:00 PM 1 day

Education Fedwire 2:00 PM 0 day

Energy ACH 4:00 PM 1 day

Energy Fedwire 3:00 PM 0 day

HHS ACH 5:00 PM 1 day

HHS Fedwire 3:00 PM 0 day

HUD ACH 5:30 PM 2 days

HUD Fedwire 3:00 PM 0 day

Interior-FWS ACH 11:59 PM 1 day

Interior-FWS Fedwire 5:45 PM 0 day

Interior-OSM ACH 3:00 PM 1 day

Interior-OSM Fedwire 1:00 PM 0 day

Justice ACH 11:00 PM 6 days

Justice Fedwire 2:00 PM 2 days

Labor-Non-UTF ACH 3:00 PM 1 day

Labor-UTF ACH 3:00 PM 1 day

Labor-UTF Fedwire 3:00 PM 0 day

National Science Foundation (NSF) ACH 8:00 PM 1 day

National Science Foundation (NSF) Fedwire 5:45 PM 0 day

Social Security Administration ACH 11:59 PM 1 day

Social Security Administration Fedwire 5:45 PM 0 day

Transportation (FAA) ACH 2:00 PM 1 day

Transportation (FHWA) ACH 12:00 PM 3 days

Transportation (FHWA) Fedwire 12:00 PM 0 day

Transportation (FTA) ACH 2:00 PM 1 day

Veterans Administration ACH 12:00 PM 3 days

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Exhibit II - State of Utah

LIST OF STATE CLEARANCE TIMES

(Rounded Dollar-Weighted Average Day of Clearance)

Clearance Times Where the Timing of A Draw Down Is Based on A Clearance Pattern

CFDA Program Name Recipient % Component Technique Rounded 

days

10.551 Supplemental 

Nutrition 

Assistance 

Program

Department of 

Workforce 

Services

100.0 Benefit--Electronic 

benefit transfer 

(EBT)

Actual Clearance, 

ZBA - Same Day 

Payment

0 Days

10.555 National School 

Lunch Program

State Board of 

Education

95.0 Vendor--Funds 

distributed by wire 

transfer

Actual Clearance, 

ZBA - ACH

1 Day

National School 

Lunch Program

State Board of 

Education

5.0 Vendor--Funds 

distributed by means 

other than wire 

transfer

USBE Composite 

Average Clearance

6 Days

12.401 National Guard 

Military 

Operations and 

Maintenance 

(O&M) Projects

Utah National 

Guard

100.0 All Funds Reimbursable 

Funding

N/A

17.225

F

Unemployment 

Insurance --

Federal Benefit 

Account and 

Administrative 

Costs

Department of 

Workforce 

Services

86.0 Benefit EFT Actual Clearance, 

ZBA - ACH

1 Day

Unemployment 

Insurance --

Federal Benefit 

Account and 

Administrative 

Costs

Department of 

Workforce 

Services

14.0 ADMINISTRATION 

FUNDS

Administration 

Costs

6 Days

17.225

S

Unemployment 

Insurance -- State 

Benefit Account

Department of 

Workforce 

Services

100.0 Benefit EFT Actual Clearance, 

ZBA - ACH

1 Day

20.205 Highway Planning 

and Construction

Department of 

Transportation

100.0 All Funds Highway P&C 

Technique

6 Days

84.010 Title I Grants to 

Local Educational 

Agencies

State Board of 

Education

91.0 Vendor--Funds 

distributed by wire 

transfer

Actual Clearance, 

ZBA - ACH

1 Day

Title I Grants to 

Local Educational 

Agencies

State Board of 

Education

9.0 Vendor & Admin.--

Funds distributed by 

means other than 

wire transfer

USBE Composite 

Average Clearance

6 Days

84.027 Special Education 

-- Grants to States

State Board of 

Education

76.0 Vendor--Funds 

distributed by wire 

transfer

Actual Clearance, 

ZBA - ACH

1 Day

Special Education 

-- Grants to States

State Board of 

Education

24.0 Vendor & Admin.--

Funds distributed by 

USBE Composite 

Average Clearance

6 Days

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means other than 

wire transfer

93.558 Temporary 

Assistance for 

Needy Families

Department of 

Workforce 

Services

42.0 Benefit--Funds 

distributed by 

electronic benefits 

transfers (EBT

Actual Clearance, 

ZBA - Same Day 

Payment

0 Days

Temporary 

Assistance for 

Needy Families

Department of 

Workforce 

Services

48.0 ADMINISTRATION 

FUNDS

Administration 

Costs

6 Days

Temporary 

Assistance for 

Needy Families

Department of 

Workforce 

Services

10.0 Inter-Agency 

Transfers

Inter-agency 

transfers (IAT)

0 Days

93.575 Child Care and 

Development 

Block Grant

Department of 

Workforce 

Services

1.0 Benefit--Funds 

distributed by 

Warrant

Average Clearance 6 Days

Child Care and 

Development 

Block Grant

Department of 

Workforce 

Services

72.0 Benefit--Funds 

distributed by EFT

Actual Clearance, 

ZBA - Same Day 

Payment

0 Days

Child Care and 

Development 

Block Grant

Department of 

Workforce 

Services

27.0 ADMINISTRATION 

FUNDS

Administration 

Costs

6 Days

93.767 Children's Health 

Insurance 

Program

Department of 

Health

99.0 Benefit EFT Actual Clearance, 

ZBA - ACH

1 Day

Children's Health 

Insurance 

Program

Department of 

Health

1.0 ADMINISTRATION 

FUNDS

Administration 

Costs

6 Days

93.778 Medical 

Assistance 

Program

Department of 

Health

98.0 Benefit EFT Actual Clearance, 

ZBA - ACH

1 Day

Medical 

Assistance 

Program

Department of 

Health

1.0 ADMINISTRATION 

FUNDS

Administration 

Costs

6 Days

Medical 

Assistance 

Program

Department of 

Health

1.0 Vendor--Portion 

distributed by 

MEDICAID warrant

Modified Average 

Clearance

6 Days

Certification

I hereby certify that an authorized State official has certified at least every five years that the "Rounded Days of Clearance" listed 

in Exhibit 2 of this Treasury-State Agreement:

1. Have been prepared in accordance with the standards provided in 31 CFR 205.20;

2. Accurately represent the flow of Federal funds under the Federal assistance programs to which they apply;

3. Reflect seasonal or other periodic variations in the clearance activities; and,

4. Are auditable.

Date: 

Printed Name: 

DocuSign Envelope ID: 7AA250E0-35F7-4FDB-886C-4FC6FC84D678

Janica Gines

6/30/2021
Page 20 of 21

Certifying Signature: 

Title: 

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Director, Division of Finance
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