**Technology Modernization Fund (Thereafter TMF) Background:**

GSA’s Technology Modernization Fund (TMF) (TAFS 047X0616) received a $100 million appropriation derived from the General Fund of the United States pursuant to Public Law 115-141 (132 STAT. 571) enacted in March 2018 and an additional $25 million appropriation pursuant to P.L. 116-6.

The fund was authorized by the Modernizing Government Technology Act of 2017 to fund projects for technology-related activities to improve information technology and enhance cybersecurity across the Federal government. Agency projects that are approved by the Technology Modernization Board (https://tmf.cio.gov/board/) are eligible to receive funding in the form of SF 1151: Non-expenditure Transfer Authorization. Projects recommended for funding by the Board receive incremental funding contingent on the successful execution of milestones. This funding could be full or incremental funding based on an agreed-upon schedule, detailing both the transfers-out (non-expenditure) and repayments to GSA (expenditure). Repayments, in accordance with the written agreement, must occur within 5 years of the last transfer-out to the recipient agency. More detailed information is available at https://tmf.cio.gov/.

In the repayment process, GSA will assess and collect an administrative fee on each repayment made, to recover the costs of administering the program, in accordance with the original/amended repayment schedule.

**Addendum 1: TMF Guidance Amended June 2021:**

The Technology Management Fund (TMF) was created in 2018 by Public Law 115-141 (132 STAT. 571). The TMF receives additional funding occasionally as new public laws are enacted. In March 2021 pursuant to the American Rescue Plan (ARP) Public Law 117-2 (135 STAT. SEC. 4011), TMF (TAFS 047 0616 2021/2025) received a $1 Billion appropriation derived from the General Fund of the Treasury. As with other funds authorized by the Modernization Government Technology Act of 2017, agency approved projects for ARP will receive funding in the form of SF-1151 Non-Expenditure Transfer Authorization. The Budget Authority for the TMF ARP program is classified as Mandatory. The funding can be full or incremental. The agreed upon schedule and Interagency agreement will detail both the transfer out (non-expenditure) and repayments to GSA (expenditure).

Repayments, in accordance with the written agreement, must occur within 5 years of the last transfer-out to the recipient agency. More detailed information is available at https://tmf.cio.gov/.  Additionally, the Modernizing Government Technology Act (MGT Act) does not require agencies to reimburse the TMF on a full cost recovery basis. The MGT Act permits partial or minimal repayment for TMF transfers if the repayments are sufficient to ensure solvency of the fund.

*The automatic apportionment authority in section 120.41 of Circular A-11, which automatically apportions newly enacted full year appropriations, does not apply to amounts appropriated in ARP.

****Please see the Appendix to view additional Illustrative Transactions for TAFS 047 0616 2021/2025 (ARP) transfers.**

**Addendum 2:  TMF Accounting Guidance for Expenditure Transfer (Rare Situations) Amended 2023**

The Technology Modernization Fund has approved budget authority to transfer to trust funds.****Please see Addendum 2 section of this document for transactions to be reported for this type of scenario.

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**Scenario Assumptions:**

Note: This example is illustrative and is intended to provide context and a frame of reference.

1. Amounts are presented in the thousands of dollars.

2. TMF anticipates $38 million in transfers of current year authority to agency recipients. GSA’s TMF receives an approved apportionment from the Office of Management and Budget that includes anticipated transfers of current year authority of $38 million of transfers out in FY 2018.

3. In year one, the TMF Board approves a $7 million project to modernize a recipient agency’s, Agency-Alpha, email system (implement new email system and sunset legacy email system). The recipient agency receives the non-expenditure transfer in a no-year Treasury Appropriation Fund Symbol (TAFS) that is required to be repaid to GSA’s TMF in accordance with the repayment schedule. There will be one non-expenditure transfer-out to the recipient, and two annual repayments starting in the 1st year after the initial funding from GSA.

4. In year two, the recipient agency will repay GSA’s TMF with unobligated balances from a prior appropriation.

5. In year three, the recipient agency will receive a new appropriation in a separate TAFS (Beta) that will be used to repay GSA’s TMF. Also, the recipient agency will return $500,000 of unused authority to the TMF via SF 1151: Non-expenditure Transfer Authorization from Agency-Alpha’s TAFS to GSA.

6. Typically, repayment will occur over 5 years. In this example, repayment will occur over 2 years starting in the fiscal year after the initial funding.

7. In addition to the project cost, GSA will be paid a flat 3.0% fee for administrative costs. The fee will be added to each of the two annual repayments. In this scenario, the fee will be $210 in total ($7,000 x 0.03).

Principal Repayment =	$3,500x 2 = $7,000

Fee Assessed/Collected =	210 (210 /2 = 105)

Total Collected =	$7,210

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**Illustrative Transactions:**

**Year 1:**

1. **Year 1 - Beginning Trial Balance (Summary):**

2. **Year 1 - June (AP 09) – Funding Received**

1 Attribute domain value referenced with budgetary USSGLs in this document will reflect the appropriate Reimbursable Flag Indicator.

2 Attribute domain value referenced with proprietary USSGLs in this document will reflect the appropriate Fed/Non-fed Indicator.

3. **Year 1 - July (AP 10) – Approved Apportionment Received from OMB for both GSA and Alpha-Agency**

4. **Year 1 - August (AP 11) – Project Approved and Transfer-Out Processed and Agency-Alpha receives subsequent allotment.**

3 Due to the proprietary modifications to TC’s A476 and A472, the Technology Modernization Fund and the recipient entities TAFS is expected to fail GTAS Edits 35 and 36, respectively. Both entities must submit GTAS Edit override requests to GTAS.Team@fiscal.treasury.gov to receive an override due to this transaction. TC’s A472 and A476 are being modified to allow for consistent accounting treatment throughout the life of GSA’s Technology Modernization Fund.

5. **Year 1 - August (AP 11) – Budget Execution to modernize “approved TMF project”.**

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6. **Year 1 - Pre-Closing Entries - September (AP 12)**

7. **Year 1 - Pre-Closing Adjusted Balances (Summary):**

8. **Year 1 - Closing Entries – September (AP 12)**

9. **Year 1 - Closing Adjusted Balances (Summary):**

**Year 2:**

10. **Year 2 - Beginning Trial Balance (Summary):**

11. **Year 2 - November (AP 02) – Alpha-Agency decides to use unobligated balances not derived from GSA transfers to repay GSA. Approved Apportionment from OMB and allotment subsequently received.**

12. **Year 2 - November (AP 02) – GSA Receives Approved Apportionment reflecting Anticipated Collections from Alpha- Agency for repayment.**

13. **Year 2 - (AP 08) – Actual collections received from Agency-Alpha in May of Year 2 via IPAC, including 3.0% fee ($3,500 x 3.0% = $105).**

4 Only record transaction B2	Treasury Appropriation Fund Symbols that receive amounts appropriated from the General Fund of the U.S. Government

via Treasury Appropriation Warrant.
n

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14. **Year 2 - Pre-Closing Adjusted Balances (Summary):**

15. **Year 2 - Closing Entries**

16. **Year 2 - Closing Adjusted Balances (Summary):**

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**Year 3 :**

· The TMF Recipient Entity will repay GSA’s TMF $500,000 of unused authority out of the Agency’s Alpha TAFS via SF 1151: Non-expenditure Transfer Authorization (transactions 18 and 19). **THIS TRANSACTION DOES NOT CONSTITUTE A REPAYMENT.**

· The TMF Recipient Entity will receive a new appropriation in a separate TAFS (Beta) to repay GSA the remaining balance. A transfer of accounts payable from the TMF Recipient Entity is necessary (transactions 20-22)5.

17. **Year 3 - Beginning Trial Balance (Summary):**

5 If the appropriation is received to the same TAFS that originally received the non-expenditure transfer from GSA’s Technology Modernization Fund, then disregard transaction #22.

18. **Year 3 - November (AP 02) – Approved Apportionment Received from OMB for both GSA and Alpha-Agency to transfer back unobligated balances which were originally provided for “approved TMF project” in year one to GSA via SF 1151: Non-expenditure Transfer Authorization.**

19. **Year 3 - November (AP 02) – Project Approved and Transfer-Out Processed and Agency-Alpha receives subsequent allotment.**

6 Due to the proprietary modifications to TC’s A476 and A472, the Technology Modernization Fund and the recipient entities TAFS is expected to fail GTAS Edits 35 and 36, respectively. Both entities must submit GTAS Edit override requests to GTAS.Team@fiscal.treasury.gov to receive an override due to this transaction. TC’s A472 and A476 are being modified to allow for consistent accounting treatment throughout the life of GSA’s Technology Modernization Fund.

20. **Year 3 - November (AP 02) – The TMF Recipient TAFS (Beta) Receives Annual Appropriation and Treasury Appropriation Warrant to Repay GSA. Approved Apportionment from OMB and allotment subsequently received.**

21. 	**Year 3 - November (AP 02) – GSA Receives Approved Apportionment reflecting Anticipated Collections from Alpha- Agency for repayment.**

22. **Year 3 - May (AP 08) – The TMF Recipient Entity transfers the accounts payable from TAFS Alpha to TAFS Beta.7**

7 If the appropriation is received to the same TAFS that originally received the non-expenditure transfer from GSA’s Technology Modernization Fund, then disregard transaction #22.

23. **Year 3 - May (AP 08) – Actual collections received from Agency-Alpha which included the 3.0% fee summarized in the original agreement.**

8 Only record transaction B234 in Treasury Appropriation Fund Symbols that receive amounts appropriated from the General Fund of the U.S. Government via Treasury Appropriation Warrant.

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24. **Year 3 - Pre-Closing Adjusted Balances (Summary):**

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25. **Year 3 - Closing Entries – September (AP 12):**

**TMF Recipient Entity**

**GSA Technology Modernization Fund**

26. **Year 3 - Closing Adjusted Balances (Summary):**

Appendix:

**Addendum 1:**

**Scenario Assumptions:**

C**onsider previous scenario assumptions applied to example below. Funds will be transferred from the American Rescue Plan -ARP- 047 0616 2021/2025.  Repayments are reduced. Fees are NOT included.**

Note: This example is illustrative and intended to provide context and a frame of reference. The additional items are included where changes in SGL postings or processes are needed.  Not all SGL postings need change.  

Total Transfer Amount: 	$7,000

Principal Repayment =	$500x2 = $1,000

Fee Assessed/Collected =	0

Total Collected =	1,000

Total forgiven=	6,000

**Item: 4. (A) Project approved. Transfer out processed with flexible payments.**

Due to the proprietary modifications to TC’s A476 and A472, the Technology Modernization Fund and the recipient entities TAFS is expected to fail GTAS Edits 35 and 36, respectively for 131000/101000 and 101000/299000. Both entities must submit GTAS Edit override requests to GTAS.Team@fiscal.treasury.gov to receive an override due to this transaction. TC’s A472 and A476 are being modified to allow for consistent accounting treatment throughout the life of GSA’s Technology Modernization Fund.

In some cases, GSA will not receive full repayment. The receivable due back is reduced to the amount in Interagency agreement. The unexpended appropriations transferred out/in equals to the forgiven amount.  Fees are not included. Budget SGL accounts are not impacted. If full repayment is made, 131000/101000 (only) is used to transfer out.

**Item 5. (A) Record Disbursement of funds not accrued**

13. **(A)  Year 2 - (AP 08) – Actual collections received from Agency-Alpha. No fee is included.**

**Addendum 2:  TMF Accounting Guidance for Expenditure Transfer (Rare Situations) Amended 2023**

The Technology Modernization Fund has approved budget authority to transfer to trust funds. In this case an agency will receive funds via expenditure transfer (e.g., to a trust fund). GSA will process the transfer via Intra-Governmental Payment and Collection (IPAC).  

TMF receives $200M in funding and the Trust Fund Agency requests $5.2M. TMF Board approves $5.2M, with flexible repayments of approximately 25% over 5 years beginning Year 2.

**Closing Entries (Year 1):**

**Closing Entries (Year 2):**

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