The procedures that follow pertain to the refund or return of federal funds to the US HHS due to:

• Excessive cash balances on deposit that are not needed for program purposes;
• Unspent “advance” funds for awards that are closed;
• Monies returned by grant recipients due to audit disallowances;
• Cost reallocations (Expenditure Adjustment Journal transactions crediting federal funds);
• Any other accounting adjustment that results in an increase in federal fund cash that will not be immediately disbursed for program purposes and therefore must be returned to the U.S. Treasury.

In all such instances, the award is considered closed. This process should not be used for awards that are open for draws and returns via the Payment Management System (“PMS”) draw system. Please note that while an agency might consider an award closed, the award may not have been closed out by the awarding agency in the applicable draw system. If the award is open in the PMS, and OSC draws on your behalf, this return will be processed through PMS, and if the intent is for a refund to be issued separate from the normal draw process, this needs to be communicated to [email protected] prior to entering any transaction that would bill against the award.

REGULAR PAYMENT VOUCHER

To generate an electronic refund of federal funds to the U.S. HHS, it is necessary for agencies to prepare and submit a Regular Payment Voucher. Before the agency submits the voucher, the agency MUST first ensure the cash related to the refund has been posted in SFS. In some cases, funds to be returned will be recorded via an Adjustment Voucher. In other cases, the funds are excess cash from a previous federal payment or adjustment. Under no circumstances should a refund be paid to the federal government until the related funds have been posted in SFS.

In the case of an audit disallowance, or any scenario where there is no new cash being posted to SFS, and an expenditure is being moved from a federal funding source to another source, the movement of this expenditure must be done prior to submitting the voucher for the return of cash to the federal government. This should also be communicated to [email protected] to ensure no returns are mistakenly processed through PMS.

Amounts that are to be returned must never be charged to an appropriation that was provided to control grant expenditures since such charges are reported to the government as a use of grant funds. Refunds and returns back to the Federal government are not State expenditures and, therefore, must be recorded as a reduction of federal grant revenues. If returns are charged to expenditure account coding, reported expenditures and disbursements on SFS reports would be affected.

Any further questions concerning the required return of monies to the federal government should be directed to the OSC Bureau of State Accounting Operations (BSAO), Federal Payment Management Team at [email protected].

Refund Voucher - Required Information

• Voucher Style – Regular Voucher
• Pay Terms – 00 (Due Now)
• Invoice Number Field – This should include the PMS Payee Account Number (PAN), PMS Document Number as well as the reason for the return (generally refund). Agency staff can determine their awards PMS PAN and PMS Document Number by running the “NY_OSC_Draw_System_Attributes” query in SFS. User 6 field in the query shows draw system. This procedure relates only to PMS drawn awards. User 7 field denotes the PAN for PMS awards and user 9 field (reference award number) denotes the PMS Document Number. The limitation on this field is 30 characters. An example of this would be C1234P – 1705NY3007 – Refund. ‘Refund’ can be shortened if your PMS PAN/Document ID/Reason is too long for the field.
• Location – LOC01
• Payment Note Box on the “Payments” tab - At a minimum, the following information must be provided:
  • Reason for the refund;
  • The revenue chartstring values where the refund/receipt was deposited. (Note the revenue chartstring must include the following fields at a minimum: Fund, Account (36121), PCBU, Project and Activity. This chartstring must represent EITHER where a refund check was deposited via Refund of Appropriation (ROA) OR the corresponding chartstring where expenditures have been moved off an award and the return of funds is unable to be processed through the normal draw process).
  • The voucher ID of the ROA or the journal ID that was used to deposit the refund/receipt into the SFS.
• Distribution Lines Coding - All refunds of excess or unneeded federal fund balances will be paid from the Comptroller's Refund Account (Fund 70200) and are charged to the following statewide ChartField values.

Once the voucher is audited, approved, and paid by OSC – Bureau of State Expenditures, the OSC - BSAO Revenue Unit will debit the federal revenue chartstring as listed in the Payment Note Box, which funds the payment of the voucher out of the Comptrollers Refund Account.

Guide to Financial Operations

REV. 05/16/2024