All New York State agencies are required to provide the state's Federal Employer Identification Number (FEIN) (also known as the Taxpayer Identification Number or TIN) when dealing with the federal government. This number is used for billing purposes, grant award applications, and drawdowns of federal grant funds from the Department of Treasury.
The Department of Treasury’s Bureau of the Fiscal Service established a centralized process called the “Treasury Offset Program” (TOP) that matches federal payments to New York State against debts owed by any state agency to the federal government. Billing records for services provided by federal agencies to all state agencies contain the same FEIN or TIN that is used to draw down federal grant award funds. When a TOP match occurs, the payment is “offset” against the state’s request for federal grant funds, thereby reducing that day’s federal grant payment without regard to which state agency is drawing federal funds.
The Department of Treasury offsets have been taken against federal grant award drawdowns needed to finance critical agency programs because a debt was owed to the Federal Government by a second (uninvolved) state agency. Since the drawdown was reduced by the amount of the offset, funds to finance state payments are insufficient to reimburse the state for the vouchers that were paid.
When the offset is taken, a notice is sent to the debtor state agency. A notice may be provided to the agency whose drawdown was reduced, but not always. OSC is notified by TOP late in the day that the offset occurred. The following business day OSC requests the Proof of Debt (POD) from TOP. For accounts that are cash-managed by OSC, when an offset occurs, OSC will submit a negative AR deposit to account for the offset. For accounts that are not cash managed by OSC, the agency will be contacted by the NYS Department of Taxation and Finance’s Treasury staff.
Monthly (by the 10th) OSC will email each debtor agency and each agency whose drawdowns were reduced, a report detailing the Federal offsets that occurred for the previous month. This email will contain the information necessary to obtain reimbursement from the debtor agency. Included in the monthly email will be the following:
- A list of offsets by agency,
- Agency contact information,
- The collection report provided by TOP,
- The POD for each offset, and
- A PDF of the negative AR deposit for accounts that are cash managed by OSC.
In the rare instances that OSC has not received the POD promptly, the POD will follow in a later email once received.
Guide to Financial Operations
REV. 01/16/2025