The Cash Management Improvement Act (CMIA) of 1990 makes the following provisions:
Federal agencies must make timely fund disbursements and grant awards to States.
States and Federal agencies must minimize the time between the transfer of Federal funds to States and the presentment of States' checks/warrants or settlement of Electronic Fund Transfer (EFT) payments for program purposes.
With minor exceptions, States are entitled to interest from the Federal Government for the time State funds are advanced for program purposes pending Federal disbursement. The Federal Government is entitled to interest from the States for the time Federal funds are in State accounts pending presentment of checks/warrants and settlement of EFT payments for program purposes.
Treasury may charge responsible Federal agencies if they are found to be egregious or repeatedly incur Federal interest liabilities. Interest charges will be paid from agency operating budgets and not amounts available for program funding.
The Reimbursement Selection and Calculation, Generation and Output processes will do the required processing to bill different customers for different Major Programs and Programs. The Reimbursement Generation process calculates the CMIA expected request date and CMIA expected Drawdown date. This information is stored in the Reimbursement History (R_REIM_HIST) table after the reimbursement output process completes the billing. If there is a difference between the expected Drawdown date and Actual Drawdown date interest is due to or from the Federal Government. The CMIA Interest Process calculates this interest. The interest is calculated based upon the CMIA method on the record. The CMIA method is determined at the point of reimbursement setup when the user specifies a CMIA Calculation method for each funding line.
The Financial Management Service (FMS) requires a State to submit an Annual Report by December 31st accounting for interest liabilities of the States most recently completed fiscal year. The reports produced by the CMIA Interest Calculation process are in compliance with those regulations set forth by FMS.