TN 7 (03-99)

SI 02901.510 Estimating State Liability and Payment Methods

A. Process

1. Determination of Monthly Amount

  1. Approximately seven workdays before the end of each month, SSA estimates the amount of funds necessary to cover State expenditures for the next month and the administration fee.

  2. SSA bases the expenditures estimate on the following factors:

    • Data from the payment tape forwarded to the Treasury Department at month's end for payment of monthly supplemental security income (SSI) benefits for the subsequent month;

    • Estimate of any State liability for payments to newly eligible recipients during the subsequent month;

    • Estimate of operating adjustments in the following month such as unnegotiated check amounts scheduled for crediting;

    • The balance of State cash on deposit with SSA at the close of the prior month accounting cycle.

  3. SSA estimates each State's administrative fee based on prior months experience and anticipated increases in the number of payments.

2. Notification to State of Payment Due

  1. SSA (regional office) will notify the State of the amount due by telephone each month and follow up with a written notice approximately seven workdays prior to the end of each month.

  2. If, for any reason, State fund disbursements will exceed the cash deposit, SSA may notify the State to transfer additional funds before the month's end to cover the deficit.

3. State Requirements

The State is required to provide SSA with the names of individuals (also their titles, addresses, and telephone numbers) who should be contacted to initiate the transfer of State funds and to whom the written confirmation of the monthly payment amount due should be sent. Two or more individuals should be designated for contact in case of illness or emergency and a revised listing should be submitted by the State whenever there is a change in the designees. This identification of designees should be forwarded to the Regional Commissioner (RC).

B. Policy

1. Electronic Transfer of Funds

  1. States should arrange with their commercial bank(s) to transfer funds through the Federal Reserve System to the SSA deposit fund account. Arrangements should provide for the commercial bank to initiate the transfer of funds based on either a telephone or teletype message from the State. The State should also request its commercial bank to transmit the transfer of funds request to the local Federal Reserve Bank or Branch by telephone; if this method is not permitted within the Federal Reserve Region; it should make the request by teletype.

  2. The State should advise its commercial bank that the transfer of funds should include the following information in the transfer request:

    • Amount: $ ;

    • For Deposit to Account: Social Security Administration - SSI - Deposit Account Symbol 28x6504;

    • For Account: State of ;

    • Agency Location Code - 28040001;

    • Month for which payment is made; and

    • Transfer to the Federal Reserve Bank of New York.

2. Transfer of State Funds by Check

Those States which transfer funds by check should forward their checks to:

Social Security Administration

Chief Financial Officer - Division of Finance

P.O. Box 17042

Baltimore, Maryland 21235-0001

3. Timing the Transfer of Funds

  1. States must deposit funds in the SSA acount on the fifth business day after payments are to be made to recipients.

  2. Recipients will receive payments on the first day of each month or, when the first day of the month falls on a Saturday, Sunday, or holiday, the last workday of the preceding month.

4. State Problems

Any State problems or questions concerning the procedures for transfer of funds should be directed to the Assistant Regional Commissioner (ARC), Programs or designee.

C. Process — electronic transfer of funds

Following is a sequence of steps involving a transfer of funds through the Federal Reserve System:

  • SSA advises State of amount due;

  • State obtains necessary clearance to release funds, then telephones or wires request for transfer of funds to its commercial bank;

  • Commercial bank prepares the standard funds transfer wire message and enters this message into the Fedwire System which integrates with the Treasury Financial Communication System (TFCS);

  • <