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Statement of Administration Policy: H.R. 4279 - Intergovernmental Cash Management Improvement Act

September 20, 1990

STATEMENT OF ADMINISTRATION POLICY

(House)
(Conyers (D) Michigan and Horton (R) New York)

The Administration supports House passage of H.R. 4279. The bill provides procedures and incentives for better cash management at the Federal and State levels. Implementation of H.R. 4279 would assure the States that Federal funds would arrive on time and that States would prudently manage their drawdowns of Federal funds.

The Administration will work with the Senate or in conference to address the following concerns:

—  Payment of interest to States should only be made when the Federal Government is obligated to pay by a certain date, but has not provided the funds by that date. Payment of interest to States should not be made when States have made disbursements in anticipation of an appropriation.

—  Administrative costs incurred by States in complying with provisions of H.R. 4279 are indirect costs of a Federal program, and should be reimbursed as overhead, not as direct costs. The direct funding method would not encourage efficient administrative practices in calculating interest due.

—  Calculation of interest rates should be determined at equivalent rates to auctions, of 13-week Treasury bills, specifically during the preceding calendar quarter. Stating that interest rates are to be calculated at the equivalent rates of 13-week Treasury bills auctioned "during the period for which interest is calculated" is ambiguous. This could create substantial burdens on the Treasury Department.

George Bush, Statement of Administration Policy: H.R. 4279 - Intergovernmental Cash Management Improvement Act Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/328941

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