[Federal Register Volume 65, Number 101 (Wednesday, May 24, 2000)]
[Notices]
[Page 33736]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-13015]



[[Page 33736]]

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DEPARTMENT OF THE TREASURY

Fiscal Service


Treasury Tax and Loan Program Enhancements

AGENCY: Financial Management Service, Fiscal Service, Department of the 
Treasury.

ACTION: Notice.

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SUMMARY: This announces new applications to be available in the 
Treasury Tax and Loan program.

DATES: The new applications are effective July 10, 2000.

FOR FURTHER INFORMATION CONTACT: Walt Henderson, Senior Financial 
Program Specialist on (202) 874-6705 or [email protected]; 
Mary Bailey, Financial Program Specialist, at (202) 874-6749 or 
[email protected]; Adam Martin, Financial Program Specialist, 
at (202) 874-6881 or [email protected]; Cynthia L. Johnson, 
Director, Cash Management Policy and Planning Division, at (202) 874-
6590 or [email protected]; or Ellen Neubauer, Senior 
Attorney, at (202) 874-6680 or [email protected].

SUPPLEMENTARY INFORMATION:

A. Background

    The Department of the Treasury (Treasury) and the Board of 
Governors of the Federal Reserve System (Federal Reserve) are enhancing 
the Treasury Tax and Loan (TT&L) program by implementing two new 
applications. The current TT&L program encompasses two separate 
components--a depositary component through which Treasury collects 
Federal tax deposits and payments from business taxpayers for employee 
withholding and other types of taxes, and an investment component 
through which Treasury invests short-term operating balances not needed 
for immediate cash outlays. More than 10,500 commercial financial 
institutions participate in the TT&L depositary component, collecting 
and/or reporting almost $1.4 trillion in Fiscal Year 1999. 
Additionally, more than 1,500 of the TT&L depositaries borrow excess 
short-term Treasury operating funds by participating in the TT&L 
investment component.

B. Summary of the New TT&L Applications

    On July 10, 2000, Treasury and the Federal Reserve will introduce 
two new TT&L applications--the Treasury Investment Program (TIP) and 
the Paper Tax System (PATAX)--which will enhance the current TT&L 
program. The TIP and PATAX systems will benefit financial institutions 
by providing the following features:

--Flexibility in investment options by offering dynamic investing 
through the new TIP application. Dynamic investing allows qualified 
financial institutions to receive excess Treasury funds throughout the 
day, provided the institution has the capacity to accept the funds.
--Near real time processing throughout the day. Tax payments settled by 
TIP (paper tax payments and same day Electronic Federal Tax Payment 
System (EFTPS) payments) are credited to an institution's accounts 
throughout the day rather than at the end of the day. A more accurate 
Treasury balance leads to greater investment opportunities for 
financial institutions. Financial institutions also benefit from near 
real time account balance information because they can better manage 
their cash position.
--Electronic delivery of statements and expanded hours for same day 
electronic tax payments and for processing paper tax payments (5:00 
p.m. Eastern Time cut-off).
--Improved collateral monitoring. TIP will receive hourly collateral 
updates to help prevent deficiencies. These improvements ensure that 
Treasury's funds are always fully collateralized.

    The Federal Reserve conducted training sessions for select 
financial institutions on the new TT&L applications across the U.S. 
during February, March, and April of this year.

Additional Information

    In response to the implementation of these new applications, the 
Federal Reserve is publishing a new policy statement in this separate 
part pertaining to daylight overdrafts. Prior to July 10, 2000, 
Treasury's Financial Management Service will update the Treasury 
Financial Manual (TFM) chapters pertaining to TT&L and collateral. TFM 
chapters are available at www.fms.treas.gov/tfm/index.html.
    For more information on the new TT&L applications, please visit 
www.frbservices.org. Financial institutions may also visit 
www.fms.treas.gov/regs.html for regulations and guidance pertaining to 
TT&L, EFTPS, and collateral. Financial institutions with questions on 
the new TT&L applications should contact the TT&L National Customer 
Service Area on 1-800-568-7343.

    Dated: May 17, 2000.
Bettsy H. Lane,
Assistant Commissioner, Federal Finance, Financial Management Service.
[FR Doc. 00-13015 Filed 5-23-00; 8:45 am]
BILLING CODE 4810-35-P