CHAPTER 10. PAYMENT PROCEDURES - ANNUAL REPORTING FEES 38 U.S.C. CHS. 32, 34, AND 35

10.01 GENERAL

Payments to educational institutions for reporting fees, as provided by Pub. L. 90-77, 92-540, and 93-508, will be accomplished as specified herein. Educational institutions and joint apprenticeship training committees will be paid an annual fee of $7 for each student enrolled as of October 31 (or another established enrollment month) for training under 38 U.S.C. chs. 32, 34, and 35. Those schools that deliver advance payment checks will be paid an annual reporting fee of $11 for each veteran or eligible person. Payments will be made as soon as feasible after the end of the calendar year. These payments will be charged to appropriation 36-0151 (General Operating Expenses, VA), limitation .001, allotment restriction 3040/24-41. Cost center 3040 and subaccount 2595 are applicable. All obligation and payments for fees during a calendar year will be recorded against the fiscal year appropriation current as of the end of the calendar year. For example, all fees applicable to the 1979 calendar year will be charged to the fiscal year 1980 appropriation.

10.02 BASIS FOR PAYMENT

The school codes and other data contained in the education system master records, together with information contained in the education system training facility file, will provide the basis for automatic computation and vouchering of the annual reporting fees by the Hines DPC.

10.03 CRITERIA TO BE USED BY HINES DPC IN SELECTING RECORDS FOR PAYMENT OF FEES

a. End-of-month Hines DPC files will be used to select records for payment of the fees. The applicable month will be one which is as near the time of payment as is feasible.

b. The following general criteria are to be used to select records from the above file for payment:

(1) IHL Records. The account must have been in a running award status as of October 31, or as of payment option month if another month for which enrollment status is to be considered has been input to the Hines DPC.

(2) NCD Records. The account must have been in a running award status as of October 31, or as of the recorded option month. An exception to this criterion is for terminated records with reason code 63 (automatic termination) when the date of termination is within the 3-month period preceding October 31, or the end of the option month. (This only applies to NCD records under chs. 34 and 35.) In such cases, payments will be made. Examples are:

(a) Enrolled Into Training-March 1, 1980. Terminated DLP (reason code 63)August 1, 1980. Enrollment date used for payment of reporting fee-October 31, 1980. Payment of reporting fee will be made. (If termination date had been July 1, 1980, no payment of reporting fee would be made.)

(b) Enrolled Into Training-March 1, 1980. Terminated DLP (reason code 63)June 1, 1980. Enrollment date used for payment of reporting fee-August 31, 1980. Payment of reporting fee will be made. (If termination date had been May 1, 1980, no payment of reporting fee would be made.)

(3) Joint Apprenticeship Training Committee. The account must be in a running award status as of October 31 or the last day of the approved payment month. Other selection criteria will be the same as for NCD records; i.e., the DLP or DLC must have been within the 3 months preceding October 31 or option month. (Not applicable under ch. 32.)

(4) Flight Records. The account must be in a running award status as of October 31 or other established month. Other selection criteria will be the same as for NCD records; i.e., the DLP or DLC must have been within the 3 months preceding October 31 or option month (Not applicable under ch. 32).

(5) Correspondence Records. The account must be in an active status ("A" type record) as of October 31, or as of the end of the option month. An exception to this criterion is for terminated records with reason code 63 when the date of termination is within the 6-month period preceding October 31, or the end of the option month. (Not applicable under ch. 32) In such cases, payments will be made. Examples are:

(a) Enrolled Into Training-January 1, 1980. Terminated DLP (reason code 63)April 1, 1980. Enrollment date used for payment of reporting fee-September 30, 1980. Payment of reporting fee will be made. (If termination date had been prior to April 1, 1980, no payment of reporting fee would be made.)

(b) Enrolled Into Training-January 1, 1980. Terminated DLP (reason code 63)July 1, 1980. Enrollment date used for payment of reporting fee-October 31, 1980. Payment of reporting fee will be made. (If termination date had been April 1, 1980, no payment of reporting fee would be made.)

10.04 VOUCHER AND PAYMENT

a. A computer-generated voucher will be produced, together with supporting listings of eligible students in each institution for payment of the fees. The voucher will be used by the Hines DPC to record payments through the Kansas City [TRFC] for all institutions except those within the Manila regional office area of jurisdiction. The listings of eligible students enrolled in institutions within the Manila area of jurisdiction will be forwarded to that office for payment.

b. The above-mentioned supporting listings in duplicate, broken down by institution, will be furnished each applicable regional office by the Hines DPC. These detailed listings will support the total dollar reporting fee being paid to the institution. The regional office will forward one copy of the listing without delay to each application institution so as to coincide as nearly as possible with the institution's receipt of the corresponding check. The other copy will be retained for use by the regional office.

10.05 PAYMENTS NOT MADE BY INITIAL CHECKS

a. In some instances, due to various reasons, eligible students may be omitted from the listings described in paragraph 10.04 above, and the initial payments would not include fees for these students.

b. A separate detail listing will be provided regional offices by the Hines DPC for any institution or school code where payment could not be made for any reason. A coded reason for nonpayment will be shown as follows:

Code Reason

S Individual master record failed to match a facility file record.

N Facility has not been approved.

M Manila case.

A Address of facility too long for automatic check writing, or incomplete.

c. The facility name, address and school code for the above will be verified. Any necessary corrections in the master record facilities file will be initiated by the Adjudication Division. The listing will then be used by the regional office for requesting the Hines DPC to effect payment as provided in paragraph 10.06 below.

10.06 ADJUSTED PAYMENTS

a. General. All adjusted payments, including those applicable to institutions for which initial payments were not made, will be effected by the Hines DPC, except those payments to institutions located within the Manila regional office area of jurisdiction, which will be effected by that office. Payments will be based on the amount approved as specified herein.

b. Payments Not Initially Made. As noted in paragraph 10.05 above, instances may occur when no payment is initially made to an institution. An example is when the address of the institution is too long for automatic check writing or the address is incomplete. In such instances, the listing should be corrected as necessary. A copy of the listing will be forwarded to the institution together with information that the payment is being made. It should not be necessary to review the individual student's records in these instances. In other instances, initial payments will have been made and these listings will include only those students for which payments were not made. The regional office will review the listings and determine the propriety of payment. The listings may be corrected or expanded by pen as necessary. Corrections may be effected by adding or deleting students' names or adjusting the amounts by lining out the incorrect amounts and inserting the proper amounts at the top or side, etc. The completed listing, when in proper order for payment, will be processed as follows:

(1) An administrative voucher number will be assigned. This number will consist of the letters "RF" (reporting fee), the approving regional office three-digit symbol; i.e., "313" and a number beginning with "1," and continuing consecutively for all listings processed for the fiscal year. This number will be posted on the listing, preferably to the right of date of enrollment. The foregoing example will appear as RF-313-1. This number will provide identification of the submitting regional office and reference for followup purposes.

(2) The following notification will be endorsed on the listing: I certify that a reporting fee in the amount of (amount) is due and proper for payment." It will be signed by an authorized certifying officer who will sign over that title and also indicate the date of signing.

(3) Regional offices will schedule the certified listing(s) on an SF 1166(OCR), Voucher and Schedule of Payments. Continuation of payments will only be scheduled on an SF 1167(OCR), Continuation Sheet, when applicable. The scheduling will consist of inserting in the applicable blocks (a) the administrative voucher number (b) the payee, the payees address and (c) the amount. The payment identification will be "VA Edu Report Fee 19." The other information called for by the SF 11 66 and SF 1167, if applicable, will be inserted by the Hines DPC. Heading information on the SF 1166 and SF 1167 should be as follows:

(a) Department or Establishment: Veterans Administration.

(b) Bureau or Office: Data Processing Center.

(c) Location of Transmitting Office: Hines, Illinois.

(d) Authorized Certifying Officer: Leave Blank.

(e) Appropriation Summary: Leave Blank.

(f) Agency Station Number: 36-00-1200

(g) Schedule Number: Leave Blank.

(h) Grand Total: Enter Correct Amount.

(i) Administrative Voucher Number: See subparagraph (1) above. This number will also be shown on the SF 1166 and SF 1167, if applicable, under the Voucher Number block.

NOTE: Payments scheduled incorrectly and/or scheduled on Non-OCR forms will be returned to regional offices by the DPC for proper scheduling.

(4) The partially completed SF 1166 and SF 1167, if applicable along with the certified listing(s) will be forwarded to the Hines DPC using the address indicated in paragraph 10.07 below.

NOTE: Regional offices will retain a copy of the certified listing(s) for reference purposes. Additional copies may be prepared as needed.

c. Processing by the Hines DPC. Upon receipt of the properly scheduled SF 1166 and SF 1167, if applicable, the Hines DPC will complete the following actions:

(1) Insert the necessary information under the heading at the top of the SF 1166 and SF 1167;

(a) Authorized Certifying Officer.

(b) Appropriation Summary.

(c) Schedule Number.

(2) Sign as to the availability of funds, record the disbursement in the proper accounts and forward the schedule to the Chicago [TRFC] for payment.

d. Adjustments of Amounts Previously Paid. In some instances, the institutions may advise that amounts of payments received were incorrect. Regional offices will be responsible for determining the amounts proper for payment. Retained copies of listings supporting initial payments furnished regional offices, together with any subsequent adjustment documentation, should be used as a basis for determining amounts of further payments. The letter or other document from the institution informing the regional office of the incorrect payment will serve as the claim. Such documents must identify the students and contain other information essential to determining the propriety of paying the reporting fee. VA personnel may add information to the document by pen as may be necessary so that it will constitute a complete record. Normally, the identification of the student should not be added by VA personnel. The document from the school constituting the claim will be processed as is prescribed for listings in subparagraphs b and c above. If amounts paid were in excess of amounts due, receivables will be established by the regional offices, as provided by paragraph 10.10 below.

10.07 MAILING ADDRESS

SF 1166 (OCR's) and SF 1167 (OCR's) if applicable, covering payment of reporting fees, whether original payment or issuance of an adjusted payment, should be addressed to:

VA Data Processing Center (353)

Lock Box 66303

A.M.F. O'Hare, Ill. 60666

10.08 PAYMENT FOR DELIVERY OF EDUCATION LOAN CHECKS TO EDUCATIONAL INSTITUTIONS

a. General. The following procedures must be used to effect payment of an annual reporting fee to educational institutions which have delivered education loan checks to borrowers.

b. Basis for Payment. VA Form 4-5220a, Certification of Delivery of Education Loan Payment (VA copy 1), signed and returned to regional offices for the period December 1 through November 30, will provide the basis to effect payment of an annual reporting fee by the Hines DPC. A reporting fee of $11 will be reflected on the annual reporting fee payment for the applicable calendar year to each institution.

c. Regional Office Procedures. The regional office will prepare a list(s) of all VA Forms 4-5220a (VA copy 1) on hand utilizing VA Form 7051D, Data Sheet. The list(s) with a covering VA Form 3230, Reference Slip, identifying the forms as 'List of Loan Students for 19__ Annual Reporting Fee" will be mailed to Hines DPC, A&C Division (362).

(1) Preparation of VA Form 7051D, Data Sheet. Finance activities will provide the Hines DPC with necessary information in the format below:

LOAN NUMBER FIRST COLUMN LEFT SIDE (UNNUMBERED)

FILE NUMBER

CLAIM 2 - 9

SOCIAL SECURITY I - 9

PAYEE NUMBER 10 - 11

BLANK 12

PAYEE STUB NAME 13 - 19

BLANK 20

RO NUMBER 21 - 22

BLANK 23

FACILITY CODE 24 - 31

(2) Payment Identification. Each student for whom the educational institution is being paid a reporting fee for loan payment check handling, will be identified on the "pay list" or "no pay list" by an asterisk (*) immediately after the regional office code. Regional offices will retain a carbon copy of these list(s) for reference purposes.

(3) Transmittal of Data to Hines DPC. Regional offices will release the list(s) as specified in subparagraph c above. The list(s), which will include all VA Forms 4-5220a (VA copy 1) received through November 30, are to be transmitted to the Hines DPC, Analysis and Control Division (362), no later than 10 a.m. on the first workday of December of each year. Negative reports are required. All VA forms received after November 30, will be held in a separate file for submission of the next annual reporting fee payment.

10.09 RETURNED CHECKS

a. Treasury checks returned to regional offices will be processed in accordance with existing instructions contained in M P-4, part 1. Checks returned to the Kansas City or Chicago [TRFC] will automatically be canceled and recorded in the Hines DPC accounts. The Hines DPC will notify the applicable regional office of the cancellation by providing a copy of the canceled check along with a covering VA Form 3230, Reference Slip, stating the reason for cancellation. Notice of check cancellations received will be processed as follows:

(1) Determine the disposition of the check proceeds. If it is determined that payment is due the institution, whether it be the same amount paid or a different amount due, regional offices will prepare an SF 1166(OCR) as outlined in paragraph 10.06 above. The copy of the canceled check provided by the Hines DPC will be attached to the copy of the SF 1166 retained by the regional office for record purposes.

(2) A memorandum will be prepared and will accompany the SF 1166 for processing to the Hines DPC. A copy will be retained by the regional office. The memorandum will contain the following:

(a) Brief statement as to the reason for check return.

(b) Canceled check information.

(c) The administrative voucher number(s) of previously certified SFs 1166 and SF's 1167, if applicable, pursuant to which the canceled check was issued and the date it was certified by the regional office certifying officer. This provision only applies when the regional office has a previously certified SF 1166 and SF 1167, if applicable, for the canceled check(s).

(d) A statement by the regional office certifying officer: "I certify that a check should be issued for (amount) which is a correct and proper amount for payment." This statement must be signed over the title of the authorized certifying officer and dated.

(3) Previously certified SFs 1166 and SF's 1167, if applicable, issued by the regional office will be annotated to clearly establish that the check issued was canceled.

b. The regional office will advise the institution of the amount found to be due and actions being taken to effect proper payment.

10.10 RECEIVABLES/COLLECTIONS

a. Receivables created as a result of the above payments will be recorded in the regional office accounts. OF 1114, Bill for Collection, will be prepared for recording in the accounts and for collection action purposes. Reference M P-4, Part 1, Chapter 5, "Claims Collection Policy."

b. Collections received resulting from overpayments and/or refunds returned by educational institutions will be deposited in station suspense appropriation 36F3875. These funds will then be transferred to the Hines DPC using VA Form 44564, Transfer of Disbursing Authority. The "Remarks" section of VA Form 4-4564 will appropriately be annotated clearly describing the type of transfer. For example: Collection School Reporting Fee Bill Number _______________ and/or Refund by (name of school) School Reporting Fee.

10.11 PAYMENTS BY MANILA REGIONAL OFFICE

a. General. The procedures in this chapter are applicable to the Manila regional office, except for necessary modification to provide that all payments be made locally in peso equivalent.

b. Initial Payments. Upon receipt of the listings from Hines DPC reflecting the number of eligible students enrolled in each institution, local payments will be effected. One copy of the listings will be utilized to support the voucher payment. The other copy will be forwarded to the applicable institutions.

c. Adjustment Payments. All adjusted payments, including establishment of receivables, applicable to institutions within the Manila regional office area of jurisdiction will be processed by that office.

10.12 WITHHOLDING OF ANNUAL REPORTING FEES

a. Established procedures are to be used to determine the conditions under which Annual Reporting Fees are to be offset to satisfy a School Liability Indebtedness.

b. In the event that offset of annual reporting fees is to be accomplished, the Finance activity will notify the Education Compliance Survey activity by memorandum at the end of the year that a school liability exists. The memorandum will state that annual reporting fee payments are to be withheld from the institution. The memorandum should also request that a VA Form 22-8371, Compliance Survey and Facilities Code Sheet, be prepared and submitted to the Hines DPC using the reporting fee bar code "D." This code sheet must be submitted to arrive at Hines DPC no later than 5 days prior to updating the facility file in December each year as shown in the schedule of operations. The use of this code will prevent automatic payment to the institution.

c. The institutions not paid as a result of the input of code "D" will appear on the "list of schools not paid." These institutions will appear on the listing under code "L."

d. After receipt of the "list of schools not paid," the offset will be accomplished as follows:

(1) A memorandum will be prepared and submitted to the Finance Division, Hines DPC to accomplish the offsets. The memorandum will cite the name of the educational institution(s), the facility code file number(s) and the amount(s) to be withheld from the reporting fee payment. In addition, an SF 1166(OCR) will be prepared as indicated in paragraph 10.06 above for any amounts due the institution(s) after the appropriate offset, if applicable (NOTE: Do not use an SF 1167 (OCR) for other than to continue payment.) Payments other than offsets will not be included in this group. To the extent possible, the memorandum and SF 1166 (OCR's) if applicable, will be submitted to the Hines DPC during the month following the month of receipt of the "list of schools not paid."

(2) The part of the "list of schools not paid" which is applicable to school liabilities will be forwarded as a supporting document with the SF 1166(OCR) (NOTE: Listings must accompany the memorandum for those institutions not due any payment after offset) to the Hines DPC. The supporting document will be certified by the authorized certifying officer as to the amount approved for payment from appropriation 36-0151. The amount for credit to appropriation 36X0137 should also be indicated in the certification block. This is necessary in order for the Hines DPC to make appropriation accounting transfers.

(3) The amount of the offset will be returned to the initiating station by Hines DPC by use of SF 1081, Voucher and Schedule of Withdrawals and Credits. The appropriate facility codes and amounts of the offsets will be annotated on each SF 1081 for control purposes.

(4) The Finance activity will prepare a letter advising the institution that the school liability has been withheld from the annual reporting fee payment. The letter will explain the circumstances and will be mailed directly to the institution. If the institution is due any amounts after the offset, they will also be advised that the check for the difference will be received shortly.

e. The code "D" will be automatically purged each year from the facility file after issuance of the "list of schools not paid." It will be necessary to reestablish the code "D" each year if an offset from the annual reporting fee payments is appropriate.

f. Hines DPC Procedures. A SF 1081, Voucher and Schedule of Withdrawals and Credits, will be completed in accordance with MP-4, part V, paragraph 2C.04. Appropriation 36-0151 will be shown in the "withdrawal from" and 36X0137 as the "pay to" appropriation. The reference section will he completed to show the facility codes and amounts offset for each institution.