FY 2005

DATE:	June 9, 2004
SUBJECT:	Private Vehicle Mileage
EFFECTIVE DATE:	July 1, 2004
A & R CONTACT:	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Leroy Charbonneau	(785) 296-2255	(leroy.charbonneau@da.state.ks.us)
	Shirley Gilchrist	(785) 296-2882	(shirley.gilchrist@da.state.ks.us)
	Mark Handshy	(785) 296-7021	(mark.handshy@da.state.ks.us)
APPROVAL:
SUMMARY:	FY 2005 Privately Owned Vehicle Mileage Reimbursement Rates

As authorized by K.S.A.75-3203a, the Secretary of Administration has fixed the private vehicle mileage reimbursement rates for FY 2005 at:

• 17¢ per mile for privately owned motorcycle
• 37¢ per mile for privately owned automobile
• 49¢ per mile for privately owned airplane
• 44¢ per mile for privately owned specially equipped vehicle for the physically disabled (Examples of specially equipped vehicles include, but are not limited to, those equipped with hand controls or lift devices. Other situations may be evaluated on a case-by-case basis if you are uncertain about the applicability of this rate.)

These rates reflect increases in the categories of privately owned automobile and privately owned airplane.

DB:rk

DATE:	June 9, 2004
SUBJECT:	FY 2005 Subsistence Rates
EFFECTIVE DATE:	July 1, 2004
A & R CONTACT:	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Leroy Charbonneau	(785) 296-2255	(leroy.charbonneau@da.state.ks.us)
	Shirley Gilchrist	(785) 296-2882	(shirley.gilchrist@da.state.ks.us)
	Mark Handshy	(785) 296-7021	(mark.handshy@da.state.ks.us)
APPROVAL:
SUMMARY:	FY 2005 Meal Allowance and Lodging Rates

As authorized by K.S.A.75-3203a, the Secretary of Administration has fixed the rates for FY 2005 at:

Meal Allowance:    

Reduced Meals Allowance:

If the cost of meals is included within the cost of registration fees or other fees and charges paid by the agency or supplied without cost by another party, the meals allowance should be reduced as follows:

Same Day Meals Allowance:

The rates as established in accordance with K.A.R. 1-16-18(c)(3) are the same as indicated in the table above for reduced meals allowance.

Lodging Expense Limitations:

K.S.A. 75-3207a(f) provides that the daily lodging expense limitations established above may be exceeded by the lesser of either: (1) an additional 50% of the applicable lodging expense limitation, or (2) the actual lodging expense incurred.

These lodging limits continue to be applied to the lodging rate before taxes. Thus, the amount reimbursed or paid for lodging expenses may exceed the established lodging limitation by as much as the amount of associated taxes.

DB:rk

DATE:	June 25, 2004
SUBJECT:	Deletion of Sub-object Codes for Central Motor Pool
EFFECTIVE DATE:	July 1, 2004
A & R CONTACT:	Mike Lovich	(785) 296-2131	(mike.lovich@da.state.ks.us)
APPROVAL:
SUMMARY:	Deletion of expenditure and revenue sub-object codes used for central motor pool

As a result of the dissolution of the Department of Administration Central Motor Pool, the following sub-object codes are being closed effective July 1, 2004. Following are the expenditure sub-object codes being closed:
 

The following revenue sub-object codes are also being closed:

The above expenditure and revenue sub-object codes were established to capture the central motor pool Section II costs for the Statewide Cost Allocation Plan (SWCAP). Transactions currently being processed using the above codes should now utilize expenditure sub-object codes 2531, 2532, and 2533, State car expense for in-state, out-of-state, and international travel respectively. Revenue sub-object code 2099, other service charges, should be used in place of the closed revenue sub-object codes 2094 and 2096.

These revisions will be reflected in the Uniform Receipt Classification Revenue Sub-object Codes filing (PPM No. 6,002) and the Uniform Expenditure Classification of Expenditure Sub-object Codes filing (PPM No. 7,002) on the Division of Accounts and Reports web site http://www.da.ks.gov/ar/ppm/.

DB:pk

DATE:	July 2, 2004
SUBJECT:	Changes to STARS Payment Advices Required by HB 2675
EFFECTIVE DATE:	July 6, 2004
A & R CONTACT:	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Leroy Charbonneau	(785) 296-2255	(leroy.charbonneau@da.state.ks.us)
	Shirley Gilchrist	(785) 296-2882	(shirley.gilchrist@da.state.ks.us)
	Mark Handshy	(785) 296-7021	(mark.handshy@da.state.ks.us)
APPROVAL:
SUMMARY:	Changes made to STARS Payment Advices to reduce the potential for identity theft.

Section 88(p) of HB 2675, 2004 Legislative Session, includes a proviso limiting information printed on pay advices to reduce the potential for identity theft. The proviso only applies to pay advices printed by the Division of Accounts and Reports for payments made by electronic funds transfer (EFT) to state officers or employees or to individuals. Specifically, the division is to take action so the "personal identification information and payment transaction information is obscured redacted, or omitted."

The proviso impacts the pay advices created for EFT payments made through STARS. Even though the proviso is written to apply to EFT payments to state officers and employees and to individuals, modifications to the STARS pay advices must apply to all EFT payments, regardless of the vendor type, and for all agencies.

As a result of an agency survey sent earlier this spring, we will implement this proviso by making the following modifications to STARS pay advices:

• Remove the vendor number (SSN or FEIN);
• Remove the financial institution name; and
• Replace all digits, except for the last four, in the bank account number with "X".

We will implement the modified pay advices with those printed in STARS on Tuesday, July 6, 2004.

DB:JR

DATE:	July 7, 2004
SUBJECT:	Mandatory Direct Deposit for State Employee Reimbursements
EFFECTIVE DATE:	January 2005 STARS Business
A & R CONTACT:	Vendor File:
	Nickie Roberts	(785) 296-7917	(nickie.roberts@da.state.ks.us)
	Vendor Payments:
	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Paycard Questions:
	Sunni Zentner	(785) 296-7058	(sunni.zentner@da.state.ks.us)
APPROVAL:
SUMMARY:	Effective with January 2005 STARS business, all state employee travel and miscellaneous reimbursements must be made using direct deposit

Informational Circular 04-P-007, issued October 16, 2003, provided information related to the State of Kansas Paycard. The paycard program provides agencies with a method that allows all employees to participate in direct deposit, even those without a bank account. The State of Kansas Paycard Program enables the State to realize cost savings and increase efficiencies by replacing payroll checks currently issued with electronic transfer of pay to employees.

To build on the efficiencies and cost savings related to direct deposit of payroll, it has been determined that state employee reimbursements processed through STARS should also maximize the use of direct deposit. Effective with January 2005 STARS business, all STARS payments made to state employees must be made as direct deposit.

During the last December 2004 STARS nightly batch cycle, all state employee vendor records that do not contain banking information will be changed to inactive status, and will be suspended until such time as the employee's STARS vendor record has been updated to include the appropriate banking information. Those employees who do not have an account at a financial institution, or prefer to not use their existing account for STARS reimbursements, should be provided with a paycard as outlined in Informational Circular 04-P-007. All state employee travel and miscellaneous reimbursement payments processed through STARS as January business, and thereafter, must contain the appropriate payment indicator so that the payments will be made electronically.

State agency management should take steps to obtain the completed Authorization for Electronic Deposit of Vendor Payment (Form DA-130) from employees and submit them to the Division of Accounts and Reports for those employees who will be traveling, but do not have valid banking information in their vendor record. (NOTE: This form is used to deposit STARS payments only. Payroll direct deposits will continue to be authorized using Form DA-184, Authorization for Direct Deposit of Employee Pay.) It will not be necessary to take any action for those employees whose vendor record already contains the appropriate information or for those employees who will not be receiving any reimbursements through STARS.

DB:JR

DATE:	September 17, 2004
SUBJECT:	Mandatory Direct Deposit for State Employee Reimbursements
EFFECTIVE DATE:	January 2005 STARS Business
A & R CONTACT:	Vendor File:
	Nickie Roberts	(785) 296-7917	(nickie.roberts@da.state.ks.us)
	Vendor Payments:
	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Paycard Questions:
	Sunni Zentner	(785) 296-7058	(sunni.zentner@da.state.ks.us)
APPROVAL:
SUMMARY:	A reminder that effective with January 2005 STARS business, all state employee travel and miscellaneous reimbursements must be made using direct deposit

Informational Circular 05-A-005, issued July 7, 2004, provided information regarding the upcoming requirement that all state employee travel and miscellaneous reimbursements must be made using direct deposit. Effective with January 2005 STARS business, all STARS payments made to state employees must be made as direct deposit.

As noted in the earlier circular, during the last December 2004 STARS nightly batch cycle, all state employee vendor records that do not contain banking information will be changed to inactive status, and will be suspended until such time as the employee's STARS vendor record has been updated to include the appropriate banking information. Those employees who do not have an account at a financial institution, or prefer to not use their existing account for STARS reimbursements, should be provided with a paycard as outlined in Informational Circular 04-P-007. All state employee travel and miscellaneous reimbursement payments processed through STARS as January business, and thereafter, must contain the appropriate payment indicator so that the payments will be made electronically.

Since the end of June, we have added information to the STARS vendor file for 2,780 vendors to be paid electronically. State agency management should take steps to obtain the completed Authorization for Electronic Deposit of Vendor Payment (Form DA-130) from employees and submit them to the Division of Accounts and Reports for those employees who will be traveling, but do not have valid banking information in their vendor record. (NOTE: This form is used to deposit STARS payments only. Payroll direct deposits will continue to be authorized using Form DA-184, Authorization for Direct Deposit of Employee Pay.) It will not be necessary to take any action for those employees whose vendor record already contains the appropriate information or for those employees who will not be receiving any reimbursements through STARS.

DB:JR

DATE:	October 15, 2004
SUBJECT:	STARS Vendor File
EFFECTIVE DATE:	November 1, 2004
A & R CONTACT:	Nickie Roberts	(785) 296-7917	(nickie.roberts@da.state.ks.us)
APPROVAL:
SUMMARY:	Effective November 1, 2004, the bank account number will be displayed as all X's in the STARS Vendor File for all users without central access.

Over the years, we have had many questions and concerns raised by agencies and employees regarding the display of a vendor's taxpayer identification number or an employee's social security number (SSN) and any associated financial institution information in the STARS vendor table.

The vendor taxpayer identification number (SSN for individuals) is used extensively in STARS processing. Because of the way this information is used, it is not feasible to modify the system to use a substitute identification number, nor to establish a separate vendor table for each agency's use. To address this concern, we have tried to minimize the access to this information by encouraging agencies to limit the number of their staff with access to the STARS vendor table to only those persons who truly need this information to perform their jobs.

In order to address concerns regarding the security and privacy of vendor banking information stored in the STARS Vendor File, we have taken action to limit the display of the "financial institution acct no", i.e., the bank account number, to persons with central user access only. Effective November 1st, the bank account number field will display X's in lieu of the bank account number for all except those users with central access.

DB:JR

DATE:	November 16, 2004
SUBJECT:	Mandatory Direct Deposit for State Employee Reimbursements and Subsequent Reporting of Payments Made by Warrant
EFFECTIVE DATE:	January 2005 STARS Business
A & R CONTACT:	Vendor File:
	Nickie Roberts	(785) 296-7917	(nickie.roberts@da.state.ks.us)
	Vendor Payments:
	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Paycard Questions:
	Sunni Zentner	(785) 296-7058	(sunni.zentner@da.state.ks.us)
APPROVAL:
SUMMARY:	A reminder that effective with January 2005 STARS business, all state employee travel and miscellaneous reimbursements must be made using direct deposit and subsequent reporting of payments made by warrant.

Informational Circulars 05-A-005 and 05-A-006, provided information regarding the upcoming requirement that all state employee travel and miscellaneous reimbursements must be made using direct deposit. Effective with January 2005 STARS business, all STARS travel and miscellaneous reimbursements to state employees must be made as direct deposit.

We have reconsidered our initial plan to change all state employee vendor records that do not contain banking information to inactive status, during the final December STARS cycle. THIS VENDOR STATUS CHANGE WILL NO LONGER OCCUR.

The primary reason employees receive reimbursement is for travel-related expenses. In order to assist agencies in identifying employees that still need to enroll in the STARS direct deposit program, the Division of Accounts and Reports will distribute a report during the first week of December reflecting all travel reimbursements made in the month of November that were made by warrant.

We recognize that there are other miscellaneous reimbursement payments made to employees that will not be included in our monthly report, but will fall under the direct deposit policy. It remains each agency's responsibility to ensure that all travel and miscellaneous reimbursement payments are made by direct deposit. The Division of Accounts and Reports will continue to provide this information to agencies after each STARS month-end as one tool that agencies can use to ensure that all employees are in compliance with the direct deposit policy.

State agency management should continue to take steps to obtain the completed Authorization for Electronic Deposit of Vendor Payment (Form DA-130) from employees as soon as possible, and submit them to the Division of Accounts and Reports for those employees who will be receiving a reimbursement, but do not have valid banking information in their vendor record. (NOTE: This form is used to deposit STARS payments only. Payroll direct deposits will continue to be authorized using Form DA-184, Authorization for Direct Deposit of Employee Pay.) It will not be necessary to take any action for those employees whose vendor record already contains the appropriate information or for those employees who will not be receiving any reimbursements through STARS.

Those employees who do not have an account at a financial institution, or prefer to not use their existing account for STARS reimbursements, should be provided with a paycard as outlined in Informational Circular 04-P-007.

DB:JR

DATE:	November 16, 2004
SUBJECT:	Option to charge parking fees at KCI to Business Procurement Cards
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Tim Hund	(785) 368-6347	(tim.hund@da.state.ks.us)
APPROVAL:
SUMMARY:	Use K-TAG transponders to charge parking fees at KCI to BPCs

Kansas City International Airport (KCI) has recently announced an electronic Pay by Tag option (KCI QuickTag) for the payment of economy parking at the airport. Agencies may establish an account that uses K-TAG transponders to charge parking fees to the agency's Business Procurement Card (BPC).

The information summarized below is provided at KCI's website (www.flykci.com/quicktag.cfm). "The same wireless technology that enables electronic toll collection on the Kansas Turnpike can be used at the Economy Parking lots for Terminals A, B and C at KCI."

• "Enter and exit the Economy Parking facilities through designated KCI QuickTag lanes. These lanes are equipped with readers that will instantly identify" your K-TAG transponder.
• "When you exit the parking lot, the appropriate amount is electronically calculated and charged to the" BPC associated with your K-TAG.
• Your agency's BPC "statement will reflect each parking charge and will be posted as 'Pay by Tag Transcore'."

Your agency can establish KCI QuickTag accounts at the website noted above.

DB:th

DATE:	November 17, 2004
SUBJECT:	Sales Tax Exemptions
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Vendor Listing/Copies of State Exemption Certificate:
	Cheryl Stewart	(785) 296-3521	(cheryl.stewart@da.state.ks.us)
Dept of Revenue Contact:	Steven Brunkan	(785) 291-3580	(steven_brunkan@kdor.state.ks.us)
APPROVAL:
SUMMARY:	No later than January 1, 2005, a new Tax-Exempt Entity Exemption Certificate must be filed with your vendors.

In accordance with Section 21 of House Bill 2375, 2004 Legislative Session, the Department of Revenue has issued a Tax-Exempt Entity Exemption Certificate to every State agency. Each agency has been assigned a unique Kansas Exemption Number (hereafter referred to as the "agency exemption number") which is included on the certificate. The certificates were mailed with a letter of instruction to each agency's business/finance manager the week of November 7. The letter contains a PIN required for account access.

To assist state agencies in this process, the Department of Revenue has agreed to issue one number to the State of Kansas (hereafter referred to as the "state exemption number") that can be used by all agencies. It will contain the Director of Account and Reports' signature, the state's FEIN number, and include a generic description of the type of purchase. These state exemption number certificates will initially be distributed at the November 18, 2004 ASTRA meeting. If your agency will not be in attendance at this meeting, you can obtain a copy of the state exemption number certificate by contacting Cheryl Stewart as noted in the above contact information. Agencies will then provide a copy of this certificate to vendors upon request.

You must make copies of the original certificate and distribute to vendors as needed. There are no electronic versions of the exemption forms available.

In an attempt to ease the transition, Accounts and Reports will send a state exemption number certificate to vendors who have been issued a STARS payment in the last 30 days. This state exemption number can be used for all transactions in which the payment is processed through STARS. For payments that agencies make from local funds, i.e., the check/warrant has the agency name as the account holder, vendors may require an exemption certificate on file which contains the agency exemption number described in the first paragraph of this circular.

Accounts and Reports will make the listing of vendors to whom we send a state exemption certificate available to agencies on our web site. Agencies will complete an electronic request form. After the request is reviewed by Accounts and Reports staff and we have verified that the person requesting the data has a valid need for the information, we will e-mail the vendor listing in a zipped Excel file. This electronic request capability will be available by December 6, 2004.

Your agency may choose to use your agency exemption number to obtain the sales tax exemption for all or a portion of transactions processed by your agency. However, if you have no need for the agency exemption number certificate, and plan to use the state exemption number for all purchases, you should access the On-line Business Center as noted on the letter which accompanied your agency exemption number certificate and cancel your agency exemption number and destroy the original paper copy.

The exemption certificates indicate that the person authorized to sign the certificate must enter their driver's license (DL) number on the certificate. However, the Department of Revenue indicates that State agencies may use the State's FEIN on the agency exemption certificate as an alternative to the DL Number when all agency purchases are made through a central office. If an agency allows multiple divisions to make purchases, then the appropriate person in each division should sign and provide their DL number (not the FEIN) on the agency exemption certificate.

On-line, using the PIN assigned on the letter, you can report contact name and address changes, print copies of your existing certificate, or apply for a new certificate at a different location. At www.ksrevenue.org, find under "Your Business", click on "Sales Tax Exemption Certificate" and link to the On-Line Business Center. Details on this process are provided in the letter received from the Department of Revenue with your original agency exemption number.

If your agency requires an agency exemption number, and you are unable to locate the original certificate and letter, please contact the Department of Revenue and give them contact information and a mailing address to be used to send the replacement certificate.

Questions and comments regarding the sales tax exemption certificate can be directed to Steven Brunkan of the Department of Revenue.

DB:jr

DATE:	December 9, 2004
SUBJECT:	Procedures for filing 2004 Form 1099 Information Returns
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Ken Hasenbank	(785) 296-5304	(ken.hasenbank@da.state.ks.us)
APPROVAL:
SUMMARY:	Procedures for Filing 2004 Form 1099 Information Returns

Agencies of the State of Kansas are considered to be a single payer by the Internal Revenue Service (IRS) and payment information is required to be filed by one transmitter. In addition, federal laws and regulations require the filing of information returns to be submitted by magnetic media or electronically. In order to comply with the reporting requirements of the IRS and to avoid the assessment of penalties, the Division of Accounts and Reports will transmit all 2004 calendar year 1099 information returns for the State of Kansas electronically.

Some payments by state agencies are IRS reportable but are not included in the Statewide Accounting and Reporting System (STARS) or required data is not provided by STARS. These payments require unique reporting procedures. Such expenditures include certain interest payments, State Fair premiums and purchases of real property.

Locally administered interest payments exceeding $10 are to be reported on Form 1099-INT. An example of these payments is interest paid from trust funds to clients by institutions like the Department of Social and Rehabilitation Services and the Department of Corrections.

IRS regulations require the State of Kansas to report on Form 1099-S any purchases of real property exceeding $600. Additional requirements for this form include a description or address of the property and the closing date of the purchase transaction. (Rental and construction costs are not to be included).

State Fair premiums are to be reported on form 1099-MISC.

Procedures for handling 1099 information returns for calendar year 2004 are as follows:

1. Agencies that have made expenditures as described, will be responsible for the preparation and delivery of the appropriate 1099 forms to the payees prior to January 31, 2005. Do not mail forms directly to the IRS or to the Kansas Department of Revenue.
   The payer's FEIN to use for the State of Kansas is 48-1124839.
2. Agencies reporting applicable purchases of real property may submit the IRS and/or the State of Kansas copies of the 1099-S forms to the address below, and the Division of Accounts and Reports will submit this information to the IRS.
   
   For those agencies with other expenditures to report, the DA-43 form (http://www.da.ks.gov/ar/forms/), should be used if you have fewer than 20 records. If you have 20 or more records to submit they should be submitted as a text file in the attached format shown on the Non-STARS record layout form. You may submit a text file for fewer than 20 records if you want. All data should be remitted by February 16, 2005 to:
   
   Division of Accounts and Reports
   Central Accounting Services Section
   900 SW Jackson, Room 351-S, LSOB
   Topeka, Kansas 66612-1248

   Attention: Ken Hasenbank
   
   If you are submitting a text file you may submit the file via diskette or e-mail the file as an attachment to ken.hasenbank@da.state.ks.us.

3. If any agency finds it necessary to issue a corrected information return, the payee should be provided a copy as soon as possible. The IRS copy of the corrected form (marked "corrected") should be forwarded promptly to the Central Accounting Services Section of the Division of Accounts and Reports.

Attachment: Non-STARS Record layout (pdf)

DB:kh

DATE:	December 15, 2004
SUBJECT:	Direct Deposit will NOT be Required for Employee Reimbursements
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Vendor File:
	Nickie Roberts	(785) 296-7917	(nickie.roberts@da.state.ks.us)
	Vendor Payments:
	Randy Kennedy	(785) 296-2125	(randy.kennedy@da.state.ks.us)
	Paycard Questions:
	Sunni Zentner	(785) 296-7058	(sunni.zentner@da.state.ks.us)
APPROVAL:
SUMMARY:	Direct deposit for employee reimbursements will NOT be required effective with January 2005 STARS business.

Information Circulars 05-A-005, 05-A-006, and 05-A-008, provided information regarding an upcoming requirement that all state employee travel and miscellaneous reimbursements must be made using direct deposit. At this time, direct deposit of STARS travel and miscellaneous reimbursements to state employees will no longer be mandatory. HOWEVER, DIRECT DEPOSIT IS STILL STRONGLY ENCOURAGED.

The savings and efficiencies related to direct deposit of payroll, as well as STARS travel and miscellaneous reimbursements are significant. To build on these savings and efficiencies please continuously encourage your employees to enroll in the STARS direct deposit program. To assist your agency in maximizing direct deposit participation, the Division of Accounts and Reports will continue providing information listing employees who are not participating in direct deposit for the next six months.

State agency management should continue taking steps to obtain the completed Authorization for Electronic Deposit of Vendor Payment Form (Form DA-130) from employees and submit them to the Division of Accounts and Reports for employees who will receive reimbursements, but do not have valid banking information in their vendor record. (NOTE: This form is used to deposit STARS payments only. Payroll direct deposits will continue to be authorized using Form DA-184, Authorization for Direct Deposit of Employee Pay.)

Employees who do not have an account at a financial institution, or prefer to not use their existing account for STARS reimbursements, are encouraged to utilize a paycard as outlined in Informational Circular 04-P-007.

DB:jr

DATE:	February 7, 2005
SUBJECT:	Establishment of expenditure sub-object codes for military activation
EFFECTIVE DATE:	January 28, 2005
A & R CONTACT:	Mike Lovich	(785) 296-2131	(mike.lovich@da.state.ks.us)
APPROVAL:
SUMMARY:	Establishment of expenditure sub-object codes for military activation payment and military pay differential.

In accordance with Executive Order No. 05-356, the following expenditure sub-object codes have been established for use of military activation payments and military pay differential effective January 28, 2005:

• 2697     Military Activation Payments
• 2698     Military Pay Differential

These additional expenditure sub-object codes will be reflected in the Uniform Expenditure Classification of Expenditure Sub-Object filings (PPM No. 7,002) on the Division of Accounts and Reports web site at http://www.da.ks.gov/ar/ppm/.

DB:gb

DATE:	February 11, 2005
SUBJECT:	Federal Excise Tax Exemption Changes
EFFECTIVE DATE:	March 1, 2005
A & R CONTACT:	Bernie Kahler	(785) 296-2101	(bernard.kahler@da.state.ks.us)
APPROVAL:
SUMMARY:	Certain fuel purchases using Wright Express fuel cards will no longer be exempt from federal excise taxes

Effective March 1, 2005, certain fuel purchases using Wright Express fuel cards will no longer be exempt from federal excise tax. Due to changes made to federal law in the American Jobs Creation Act, beginning March 1, 2005, entities eligible to request refunds of federal excise taxes paid on certain fuel purchases are limited to either the Ultimate Vendor or the Ultimate Purchaser as defined in Sections 6421 and 6427 of the IRS regulations. Wright Express does not qualify as either the Ultimate Vendor or the Ultimate Purchaser and must rely on the participating merchants some of which will continue to offer tax exemption on State purchases and some will not. A list of the participating merchants is provided by Wright Express on their website - www.wexnews.com/tax.asp.<------- Broken link This list identifies which participating merchants will continue to offer tax exemption and those that will not.

The Wright Express Vehicle Analysis Reports received beginning with March fuel purchases will show exempt and non-exempt purchases. Agencies will make payments to Wright Express as usual. Agency payments to Wright Express will appear on the quarterly Federal Excise Tax Report - DAIRSTAX - along with other purchases made during the quarter. This report is distributed by the Division of Accounts and Reports following the end of each calendar quarter. It will be the responsibility of each agency to identify federal excise tax paid to Wright Express or to any other vendor for which a refund is due the agency. Division of Accounts and Reports will aggregate all agency requests for refund and file one refund request of excise taxes paid for all state agencies. As with the current process, upon receipt of the refund from the IRS, a distribution will be made via SOKI journal voucher back to agency funds. More information about Federal Excise Tax is available at www.da.ks.gov/fm/cmp/information/vehicle.htm under the topic Federal Excise Tax.

DB:aw

DATE:	February 15, 2005
SUBJECT:	State of Kansas Tax-Exempt Entity Exemption Certificate
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Martin Eckhardt	(785) 296-2661	(martin.eckhardt@da.state.ks.us)
Dept of Revenue Contact:	Steven Brunkan	(785) 291-3580	(steven_brunkan@kdor.state.ks.us)
APPROVAL:
SUMMARY:	Kansas Tax-Exempt Entity Exemption Certificates available in electronic format.

Individual Agency Tax-Entity Exemption Certificate (agency exemption number)
Information Circular 05-A-010 issued November 17, 2005 addressed the new Tax-Exempt Entity Exemption Certificate effective January 1, 2005. In accordance with Section 21 of House Bill 2375, 2004 Legislative Session, the Department of Revenue issued a Tax-Exempt Entity Exemption Certificate to every State agency.

The agency exemption number certificate is now available on the Kansas Department of Revenue web site in "fillable" PDF format. If your agency uses the agency exemption number you may want to retrieve the updated "fillable" version. This can be obtained at: www.ksrevenue.org.

State of Kansas Tax-Entity Exemption Certificate (state exemption number)
Information Circular 05-A-010 also addressed the Department of Revenue's agreement to issue one state exemption number certificate that can be used by all agencies.

An electronic "fillable" state exemption number certificate can be obtained by e-mail request to Steven Brunkan, in the Department of Revenue at steven_brunkan@kdor.state.ks.us.

DB:me

DATE:	February 16, 2005
SUBJECT:	Business Procurement Card (BPC) 1099 Reporting
EFFECTIVE DATE:	Immediately
A & R CONTACT:	BPC Questions:
	Tim Hund	(785) 368-6347	(tim.hund@da.state.ks.us)
	1099 Questions:
	Ken Hasenbank	(785) 296-5304	(ken.hasenbank@da.state.ks.us)
	Don Beck	(785) 296-7291	(don.beck@da.state.ks.us)
APPROVAL:
SUMMARY:	Effective with calendar year 2005, agencies are required to record all BPC purchases made under 1099 reportable subobject codes (as noted in Policy and Procedure Manual Filing 7002) in STARS for 1099 reporting purposes.

The Internal Revenue Service (IRS) issued guidelines in August 2004 related to information reporting of eligible purchases made by payment cards. These guidelines apply to purchases made on Business Procurement Cards (BPCs), and require that these purchases be included on Form 1099 Information Returns issued to vendors after the close of each calendar year.

The IRS, in Revenue Bulletin 2004-31, outlines a methodology for 1099 reporting for payment cards based on Merchant Category Codes (MCCs). We have determined that this method of reporting will not be used for state agencies. The State of Kansas will continue to identify BPC purchases subject to 1099 reporting based on a review of the detailed items purchased and the STARS Expenditure Subobject Code used for the payment. Agencies are expected to process journal vouchers (JVs) for all BPC purchases made using 1099 reportable expenditure subobject codes as identified in Policy and Procedure Manual Filing 7002. JV transactions will not be required for corporations (other than legal and medical corporations for which 1099 reporting is always required).

Agencies will prepare journal vouchers (JVs) to report the payment for the entity from which the purchase was made rather than UMB to whom the payment was made. This is done by using a transaction code of 780 with a reversal code "R" with the UMB Bank vendor number on the BPC payment on the first line and using transaction code 780 with the entity's vendor number from whom the purchase was actually made on the second line. The vendor number for the payee to be charged must be established in STARS prior to processing the journal voucher. In the comments section of the journal voucher, please type "for BPC 1099 purposes". Use JV type "Correct Payment/Receipt Prefix V & S" for these SOKI entries.

Following is a sample of the two JV lines required for each correction:

The reporting date for these JVs will be based on the BPC payment due date, i.e., transactions are to be reported in STARS for 1099 purposes based on the date the payment is due to UMB. For example, the billing cycle that ends in December will have a due date in mid-January. Therefore, these JVs for 1099 reporting purposes should be processed as January STARS transactions. Any JVs for 1099 reportable payments must be processed in the same calendar year as the associated BPC payment due date.

Agencies may choose to process these 1099 JVs summarized by vendor, provided the funding line is also the same, rather than processing a separate set of transactions for each individual BPC transaction.

Agencies may choose to submit JVs as frequently as each billing cycle or as infrequently as twice per calendar year. The first deadline to record these transactions is prior to the close of the fiscal year, making sure that transactions are entered in SOKI so that they can be included in the old fiscal year business according to the year-end processing schedule published each year. The second deadline for recording these transactions would be prior to the end of the calendar year. Agencies should ensure that transactions are entered in SOKI in sufficient time that they can be reviewed and approved by 3:00 p.m. on the last working day of December each year.

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DATE:	March 7, 2005
SUBJECT:	Federal Excise Tax Exemption Changes
EFFECTIVE DATE:	March 1, 2005
A & R CONTACT:	Bernie Kahler	(785) 296-2101	(bernard.kahler@da.state.ks.us)
APPROVAL:
SUMMARY:	The Treasury Department issued Notice 2005-24 dated February 28, 2005, that delays implementation of changes to federal excise tax exemption on gasoline purchases as amended in the American Jobs Creation Act of 2004

The Treasury Department issued Notice 2005-24 on February 28, 2005, that modifies Notice 2005-4 by extending the transitional rule related to sale of gasoline on fuel credit cards beyond March 1, 2005, until the fuel credit card rule is modified by a statutory change or by future federal guidance on this issue.

Due to the extended transitional rule period, Wright Express and its participating merchants will be permitted to continue to offer federal excise tax exempt purchases of gasoline as they did prior to March 1, 2005. Therefore, agencies should expect to continue to purchase fuel net of federal excise tax using the Wright Express fuel cards.
This Treasury Department Notice does not make a permanent change to the federal law. Agencies will be notified of further changes to this federal excise tax issue as information becomes available.

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DATE:	April 7, 2005
SUBJECT:	Closing of Fiscal Year 2005 and Opening of Fiscal Year 2006
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Annette Witt Central Accounting Services Section	(785) 296-8083	(annette.witt@da.state.ks.us)
	Steve Banning Payroll Services Section	(785) 296-7059	(steve.banning@da.state.ks.us)
	Lucinda Anstaett Office of the State Treasurer	(785) 296-4151	(lucinda@treasurer.state.ks.us)
APPROVAL:
SUMMARY:	Schedule of Accounting Events Relative to Fiscal Year Closing

This Informational Circular provides the scheduled dates for closing fiscal year 2005 and beginning fiscal year 2006. Additional information concerning fiscal year end closing and DA-118 List of Outstanding Obligations instructions is contained in the Division of Accounts and Reports Policy and Procedure Manual filing nos. 14,002 and 14,003. The Policy and Procedure Manual is located at http://www.da.ks.gov/ar/ppm/ppm01001.htm. Other web resources available for fiscal year end processing information can be found at http://www.da.ks.gov/ar/yearend/default.htm.<------- Broken link

K.S.A. 75-3002 establishes the state fiscal year as commencing on the first day of July in each year and closing on the thirtieth day of June of the succeeding year. To allow state agencies time to process as much old year business as possible, the old year records normally remain open through the second Monday of July (PPM No. 14,002). However, for the fiscal year 2005 closing, the cutoff date will be Tuesday, July 12, 2005 to allow an additional processing day. Between July 1 and July 12, the Statewide Accounting and Reporting System (STARS) will process old and new fiscal year business concurrently.

The workload both at your agency and the Division of Accounts and Reports is greatly increased during the fiscal year end closing period. We ask that you use the following reminders and guidelines to help facilitate the fiscal year end processing.

SPECIAL ITEMS

• State Treasurer cash management fees for June 2005 will probably not be billed to agencies in time for payment in FY2005 business; agencies must encumber for payment if this obligation is not paid in FY2005.
• Budget Worksheet data from STARS will be electronically loaded into the Budget Management System by August 11th.
• The dates provided on this document that relate to fiscal year closing and opening activities will be revised, as necessary, by the Division of Accounts and Reports. Any revisions to payroll encumbrance or other processing dates will be issued as a SHARP message to subscribers of the SHARP listserv. After issuance, SHARP messages are also posted on the SHARP Customer Service Website at http://www.da.ks.gov/SHARP/documents/message.htm. Revisions to STARS processing dates will be posted on the STARS News Display and notice of revisions to SOKI³⁺ processing dates will be sent via email to all users.

SYSTEM AVAILABILITY

• Normal hours of availability of STARS is 8AM to 5PM Monday through Friday; 24 hours on holidays and Saturdays, unless a special STARS cycle is requested; Sundays from 1PM through Monday, unless otherwise noted on the STARS news screen.
• SHARP is available from 7AM to 6PM Monday through Friday and 1PM to 6PM Saturday and Sunday. The cutoff for receiving SHARP interface files is 5PM.
• SOKI³⁺ system is available 24 hours a day except for a maintenance period between 7PM and 8PM daily.

GENERAL ITEMS

• FY2005 documents receive a higher processing priority than do FY2006 documents during the concurrent processing period.
• There is a two or three day period beginning the third Tuesday in July during which no daily transactions are processed.
• Transactions characterized as emergency payments requiring immediate attention during this time should be batched separately and sent to the attention of Jo Ann Remp, Division of Accounts and Reports, Central Accounting Services Section, 900 SW Jackson, Room 351-S, Topeka, Kansas.
• State agencies should review the May monthly reports and process the necessary corrections through the SOKI³⁺ journal voucher system before June 30.
• Transaction year 2005 and 2006 documents must be batched separately.

STARS ITEMS

• During the concurrent processing period, STARS batch sheets for FY2005 transaction year should have a batch date of "06/30/05", an effective date of "06/30/05" and BFY of 2005.
• During the concurrent processing period, STARS edits FY2006 transactions charged to "expenditure only" type accounts against fund level receipts (both FY2005 and FY2006). FY2005 transactions edit only against FY2005 receipts.
• The available cash in prior fiscal year "receipt and expenditure" type budget units will not be available to fund FY2006 expenditures until FY2005 is closed and balances carried forward.
• In order to check balances in STARS during concurrent processing, agencies need to remember to make the appropriate selection for "prior month".
• If your agency would like to receive reports for June business after July 1, you must ensure that the appropriate report request record is entered into STARS.

SOKI³⁺ ITEMS

• During the concurrent processing period, both FY2005 and FY2006 documents may be processed in the SOKI³⁺ system; FY2006 interfund vouchers require a BFY of 2006 for both the receipt and expenditure transactions and FY2005 interfund vouchers process as normal. FY2006 JV documents must use a BFY of 2006 throughout. The operator must choose the appropriate BFY when initiating a JV or receipt voucher during concurrent processing.
• Beginning July 14th through year-end closing, agencies should not release any SOKI³⁺ transactions with a BFY of 2005. Only transactions with a BFY of 2006 will be processed during this period.
• On July 21st, after year-end processing is complete, all fiscal year 2006 SOKI³⁺ transactions, including encumbered expenditures can be processed and released for upload to STARS.
• All SOKI³⁺ transactions not uploaded to STARS on July 13th in the final FY2005 upload will be FY2006 business; any SOKI³⁺ interfund receipt transactions will need to have BFY 2006 and any SOKI³⁺ unencumbered interfund expenditure transactions will require an encumbrance number and appropriate transaction code changes.

The scheduled dates for closing FY2005 and beginning FY2006 are as follows:

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