10-P-027 Discontinuation of Employer-Sponsored Payroll Savings Bond Programs by U.S. Department of Treasury
|May 26, 2010
Discontinuation of Employer-Sponsored Payroll Savings Bond Programs by U.S. Department of Treasury
|June 11, 2010
Employee Payroll Savings Bond Program and Deductions Ending Effective June 11, 2010
The Division of Accounts and Reports was recently notified that the U.S. Department of Treasury has announced that it will stop issuing paper savings bonds through employer-sponsored payroll savings plans. The paper savings bonds that have been issued through the payroll savings bond program will continue to be valid issues of the U.S. Treasury and will remain available for purchase at financial institutions.
The notice indicated this change is being made to reduce the costs associated with the U.S. Savings Bond Program and to support the Treasury’s long-term plan to issue all securities electronically. Employers are required to discontinue existing employer-sponsored payroll savings bond programs to coincide with this change.
In accordance with this directive, the final payroll deduction for any employee currently enrolled in the payroll savings bonds program will occur on the paycheck dated June 11, 2010. The Division of Accounts and Reports will make the necessary updates to end all employee payroll savings bond deductions in SHARP effective with the June 25, 2010 paycheck. Regent institutions are responsible for making the necessary changes to end savings bond deductions in their individual payroll systems.
Following the processing of the final savings bond purchase for the deductions withheld through June 11, 2010, Payroll Services will identify balances that remain in the Savings Bond Log for employees who have accumulated deductions that were not sufficient to purchase the selected bond denomination. Agencies will be notified of their employees with an outstanding savings bond balance, including the balance amount. This notification is planned for distribution to the agencies via email on Tuesday, June 8, 2010. On Monday, June 14, 2010, Payroll Services will be ending all savings bond deductions in General Deduction Data in SHARP for all employees using a deduction end date of May 30, 2010.
Agencies will also have a new report available in their MVS mailbox on Tuesday, June 15, 2010 that will identify which active employees had their bond deduction ended by Payroll. This report should be used as a tool by the agencies to notify the appropriate employees. A SHARP infolist message will be distributed before June 15, 2010 that will include the name of the new report.
SHARP agencies will need to submit form DA-180 to Payroll Services to initiate the appropriate savings bond balance refund for their employees. Regents’ institutions will need to include the appropriate refund transactions on an off-cycle adjustment file to initiate the refunds for their employees. The savings bonds refunds will need to be completed by the final off-cycle payroll for fiscal year 2010 processing (ie., ‘A’ off-cycle scheduled for Friday, June 18, 2010).
Employees are strongly encouraged to continue to invest in savings bonds and other Treasury securities through TreasuryDirect, a secure web-based system that allows investors to establish accounts to electronically purchase, hold and conduct transactions online for savings bonds and other Treasury securities. To obtain more information or establish a TreasuryDirect account, employees can visit www.treasurydirect.gov.
Once a TreasuryDirect account is established, an employee can continue to experience the convenience of automatic savings by requesting that a portion of their bi-weekly net pay be directed to their TreasuryDirect account by completing a form DA-184, “Authorization For Direct Deposit of Employee Pay,” and submitting it to their agency HR/Payroll office. The form is available on the Accounts and Reports website under Payroll Forms.