Payor Agencies

In order to have enough time to send data back and forth with the federal government, a voucher must be matched, budget checked, and approved by 10:00 AM for the possibility of same day processing. If a debt is not found for that vendor in KDRS or TOP, the voucher will be released for PayCyle that same day. If a debt is found in either system, the voucher will be delayed by 2-4 business days. A voucher that becomes eligible for PayCycle after 10:00 AM will not be subject to the new offset process until the following day. Click here for a step by step process involved in the debt collection analysis process. Also, refer to the SMART info blast announcement emailed to agencies on February 19 and March 2, 2015 titled Kansas Treasury Offset Program (KTOP) Impact on SMART Processing. SMART announcements can also be located at: http://www.smartweb.ks.gov/announcements/impt-announce/general-system-news

Only miscellaneous vendor payments will be provided to TOP for matching against federal debts. Payroll, reimbursements processed through the SMART Travel & Expense module, and single payment vouchers without TINs will not be eligible for offset.

When a voucher is entered in SMART, it will begin in a “Not Processed by Collections” status.  The information can be located on the Summary tab of the payment voucher in the Setoff Status field.

At 10 a.m. daily, all payments scheduled to pay that day, aside from a small list of exceptions, are sent to KTOP for analysis to determine if there is a debt match.  At this point, the voucher Setoff Status value will either be set to “Exempt from Collections” or “In Collection Eligiblty Analys.”  This does NOT mean the payment is being offset.

By 2 p.m., any payment without a debt match is released for paycycle and will show a Setoff Status of “No Credit memo created.”  Payments that have a debt match will continue to be in a “In Collection Eligiblty Analys” status until the debt offset occurs.  When that process is complete, the voucher will then have a status of “Collections Complete.”

In addition, a SMART user can also identify if an offset was made by going to the Payments tab on the SMART voucher and looking at the Message field under the Payment Options section.  Federal debts are identified with the following verbiage in the payment Message field of the voucher:  OFFSET PER K.S.A. 75-6201 ET SEQ  QUESTIONS CALL 785-296-4500.

When a State of Kansas payment is intercepted and sent to TOP to be applied to a federal debt, the state agency that made the payment (known as the "payor agency") will receive a notice via email. To view a sample of the notice sent to payor agencies, please click here.

In addition, a notice will be sent to the debtor informing them of the offset and instructing them to give the payor agency full credit for the transaction. The notice sent to the debtor will also provide the debtor with the name and phone number of both the federal creditor agency and the state payor agency. To view a sample of the letter sent to debtors, please click here.

Payor agencies should receive a notice via email when a payment is offset. If the email is not received, the agency should contact KTOP at ktop@ks.gov or (785) 296-4500 and request an update to their accounts payable contact information.

The offset notices that are sent by KTOP are very similar to the setoff notices that are sent by KDRS. The differences between the two notices are listed below:

Offsets occur immediately after a voucher is matched to debt. Reversals are accepted or declined at TOP's discretion, so it is possible that funds may not be recoverable. Therefore, if a payor agency believes that a payment should be exempt from offset, they should contact KTOP prior to entering the voucher into SMART.

The payor agency will need to send documentation supporting the exemption to KTOP for review. If it is determined those types of payments should not be subject to offset, the payor agency will need to provide the funding distribution line(s) specific to the payments. Any voucher entered with the indicated funding distribution line(s) would then be excluded from offset.

Payment auto-release rules that existed in KDRS prior to December 1, 2014 have been loaded into KTOP. Payor agencies that have arranged additional payment exceptions with the Setoff Program on or after December 1, 2014 should notify KTOP immediately.

In an attempt to match federal non-tax payments to debts, the TOP program searches for matches utilizing a debtor's Tax Identification Number (TIN) and name.  If TOP is able to match a payment to the debtor's TIN, but not the name; it results in a 'partial match'.   In this instance, an offset will NOT occur for these debtors.  If this occurs, KTOP will provide the payor agency via email with an attachment listing the partial matches found.  In order for KTOP to ensure that an offset occurs if a future payment is made to that TIN, the agency will need to verify the mismatched payee name from the list that was sent to the agency.  The agency will need to inform KTOP if the alias list on the partial match list should be added to the debtor.

On April 7, 2015, a SMART info blast was emailed to agencies with the subject line of SMART Voucher Setoff Status Field Updated.  The email contained the definition for each SMART collection status transaction indicated on a SMART payment voucher.  The setoff status can be viewed on the voucher Summary tab and on the voucher Payment tab.  The values in SMART are as follows: