[Code of Federal Regulations]
[Title 7, Volume 15]
[Revised as of January 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR3015.102]

[Page 113-114]
 
                          TITLE 7--AGRICULTURE
 
                         CHAPTER XXX--OFFICE OF
                      THE CHIEF FINANCIAL OFFICER,
                        DEPARTMENT OF AGRICULTURE
 
PART 3015_UNIFORM FEDERAL ASSISTANCE REGULATIONS--Table of Contents
 
                     Subpart L_Payment Requirements
 
Sec. 3015.102  Payment methods.

    (a) Non-construction. (1) Letters of credit will be used to pay USDA 
recipients when all the following conditions exist:
    (i) There is or will be a continuing relationship between the 
recipient and the USDA awarding agency for at least a 12 month period 
and the total amount of advances to be received within that period from 
the awarding agency is $120,000 or more per year.
    (ii) The recipient has established or demonstrated to the USDA 
awarding agency the willingness and ability to establish procedures that 
will minimize the time elapsing between the transfer of funds from the 
Treasury and their disbursement by the recipient.
    (iii) The recipient's financial management system meets the 
standards for fund control and accountability prescribed in Subpart H of 
this part.
    (2) Advances by Treasury check will be used, in accordance with 
Treasury Circular No. 1075, when the recipient does not meet the 
requirements in paragraph (a)(1)(i) of this section but does meet the 
requirements in paragraphs (a)(1) (ii) and (iii) of this section.
    (3) Reimbursement by Treasury check shall be the preferred method 
when the recipient does not meet the requirements specified in either 
paragraph (a)(1)(ii) or paragraph (a)(1)(iii) of this section. This 
method may also be used when USDA financial assistance makes up only a 
minor portion of the program and where the major portion of the program 
is accomplished through private financing or Federal loans.
    (b) Construction. (1) Reimbursement by Treasury check shall be the 
preferred method when the recipient does not meet the requirements 
specified in Sec. 3015.102(a)(1) (ii) or (iii), and may be used for any 
USDA construction grant unless USDA has entered into an agreement with 
the recipient to use a letter of credit for all USDA grants, including 
construction grants.

[[Page 114]]

    (2) When the reimbursement by Treasury check method is not used, 
Sec. 3015.102(a) (1) and (2) shall apply to the construction grants. 
Implementing procedures under Sec. 3015.102(a) (1) and (2) will be the 
same for construction grants as for nonconstruction grants awarded to 
the same recipient, insofar as possible.
    (3) USDA awarding agencies will not use the percentage-of-completion 
method to pay its construction grants. The recipient may use that method 
to pay its construction contractor, but if it does, USDA payments to the 
recipient will nevertheless be based on the recipient's actual rate of 
disbursements.