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Split Disbursements of Settlements Now Mandatory for Military Travelers

By Sgt. 1st Class Doug Sample
American Forces Press Service

WASHINGTON, Sept. 3, 2003 – A new requirement under the 2003 National Defense Authorization Act has made it mandatory for military government travel card users to use the "split disbursement" option when filing temporary duty travel claims, according to a press release by the Defense Finance and Accounting Office in Indianapolis.

In split disbursement, the government pays the credit card vendor directly when a traveler uses the card and files a voucher for reimbursement, while additional money owed to the traveler goes to the traveler's bank account. Without split disbursement, the traveler receives the entire voucher settlement, and in turn pays the credit card bill.

Until the new policy took effect in April, military people could choose between split disbursement or receiving the entire settlement and paying the credit card bill themselves. Civilian federal workers still have that choice.

Split disbursement is seen as a way to pay the official travel card expenses quickly, and at a cost savings to cardholders, according to information on the DFAS Web site. The option eliminates the need to write out personal checks or pay for stamps to mail payments.

The change also affects partial and accrual payments for long-term temporary travel and local travel, if a government credit card is used.

According to the DFAS release, military travelers must now include all official expenses charged on the credit card in the split disbursement payment block of their travel settlement vouchers. These charges will be paid directly to the vendor currently Bank of America -- by DFAS.

The release states that supervisors, travel approving officials and reviewers must return to military travelers claims that do not accurately reflect charges that are to be paid to the credit card vendor. In addition, a reviewer's signature is required on the travel claim before it is sent to DFAS for payment. The reviewer must also sign off that the split disbursement option is included and the amount of the split disbursement is accurate, the release stated.

The move to make split disbursement mandatory for military traveler may be seen as a way to curb delinquencies in government credit card accounts held by military personnel. According to a General Accounting Office report in October 2002, military government cardholders were responsible for more than $60 million in bad debt charged off by Bank of America earlier that year.

But DFAS spokesman Roger Still states on the Web site that overall the number of DoD credit-card holders with delinquent accounts is a "small percentage" of the total population who have the card. He said in August about 1.7 percent of all DoD cardholders had delinquent accounts.

"So the bottom line is, more than 98 percent of DoD cardholders pay their bills on time, while the commercial sector regularly sees delinquency rates of about 4 percent," he explained.

For more information on the new split disbursement policy, military people should contact their local travel office or go to the DFAS Web site.

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