AASHTO Journal, 15 January 2016
The Federal Reserve Board said it transferred to the U.S. Treasury $19.3 billion on Dec. 28 to satisfy a funding requirement of the Fixing America’s Surface Transportation Act.
The Fed said that as the FAST Act mandated, that transfer came from its reserve bank capital surplus and was the amount needed to reduce the account’s level to a $10 billion overall capital surplus limitation.
Transferring surplus funds from the Fed was one of the main ways Congress covered the shortfall between spending levels lawmakers authorized for the Highway Trust Fund and the trust fund’s own receipts from dedicated excise taxes on motor fuels and truck equipment.
The Dec. 28 transaction was the first in what will be a series of capital surplus transfers the Fed will need to make over the bill’s five-year life. The legislation also required the Fed to reduce the dividend it pays to many commercial banks for the funds they must hold in reserve with the Fed.
The central bank also said its 12 regional reserve banks made payments to the Treasury of about $97.7 billion from their estimated 2015 net income, which was mainly derived from interest income on securities acquired through open market operations.