Federal employees are getting a financial safety net next month for their flexible spending reimbursements.

FSAFEDS program members can take out no-interest loans from the Federal Employee Education and Assistance Fund during a claims reimbursement blackout period.

FEEA Executive Director Steven Bauer said in a statement that the loans are for “federal families who are stretched to the limit.”

“The FSA blackout for more than a month is more than an inconvenience for many federal employees, especially for those with children in daycare,” Bauer said. “In some cases this loss of cash flow will mean choosing between keeping the lights on, paying their mortgage or even putting food on the table for their family in order to keep their child safe while they work for Uncle Sam.”

National Treasury Employees UnionNational President Tony Reardon said in a statement that FEEA responded immediately with help when asked about providing loans for the reimbursements.

“Many NTEU members have recurring costs, such as child care, and rely on the FSAFEDS reimbursement to meet their financial obligations in a timely manner,” Reardon said in his letter to FEEA. “It will unquestionably create a substantial hardship on employees using FSAs for recurring dependent care payments who will face not being reimbursed for multiple weeks.”

The pause in claims is the result of a vendor changeover. WageWorks is replacing ADP, which ran the program since April 2003.

Reardon said the union asked OPM to shorten the blackout period. The blackout begins July 30 and ends Sept. 1.

Chat with Jonathan Alboum, USDA CIO, July 26 at 2 p.m. Sign up here.

“I understand that program transitions may be necessary and take time to implement but many federal workers — particularly those serving in lower graded positions — simply cannot wait an extra month to be reimbursed,” Reardon said in his June 8 letter to the Office of Personnel Management.

OPM said federal employees can submit claims via fax or online by 4 p.m., Eastern Time on Friday, July 29, or by mail no later than July 20 to ensure processing before the blackout period. Processing of claims is expected to resume on Sept. 8.

Employees can access the application for the loan the FEEA website.

OPM’s inspector general last year voiced “serious concerns” over the agency’s outdated procurement process, highlighting that the FSAFEDS Federal Acquisition Regulation (FAR) contract did not have a single re-competition in the past seven years.

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