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CHILD SUPPORT ENFORCEMENT

Y 4. W 36: 103-30

Cliild Support Enforcenent/ Serial H. . .

HEARING

BEFORE THE

SUBCOMMITTEE ON HUMAN RESOURCES

OF THE

COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES

ONE HUNDRED THIRD CONGRESS
FIRST SESSION

JUNE 10, 1993

Serial 103-30

Printed for the use of the Committee on Ways and Means

^ t993

U.S. GOVERNMENT PRINTING OFFICE ^^CATT

72-449 CC WASHINGTON : 1993

For sale by the L'.S. Govcmmeni Printing Office
Superintendent of Documents. Congressional Sales Office. Washington. DC 20402
ISBN 0-16-041620-5

CHILD SUPPORT ENFORCEMENT

Y 4. W 36: 103-30

Child Support Eoforccnent/ Serial K. . .

HEAKING

BEFORE THE

SUBCOMMITTEE ON HUMAN RESOURCES

OF THE

COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES

ONE HUNDRED THIRD CONGRESS
FIRST SESSION

JUNE 10, 1993

Serial 103-30

Printed for the use of the Committee on Ways and Means

U.S. GOVERNMENT PRINTING OFFICE ^HChfJ

72-449 CC WASHINGTON : 1993

For sale by the L .S. Government Printing Office
Superintendent of Docunients. Congressional Sales OtTice. Washington. DC 2()4{)2
ISBN 0-16-041620-5

COMMITTEE ON WAYS AND MEANS
DAN ROSTENKOWSKI, Illinois, Chairman

SAM M. GIBBONS, Florida
J.J. PICKLE, Texas
CHARLES B. RANGEL, New York
FORTNEY PETE STARK, California
ANDY JACOBS, JR., Indiana
HAROLD E. FORD, Tennessee
ROBERT T. MATSUI, California
BARBARA B. KENNELLY, Connecticut
WILLIAM J. COYNE, Pennsylvania
MICHAEL A. ANDREWS, Texas
SANDER M. LEVIN, Michigan
BENJAMIN L. CARDIN, Maryland
JIM MCDERMOTT, Washington
GERALD D. KLECZKA, Wisconsin
JOHN LEWIS, Georgia
L.F. PAYNE, Virginia
RICHARD E. NEAL, Massachusetts
PETER HOAGLAND, Nebraska
MICHAEL R. McNULTY, New York
MIKE KOPETSKI, Oregon
WILLIAM J. JEFFERSON, Louisiana
BILL K. BREWSTER, Oklahoma
MEL REYNOLDS, Illinois

BILL ARCHER, Texas
PHILIP M. CRANE, Illinois
BILL THOMAS, California
E. CLAY SHAW, Jr., Florida
DON SUNDQUIST, Tennessee
NANCY L. JOHNSON, Connecticut
JIM BUNNING, Kentucky
FRED GRANDY, Iowa
AMO HOUGHTON, New York
WALLY HERGER, California
JIM McCRERY, Louisiana
MEL HANCOCK, Missouri
RICK SANTORUM, Pennsylvania
DAVE CAMP, Michigan

Janice Mays, Chief Counsel and Staff Director
Charles M. Brain, Assistant Staff Director
Phillip D. MOSELEY, Minority Chief of staff

Subcommittee on Human Resources

HAROLD E. FORD, Tennessee, Chairman

ROBERT T. MATSUI, California
JIM MCDERMOTT, Washington
SANDER M. LEVIN, Michigan
MIKE KOPETSKI, Oregon
MEL REYNOLDS, Illinois
BENJAMIN L. CARDIN, Maryland

RICK SANTORUM, Pennsylvania
E. CLAY SHAW, Jr., Florida
FRED GRANDY, Iowa
DAVE CAMP, Michigan

(II)

CONTENTS

Page

Press release of Thursday, May 27, 1993, announcing the hearing 2

WITNESSES

U.S. Department of Health and Human Services, Hon. David T. Ellwood,

Ph.D., Assistant Secretary for Planning and Evaluation 35

American Bar Association, Marshall J. Wolf 98

American Public Welfare Association, Larry D. Jackson 91

American Society for Payroll Management, Robert D. Williamson 143

Association for Children for Enforcement of Support, Inc., Geraldine Jensen ... 158

Center for Law and Social Policy, Paula Roberts 176

Child Support Council, Darryll W. Grubbs 67

Children s Defense Fund, Nancy Ebb 149

Children's Rights Council, David L. Levy 169

Haynes, Margaret Campbell, former chair, U.S. Commission on Interstate

Child Support 113

Kennelly, Hon. Barbara B., a Representative in Congress from the State

of Connecticut 11

Massachusetts Department of Revenue, Robert M. Melia 132

National Child Support Enforcement Association, Michael R. Henry 80

New York City, Michael Infranco 126

Schroeder, Hon. Patricia, a Representative in Congress from the State of

Colorado 22

SUBMISSIONS FOR THE RECORD

Ayuda, Clinica Legal Latina; Center for Law and Social Policy; Children's
Defense Fund; National Women's Law Center; United States Catholic Con-
ference; and Women's Legal Defense Fund, joint statement 184

Bradley, Hon. Bill, a U.S. Senator from the State of New Jersey, statement .... 7
Castellano, June, Greater Upstate Law Project, Rochester, N.Y., statement .... 221
Center for Law and Social Policy (See listing for Ayuda, Clinica Legal Latina)
Children's Defense Fund (See listing for Ayuda, Clinica Legal Latina)
Cole, Hugh, Eastern Regional Interstate Child Support Association, state-
ment 206

Community Service Society of New York, Linda R. Wolf Jones, statement 195

Conference of State Court Administrators, Howard P. Schwartz, statement .... 203
Eastern Regional Interstate Child Support Association, Hugh Cole, state-
ment 206

Gay, Roger F., South Bend, Ind., statement 211

Ghosh, Subhen, Hutsonville, 111., letter 219

Greater Upstate Law Project, Rochester, N.Y., June Castellano, statement 221

Illinois Task Force on Child Support, Marion Wanless, letter 224

Jones, Linda R. Wolf, Community Service Society of New York, statement 196

Keenan, Joan S., New York State Department of Social Services, statement ... 243

National Society of Professional Engineers, statement 227

National Women's Law Center (See listing for Ayuda, Clinica Legal latina)

New Jersey Council for Children's Rights, statement and attachments 229

New York State Department of Social Services, Joan S. Keenan, statement .... 243

Schwartz, Howard P., Conference of State Court Administrators, statement ... 203

State Communities Aid Association, Albany, N.Y., Russell Sykes, statement ... 248

(III)

Page

United States Catholic Conference (See listing for Ayuda, Clinica Legal
Latina)

Wanless, Marion, Illinois Task Force on Child Support, letter 224

Women's Legal Defense Fund (See listing for Ayuda, Clinica Legal Latina)

CHILD SUPPORT ENFORCEMENT

THURSDAY, JU>fE 10, 1993

House of Representativt:s,
CoMMin^EE ON Ways and Means,
Subcommittee on Human Resources,

Washington, D.C.
The subcommittee met, pursuant to call, at 10 a.m., in room
B-318, Rayburn House Office Building, Hon. Harold E. Ford (chair-
man of the subcommittee) presiding.

[The press release announcing the hearing follows:!

(1)

FOR IMMEDIATE RELEASE PRESS RELEASE #5

THURSDAY, MAY 27, 1993 SUBCOMMITTEE ON HXniAM RESOURCES

COMMITTEE ON WAYS AND MEANS
U.S. HOUSE OF REPRESENTATIVES
1102 LONQWORTH HOUSE OFFICE BLOO.
WASHINGTON, D.C. 20515
TELEPHONE: (202) 225-1721

THE HONORABLE HAROLD E. FORD (D. , TENN. ) , CHAIRMAN,
SUBCOMMITTEE ON HUMAN RESOURCES, COMMITTEE ON WAYS AND MEANS,
U.S. HOUSE OF REPRESENTATIVES,
ANNOUNCES AN OVERSIGHT BEARING ON CHILD SUPPORT ENFORCEMENT

The Honorable Harold E. Ford (D. , Tenn.)/ Chairman,
Subcommittee on Human Resources, Committee on Ways and Means, U.S.
House of Representatives, today announced that the Subcommittee
will hold an oversight hearing on child support enforcement. The
hearing will be held on Thursday, June 10, 1993, beginning at
10:00 a.m. in room B-318 of the Rayburn House Office Building.

BACKGROUND

The child support enforcement program was enacted as Part D of
Title IV of the Social Security Act in 1975 (P.L. 93-647). The
States operate their own programs within Federal law and
regulations and the Federal Government pays for 66 percent of the
administrative costs. States are responsible for establishing
paternity, locating absent parents, establishing child support
orders, and enforcing child support. The Federal role includes
monitoring and evaluating State programs, providing technical
assistance, and in certain instances, helping States locate absent
parents and collect child support payments.

The most recent attempt by Congress to reform the child
support enforcement program was enacted under the Family Support
Act of 1988. Some main elements were: (1) requiring State and
local officials to use the child support guidelines established
under the 1984 amendments; (2) requiring all parties to take
genetic tests in a contested paternity case if requested by one of
the parties and providing 90-percent Federal matching for the cost
of paternity tests; (3) requiring States to implement automated
tracking and monitoring systems by October 1995, with 90-percent
Federal matching; and (4) requiring States to implement wage
withholding against non-custodial parents under certain
circumstances. By the beginning of fiscal year 1996, all of these
changes will have gone into effect.

SCOPE OF THE HEARING

Members of the Subcommittee are interested in hearing
testimony on the status of State child support enforcement
programs, especially in relation to the implementation of the

In addition, Members are interested in various proposals for
reform of the child support enforcement system, such as: the
recommendations of the Interstate Commission on Child Support; the
Child Support Enforcement and Assurance Proposal; and the proposals
of the Clinton Administration described in A Vision of Change for
America.

DETAILS FOR SUBMISSION OF REQUESTS TO BE HEARD!

Individuals and organizations interested in presenting oral
testimony before the Subcommittee must submit their requests by
telephone to Harriett Lawler, Diane Kirkland, or Karen Ponzurick
[(202) 225-1721] no later than close of business, Thursday,
June 3, 1993, to be followed by a formal written request to
Janice Mays, Chief Counsel and Staff Director, Committee on Ways
and Means, U.S. House of Representatives, 1102 Longworth House

Office Building, Washington, D.c. 20515. The Subcommittee staff
will notify by telephone those scheduled to appear as soon as
possible after the filing deadline. Any questions concerning a
scheduled appearance should be directed to the Subcommittee staff
[(202) 225-1025].

It is urged that persons and organizations having a common
position make every effort to designate one spokesperson to
represent them in order for the Subcommittee to hear as many points
of view as possible. Time for oral presentations will be strictly
limited with the understanding that a more detailed statement may
be included in the printed record of the hearing. (8«« formatting
requirements below.) This process will afford more time for
Members to question witnesses. In addition, witnesses may be
grouped as panelists with strict time limitations for each
panelist.

In order to assure the most productive use of the limited
amount of time available to question witnesses, all witnesses
scheduled to appear are required to submit 200 copies of their
prepared statements to the Subcommittee office, B-317 Rayburn House
Office Building, at least 24 hours in advance of their scheduled
appearance. Failure to comply with this requirement may result in
the witness being denied the opportunity to testify in person.

WRITTEM STATEMENTS IN LIED OF PER80HAL APPEARAMCB;

Any persons or organizations wishing to submit a written
statement for the printed record of the hearing should submit at
least six (6) copies of their statements by close of business,
Thursday, June 24, 1993, to Janice Mays, Chief Counsel and Staff
Director, Committee on Ways and Means, U.S. House of
Representatives, 1102 Longworth House Office Building, Washington,
D.C. 20515. If those filing written statements wish to have their
statements distributed to the press and interested public, they may
deliver 100 additional copies for this purpose to the Subcommittee
office, room B-317 Rayburn House Office Building, on or before the
day of the hearing.

FORMATTINQ REQOIREMENTS :

Each sUUinent presented for printinf to the Committee by a witness, any written statement or
exhibit submitted for the printed record or any written comments in response to a request for written
comments must conform to the (uidelines listed below. Any statement or exhibit not in compliance with
these guidelines will not be printed, but will be maintained in the Committee files for review and use by the
Committee.

1. All statements and any accompanying exhibits for printing must be typed in single space
on legal-size paper and may not exceed a total of 10 pages.

2. Copies of whole documents submitted as exhibit material will not be accepted for printing.
Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit
rrjterisl fot meeting these ipecif'^atio.'ii v/il! ba maintained in the Committee file." foi
review and use by the Committee.

3. Statements must contain the name and capacity in which the witness will appear or, for
written comments, the name and capacity of the person submitting the statement, as well
as any clients or persons, or any organization for whom the witness appears or for whom
the statement is submitted.

4. A supplemental sheet must accompany each statement listing the name, full address, a
telephone number where the witness or the designated representative may be reached and
a topical outline or summary of the comments and recommendations in the full statement.
This supplemental sheet will not be included in the printed record.

The above restrictions and limitations apply only to material being submitted for printing.
Statements and exhibits or supplementary material submitted solely for distribution to the Members, the
press and the public during the course of a public hearing may be submitted in other forms.

Chairman Ford. The Subcommittee on Human Resources will
come to order.

We are very delighted to have a panel of witnesses to testify
today before the subcommittee. Six years ago, as chairman of the
Subcommittee on Human Resources, I introduced the Family Wel-
fare Reform Act of 1987. In less than 2 years, the bill evolved into
the Family Support Act of 1988. This act emphasized many of the
same themes President Clinton stresses today: reducing poverty,
keeping families together, promoting parental responsibility and
self-sufficiency, providing education, training and work incentives,
assisting with day care and transportation, and enforcing child
support obligations.

Today the subcommittee holds an oversight hearing on the child
support enforcement program. Since 1988, program collections have
grown by 45 percent. Paternities established have risen by 67 per-
cent, and the number of parents located has tripled, but many
problems still remain with the system.

This hearing will address these problems. They include problems
with implementation of the Family Support Act, the various issues
addressed by the Interstate Commission on Child Support, the pro-
posals of the Clinton administration, child support assurance, and
other proposals made by Members of Congress, interest groups,
and citizens affected by this system.

I am pleased and encouraged by the response to the subcommit-
tee's call for public witnesses on this vital subject. It is clear that
the intent of this subcommittee, as well as the full committee, is
to move in this area after hearing from the administration, hearing
from colleagues in the Congress, and other experts and witnesses
throughout this country. This legislation will probably coincide
with welfare reform as we tackle these two major issues.

I am very delighted to join with my colleagues on the minority
side as well as my colleagues on the majority side to work with
them tirelessly to bring about needed changes, and to revamp child
support enforcement if necessary.

I am also delighted to have testifying today one of our colleagues
and a former member of this subcommittee, Ms. Kennelly, who has
offered her leadership and has been a giant among giants in this
area. I had the opportunity to work with her on the last child sup-
port enforcement legislation on this subcommittee.

And I want to you know, Ms. Kennelly, you were a true leader
in this area, and I certainly look forward to working with you and
seek your participation at every level as we move tnis legislation.

Before I recognize you, I would like to see if Mr. Grandy would
have any opening statements from the minoritv side.

Mr. Grandy. Thank you, Mr. Chairman, I do. And let me say at
the outset that our ranking member, Mr. Santorum, is unavoidably
delayed, and I am speaking on behalf of him and the rest of the
minority members. I want to begin by thanking you, Mr. Chair-
man, for beginning this process which I hope will be ongoing and
productive, and I assume it will.

I particularly want to welcome, as you did Ms. Kennelly, who of
course was a former member of this committee and a member of
the interstate commission and someone we have relied on, as well
as Dr. EUwood, who is now a member of the administration, but

prior to his service with the Chnton administration was a valuable
resource to this committee involving issues such as time limitation
of benefits, child support assurance and a variety of welfare reform
initiatives in between.

I do want to make a couple of points about the procedure that
we are about to undertake to consider legislation on child support
enforcement and/or welfare reform.

Republicans probably within the next couple of weeks will be in-
troducing a child support enforcement bill that we intend to use as
a companion piece to our welfare reform initiative that we intro-
duced at the beginning of this year, because we, like you, believe
that the two issues are tied together.

But having said that, I think it would be a shame if child sup-
port enforcement legislation got tied into a welfare reform package
which might be much more controversial and thereby delayed.

I think it is possible to move forward on a bipartisan effort on
child support that might be able to be finished this year. The sig-
nals we are hearing from the administration are that welfare re-
form might be delayed until next year. I think that is a shame in
itself, but I hope if that is true we will be able to move forward
with some kind of bipartisan child support legislation.

The other point I want to make is that I hope also that we do
not come to blows over the concept of child support assurance. This
is a concept that I want to stress. Mr. Shaw, Ms. Johnson, and I
introduced as a demonstration project last year and we have
reincorporated it as a demonstration project into our welfare re-
form package. We support trying this innovative idea at a State
level.

But I think at this point we would be reluctant and would prob-
ably oppose a Federal initiative toward taking child support assur-
ance and shoehorning it into a welfare reform bill without any kind
of test. I hope we would not be forced to divide over this issue, be-
cause we are supportive of the concept but want to try to before
we pay for it at the level that, of course, a Federal initiative would
require.

The last thing I want to say, Mr. Chairman, and I suppose I will
take every opportunity to do that, with Dr. Ellwood here, I would
plead to you individually and personally that you would begin to
open a dialog with this side of the aisle with Republicans on wel-
fare reform.

We are ready to go. We have got a bill. I think it is in keeping
very much with what the President campaigned on and what he
has said since he has become the President of the United States.
And I think if there is one area where Republicans and Democrats
agree, it will be on this whole initiative of making work pay and
tying a benefit to some kind of responsibility in the workplace.

And I hope that we will begin to get some feedback from the ad-
ministration, because quite honestly the silence has been somewhat
deafening and discouraging. Just because we don't agree on the
budget initiative and we have not been able to come to terms on
taxes does not mean Republicans are digging in and just looking
for ways to become obstructionist for this entire administration.
Quite the contrary.

And I hope you particularly, Dr. Ellwood, will begin to open some
kind of channel of communication with us, because we are very in-
terested in getting this done. I think it can be done this year. I
think this is one area where we can work together.

Having said that, Mr. Chairman, I want to thank you for begin-
ning these discussions, and I welcome our colleague, Mrs. Kennelly,
and Dr. Ellwood.

Chairman Ford. Thank you.

We will, from this side of the aisle, look with anticipation to
working with the minority side. It certainly will be the intent of
this subcommittee to try to move both welfare reform as well as
child support enforcement. Whether they will move simultaneously,
we don't know. But we certainly would look forward to working
with the Republicans on the committee, and maybe reporting a bi-
partisan bill.

It was certainly the intent of this subcommittee in 1988 to sup-
port a bipartisan bill, and I must say that we certainly had mem-
bers of your party who worked very closely with us to report legis-
lation. I don't think we received the votes on the final passage. I
hope that will not be the case in 1993 or whenever the bill is re-
ported.

I, as chairman of this subcommittee, strongly look forward to
working with you and others to make sure we can put the compo-
nents together to report a welfare reform package as well as child
support enforcement legislation.

At this time, if no other committee members have an opening
statement, I am going to recognize Ms. Kennelly for her testimony.

Before you begin, I am going to say that without objection, I am
going to ask that the written testimony of Senator Bill Bradlev be
made a part of the record. He is not going to be able to testity in
person this morning.

[The prepared statement of Senator Bradley follows:]

iu^ l\uUA^

TESTIMONY OF SENATOR BILL BRADLEY

BEFORE THE U.S. HOUSE OF REPRESENTATIVES

COMMITTEE ON WAYS AND MEANS

HUMAN RESOURCES SUBCOMMITTEE

ON CHILD SUPPORT ENFORCEMENT

JUNE 10, 1993

MR. CHAIRMAN, thank you for the opportunity to testify this
morning regarding reform proposals that have been made by the U.S.
Commission on Interstate Child Support. I am especially honored to
be able to testify here with my colleague on the Commission,
Barbara Kennelly, a legislator who has done so much in this area.
I very appreciate having worked with her and Representative Marge
Roukema on this issue.

This is not the first time that we have attempted to tackle
the problems of child support enforcement. In 1984, we mandated
several reforms, including wage withholding if an absent parent is
one month in arrears on his child support, state child support
guidelines, and the establishment of federal and state income tax
refund offsets to collect overdue support. In the Family Support
Act, we expanded the use of genetic testing in contested paternity
cases, increased the use of wage withholding, and made a number of
other badly needed reforms. These changes have produced positive
results. Total child support collections, which amounted to $2
billion in 1983, were up to $4 billion by 1988 and up to $6
billion in 1990. Paternity establishment increased 60 percent from
1986 to 1990.

Yet, even with these improvements, no one would suggest that
we have solved all the problems, especially in interstate cases.
That is why I worked to include legislation creating the U.S.
Commission on Interstate Child Support in the Family Support Act.
Since the Commission issued its final report to Congress last
year, I have included a number of its recommendations in a
comprehensive reform bill, S. 689, which I believe could
significantly improve interstate enforcement. On the same day I
introduced my bill. Representative Roukema introduced a companion
measure, H.R. 1600, here in the House, showing that support for
the Commission's recommendations cuts across party lines. I know
that my colleague on the Commission, Representative Kennelly, has
introduced a bill, H.R. 1961, which is also largely based on the
Commission's report.

Our current system of interstate child support sends people
who do not want to pay their child support the following message:
If you want to avoid paying the money you owe your kids, just
cross state lines. Just cross the state line and forget your
responsibility to your kids! It is unconscionable that in a modern
society, where people cross state lines every day, crossing a
state line to live in a state different from the state where your
kids reside can substantially reduce your chances of being caught
for not paying child support.

Nationally, one out of every three child support cases is an
interstate case, yet only $1 out of every $10 collected is from an
interstate case. Behind this statistic are millions of families
who are drowning in red tape trying to collect their child
support.

Listen, Mr. Chairman, to some common problems that occur in
interstate cases. Under current practice, if a custodial parent
has a child support order (and only 60 percent do), she or he has
to enforce that order in the state where the absent parent
resides. This usually requires that the custodial parent file an
action under the Uniform Reciprocal Enforcement of Support Act
{"URESA"), an outdated and complicated law which allows
non-uniform state laws and procedures to delay enforcement and
collection in interstate cases.

Despite federal laws to the contrary, judges often allow for
the reduction of fully valid child support orders from other
states. Other problems, like staffing restrictions (the average
case load per child support case worker is 1,000 cases per
caseworker) and the lack of locate resources, add to the problem
of enforcement across state lines.

If the custodial parent does not have a child support order,
she or he must go to the state where the absent parent resides,
find the absent parent, establish an order, and enforce that order
against the delinquent parent. If the custodial parent has not
established paternity, she must do so before establishing a
support order. Finding the absent parent and his or her assets is
a difficult and frustrating process. When absent parents are
discovered at a particular job, they often quit. When their
addresses are found, they often move. Because we have not put the
proper resources toward locating absent parents, custodial parents
are often one step behind them, frustrating their ability to
receive child support.

I believe we must take a stand on this issue. We must send a
clear message that the failure of many parents to take
responsibility for their children is a national disgrace! We do
not do a very good job now. For example, in many states it is now
easier for a person's failure to pay his car note to appear on his
credit report than it is for his failure to pay child support to
appear. And delinquent parents come in all genders, races, and
economic classes.

The bill I have introduced makes several changes to the
current system. It promotes uniformity in the laws and practices
of the states, encourages voluntary and quick paternity
establishment, and enhances the capacity of the states to locate
people who do not pay. The bill also takes tough enforcement
measures against those who do not pay. Mr. Chairman, we are now
sending the wrong message to delinquent parents. This bill sends
the message, "we will find you and make you pay."

My bill requires all states to pass in substantially the same
form the Uniform Interstate Family Support Act ("UIFSA"), a
simpler, more expansive model act for interstate enforcement than
the current law. It also requires the states to remove many of the
legal barriers associated with interstate enforcement.

My bill requires the states to set up quick and accurate
methods for determining paternity, and requires all states to have
voluntary hospital-based paternity acknowledgement programs. I am
pleased that the Ways and Means Committee passed a version of the
bill's paternity establishment provisions in its Budget
Reconciliation legislation. About eighty-five percent of all
fathers are at the hospital or in contact with their kids during
the first few days of their birth. Why not give them the
opportunity to acknowledge paternity at that time? Voluntary
paternity acknowledgement programs are working effectively in the
states of Washington and Virginia, and should be expanded to every
state in the country.

My bill establishes a system to better track those who owe
child support when they start a new job. Under the current system,
many absent parents leave their jobs before custodial parents can
locate them. My bill requires employers to report all new hires
within ten days to the child support agency in their state. Most
of the reporting would be done by sending a copy of a new hire's
W-4 form to the state child support agency. The state child
support agency would then be required to compare the new hire
information with information in its registry of child support
orders to determine whether the new hire owes child support in the
state. The state child support agency would also be required to
broadcast the new hire information to other states over a national
network so that those states could match the information with
information they have in their registries. When fully operational,
I expect this provision to save the federal government millions of
dollars in welfare payments. Fourteen states currently operate
some version of this reporting program, and I expect more to begin
operating such a scheme in the future. We should borrow from
successful state programs in forging a national reporting scheme.

Even with these changes, some parents still will pay child
support. That is why I have included in my bill several strong
enforcement provisions which should help force people to pay or at
least negotiate the terms of payment with the proper authorities.
If they ignore orders to appear at child support hearings, my bill
makes it possible for delinquent parents to loose their driver's
licenses and occupational licenses, hitting them in a sense where
they feel it the most. Punitive measures such as these have been
successful at getting those who are not identified through wage
withholding to pay the money they owe their children.

My bill also requires the Office of Child Support Enforcement
to conduct staffing studies of each state's child support program
and report its findings to the states and Congress. I am certain
that this information could be helpful in deciding the proper

number of staff necessary to effectively enforce child support.
The bill also mandates training of child support staff to ensure
that the people hired at the state level are equipped to do the
job.

Mr. Chairman, by encouraging passage of tough child support
legislation I do not want to suggest that there are not situations
where absent parents simply cannot legitimately pay their child
support. Obviously, courts and administrative agencies should be
sensitive to changes in the economic circumstances of those who
owe child support. In addition to tough enforcement, we must also
be committed to programs which employ disadvantaged, absent
parents. That is why I have included in a bill that I have
recently introduced, the Neighborhood Reconstruction Corps Act, a
provision giving people who owe child support a preference for
jobs created by that program.

I recently met with a group of disadvantaged fathers in New
Jersey who were identified by the state child support agency for
not paying child support. They were participating in a job
training and parenting course that I worked to fund as a
demonstration program. In addition to providing basic skills
training to these men, the program also put them back into contact
with their children. Several of the men told me that they had not
been in contact with their kids for many years until they were
identified by the program. My conversation with these men
convinced me that more is at stake here than just money. It is
true that increasing child support payments will have a
significant impact on family income and raise many children out of
poverty. But it is also true that there are intangible benefits
that flow from contact between a child and both his or her
parents. I like to keep these issues in mind when thinking about
child support.

Time does not allow me to discuss in detail all the
provisions of my bill, but with your permission I would like to
enter a detailed summary of it into the record. It is clear that
something must be done to improve the system of child support
enforcement in this country. The Commission has come up with a
number of very workable reforms. I urge you to listen closely to
what my colleagues on the Commission, Barbara Kennelly and Meg
Haynes, have to suggest. I think you will find their suggestions
timely, enlightening, and extremely practical.

Chairman Ford. Ms. Kennelly.

STATEMENT OF HON. BARBARA B. KENNELLY, A REPRESENTA-
TIVE IN CONGRESS FROM THE STATE OF CONNECTICUT

Mrs. Kennelly. Thank you, Mr. Chairman. I certainly appre-
ciate the opportunity to testify before you, and may I say I miss
being on this subcommittee far more than I anticipated. I am com-
ing here today to talk about child support enforcement, knowing
that many members of the subcommittee know so much about
these problems that we are dealing with.

Sadly, too many children today lack something that all of us took
for granted, and that is strong support from our parents. More and
more children, as we know, are growing up in poverty, and the rea-
son for that is that many of them are in single-parent families. In
fact, we know that children in single-parent families unfortunately
are six times more likely to grow up in poverty.

Finding solutions to child support enforcement has been a con-
cern of mine since I came to Congress, and immediately became
very involved in the 1984 child support enforcement amendments.

Mr. Chairman, one of my fondest memories and one of the better
things that happened to me was working with you on the 1988 leg-
islation. These laws, as you know, ensure that we have mandatory
wage withholding, incentive payments to States and other improve-
ments in the child support enforcement programs so that all chil-
dren receive enforcement assurances regardless of their cir-
cumstances.

I also had the opportunity to be appointed by the Speaker of the
House as a Commissioner on the U.S. Commission on Interstate
Child Support. Senator Bradley and I served on that Commission
with Congresswoman Marge Roukema. The Commission grappled
with the specific problems we are facing. We had many, many
meetings and deep research. The report has innovative rec-
ommendations that go a long way toward addressing many of the
problems we face in securing enforcement of payments for children
in need.

Today, Mr. Chairman, we have a great opportunity to build on
the legislative gains we have made from 1984 to 1988 and the rec-
ommendations of the Interstate Commission. That is why I have
introduced H.R. 1961, the Interstate Child Support Act of 1993.
This bill implements a vast majority of the recommendations
brought forth by the Interstate Commission. This legislation can
make and continue to make, as past legislation has made, a dif-
ference in improving children's lives.

There are those who believe that the problems of the child sup-
port system are so big that they are beyond repair, and that we
should have the Federal Government take over this whole system.
I believe that federalizing the child support program by transfer-
ring the program responsibilities from the States to tne Federal
Government to the Social Security Administration or to the Inter-
nal Revenue Service is not yet the answer for stronger improved
child support enforcement.

I say "not yet," at least not at this time, because I think there
are many aspects of State programs that work. I believe that we
must build on what works, and correct what doesn't. I believe that

the current Federal-State program can work with more oversight
and stronger legislative authority.

Having said that, and having been involved in this question as
you and other members of the panel have, I really feel that we
have a new opportunity. We have a new administration with a
stated commitment to child support enforcement improvements in
this country. We have Mr. Ford, with your history of commitment,
as the chairman. I am committed to do something in this area, and
hearing Mr. Grandy's statements I know this can be a bipartisan
effort. Senator Bradley, too, is committed to this effort. The Inter-
state Commission did such deep and intense work. We know inter-
state enforcement is one of the greatest problems. When the parent
who is not supporting moves to another State, the difficulties in-
volved in collecting are great. I would have to tell you. Chairman
Ford, that if this next effort does not result in child support en-
forcement being improved for the children of America, then I might
have to be one of those who says, "maybe we have to go to a Fed-
eral system."

But I would say to you this morning, I think we should give it
one last good effort to make the system as it is today better, and
result in children getting child support.

May I just mention a few things that I do think have to be looked
at. These are strengthening both the State and Federal programs
individually, expanding computerized systems, and strengthening
enforcement mechanisms across the board. We know what the bar-
riers are; we have to get over the barriers. We have to establish
and clarify State jurisdiction, and we have to implement the one-
to-one State order. We have to establish voluntary, civil paternity,
and we have to have consent programs concerning paternity that
we know work.

We have to authorize demonstration programs for assurance sys-
tems, for revising Federal payment formulas to States, and for the
development of support order establishment outreach programs.
We have to study the feasibility of an employment program for
noncustodial parents.

I would like to mention one aspect of this problem that I know
is of great concern to many people, and that is deadbeat dads. The
intent of my legislation is to help children and families, not to pun-
ish individuals. There are two types of people who fail to pay child
support: Those who avoid payment because they do not want to
pay, and those who want to contribute but do not have the means
to pay.

From my experience in child support legislation, I also know
there is a real problem involved when mothers do not want the fa-
ther to see the child, and use that somewhat as a stick, making the
whole situation so unhappy and so difficult.

I would like to say today that I understand that, but visitation
and child support are two different issues. Mr. Chairman, you and
I both know we have to address both issues. But I don't want to
take away from what we are addressing today by just calling it
deadbeat dads, as if that were the whole situation.

There are those who want to pay and those who don't want to
pay. That is why this legislation includes a provision that recog-
nizes the need for employment assistance, which is intended to

build upon the demonstration programs of the parents' fair share
demonstration programs which developed as a result of the Family
Support Act.

I am going to insert the rest of my testimony. But as I look at
you and your committee members, I see individuals who clearly un-
derstand what we are trying to do. I think we can get over the bar-
riers of not having child support for American children if we work
together on getting new legislation to improve on what is on the
books.

And I thank you so much, sir, for allowing me to be involved in
this effort. Thank you, Mr. Chairman.

[The prepared statement follows:]

The Honorable Barbara B. Kennelly
Testimony before the Subcommittee on Human Resources
June 10, 1993

Mr. Chairman: Let me start by thanking you for allowing me the
opportunity to testify today, as well as for holding this hearing to
highlight the importance of child support enforcement.

Certainly the members of this subcommittee know the problems we
are dealing with. The sad reality is that children are lacking
something many of us took for granted when we were children -- strong
support from their parents. More and more children are growing up in
single parent homes, a situation which subjects far too many children
to poverty. In fact, children in single parent homes are 6 times as
likely to be poor and to stay poor than children in two parent
families .

Finding solutions to child support enforcement problems has been
a primary concern of mine since I came to Congress in 1982.
Legislation that I introduced and fought for in 1984, and the Family
Support Act which I strongly supported in 1988 helped to strengthen
child support enforcement procedures. These laws ensure, through
mandatory wage withholding, incentive payments to states, and other
improvements in the child support enforcement program, that all
children receive enforcement assurance regardless of their
circumstances .

I also recently served as a Commissioner on the United States
Commission on Interstate Child Support to address the specific
problems of interstate cases. Issued in August 1992, the Commission's
report contains innovative recommendations which can go a long way
towards addressing many of the current challenges we face in securing
child support payments for children in need.

Today, we have a great opportunity to build on the legislative
gains we made in 1984 and 1988, and the recommendations of the
Commission. That is why I have introduced legislation, H.R. 1961, The
Interstate Child Support Act of 1993. My bill implements a vast
majority of the recommendations of the Committee report, and some
additional provisions. This legislation can make a real difference in
improving children's lives.

There are some who believe that the problems in the child support
system are so big that they are beyond repair; that we should have the
federal government take over the system. I believe that federalizing
the child support program by transferring the program responsibilities
from the states to the federal government, to the Social Security
Administration and/or the Internal Revenue Service, is not the answer
for a stronger and improved child support enforcement program -- at
least at this time. There are many aspects of state programs that
work, and I believe that we must build on what works, and correct what
doesn't. I believe that the current federal-state program can work
with more oversight and stronger legislative authorities.

In general terms, my legislation calls for--

o Strengthening both the state and federal programs;

o Expanding computerized locate systems;

o Strengthening enforcement mechanisms;

o Establishing and clarifying state jurisdiction, and
implementing the "one state-one order" principle;

o Establishing voluntary, civil paternity consent programs;

o Authorizing demonstration programs for an assurance system,
for revised federal payment formulas to states, and for the
development of support order establishment outreach programs; and

o Studying the feasibility of an employment program for
noncustodial parents.

If I may, I'd like to mention one aspect of this problem which I
know is of great concern to many people. This issue has often been
highlighted as an effort to get "deadbeat dads." However, using a
label like this over simplifies the problem. The intent of my
legislation is to help children and families, not to punish people.
We must remember that there are two types of people who fail to pay
child support: those who avoid payment because they do not want to
pay, and those who want to contribute but do not have the means to
pay. These situations must be dealt with differently. There is no
question that those who have the means, but still refuse to accept
their responsibility to their children must be dealt with seriously.

However, we must take into account those noncustodial parents who
want to pay support but cannot because they lack employment, or lack
the skills to get a job that will allow them to pay their support.
This will benefit everyone involved. That is why my legislation
includes a provision which recognizes the need for employment
assistance which is intended to build upon the demonstration projects
of the Parents Fair Share Demonstration Programs which developed as a
result of the Family Support Act of 1988.

Again, Mr. Chairman, thank you for calling this hearing. This is
clearly an issue that we all must pay attention to, and I look forward
to working with the Administration, my colleagues in the House, and
our friends in the other body to ensure that a high priority is placed
on making changes to the child support enforcement system which will
make the system work as efficiently as it possibly can. As citizens,
we must place the highest emphasis on the responsibility we have to
our families. As legislators, we have a responsibility to ensure that
the we take every measure available to support the most vulnerable in
this country -- children.

Thank you very much.

Chairman Ford. Thank you very much for your testimony, and
thank you once again for your input.

You suggested there are two types of people who fail to pay child
support. You mentioned those who avoid the payment, and those
who want to pay but just can't afford to pay. What do you suggest?
How do we address that.

Mrs. Kennelly. I really made an effort in drafting new legisla-
tion to go out into the community and fmd out if what we think
is happening is happening. Let me give you an example from Con-
necticut. This is a divorced woman with two children. The husband
moved to Florida, has a small business, is known to travel quite
extensively, has a new car every year, and lives very well. She is
back in Connecticut and cannot get that child support. He moves
constantly to avoid it. Here is a case where an individual doesn't
want to pay his child support.

Then you can have another situation where the father would
very much like to pay. By the way, sir, may I say, in most of these
cases the male parent is not on the scene. He is not the custodial
parent. We are getting some custodial male parents. Most of it sta-
tistically still is mostly female.

We have individuals who want very much to pay the child sup-
port, but who don't have the job skills or opportunity, and that is
why we have this job program.

The third situation is where the custodial parent, often the moth-
er, doesn't want the father to see the children. He says, "Why
should I pay if I can't see that child?" And we have case after case
like that, and that is why I emphasize, support and visitation
rights are two different things. We should understand that the ab-
sent parent isn't always causing the trouble. No mother should use
visitation as a hammer so she muddies up the waters so much that
the child doesn't get the support and the family is still fighting. Di-
vorce is never easy, but to involve the child in this situation makes
it worse, and usually for the child.

So I think there are answers in job training. We can have, as Mr.
Grandy knows, Mrs. Johnson worked on it, demonstration pro-
grams where there can be jobs.

Chairman Ford. What do you suggest for that father who moves
from State to State to avoid payments? The Interstate Commission
doesn't want to support the Internal Revenue in the collection proc-
ess.

Mrs. Kennelly. There are numerous suggestions on how we can
improve on the system that we have right now. Sharing of informa-
tion is terribly, terribly important. As usual it is that old bogeyman
that you and I have dealt with, putting priority on child support
enforcement within the individual States so that you could have
sharing of information.

There are ways to do it within the courts; there are ways to do
it within the State systems. There are documented improvements
that we can do. The Interstate Commission has documented them
and I think they should be tried.

Chairman Ford. Thank you.

Mr. Grandy.

Mr. Grandy. Thank you, Mr. Chairman.

Barbara, could you just explain for the committee the reasons
behind the Commission's decision not to include a Federal child
support assurance program in your fmdings, and also the thought
behind not federalizing the system? In other words, not using the
IRS as the collection agency?

Mrs. Ki:nnelly. I think there is a feeling. Congressman Grandy,
that many States have made a great deal of effort to make this sys-
tem work. I come from one of those States, Connecticut. Obviously
there are some States that make no effort whatsoever. Yet, the
Commission felt that it would be very important not to do away
with those States that have done a fairly decent job of getting child
support enforcement orders come to fruition and start from scratch
with a Federal system.

You and I both know that when you get into a Federal system,
it is huge. I am not going to say it would be bureaucratized before
it came into existence; we don't know. If it was done correctly, it
should not happen. But it would be beginning from the ground floor
and starting and building up again.

We also know the IRS is overworked right now, that new individ-
uals would have to be hired to carry out this tvpe of situation.

Mr. Grandy, before you and I knew each otner, I was very active
in the 1984 child support enforcement amendments. That resulted
from Grovernor Campbell and me working very closely. I came from
a State that had very good child support enforcement legislation.
He came from a State that had none. When I say none, very little.

He wouldn't mind me saying this. He had a sister who was lefl
with three children. The father was gone. He became so interested
in this situation that we worked together taking the good ideas
from States like Connecticut and putting them into the Child Sup-
port Enforcement Amendments of 1984. This was done on the old
system of working from the State level.

As I said, if this effort by so many of us who have gone into the
interstate suggestions should fail, I would have to look at the Fed-
eral system. But right now I think it is the idea that we don't want
to start from scratch; we want to build from what works.

Mr. Grandy. And one of the things we want to work is creating
the uniform data base so we can track down the miscreants, isn't
that correct?

It seems to me if we are going to have a uniform system, we have
to begin with the information base before you can build the enforce-
ment mechanism in at the Federal level, wouldn't you agree?

Mrs. Kennelly. Absolutely. And that is why we have the match-
ing legislation. That is why we have encouraged the States to do
what they should do and could do.

But we know from the information from your own State and I
know from my State, those States are strapped, too. However, I
think they can build from the system rather than starting a whole
new system.

Mr. Grandy. The bill that we intend to introduce on our side is
going to track very closely with the Interstate Commission's find-
ings, and will probably cling very closely to your decisions.

Let me go now to that very controversial issue of visitation by
male parents that don't pay support. We talked about this when
you were on the subcommittee.

Is there any data, is there any demonstration project, is there
any guidance we can get to try to figure out a way to solve this
problem? Are we looking at demonstration projects that would im-
pose binding alternative dispute resolution over these visitation
rights?

I think we are kind of at a loss for really good information, are
we not?

Everybody wants to do something about this. I agree with you
that perhaps just tying it into a child support bill may slow the
process down, because it is a weak link in a chain. What can we
do?

Mrs. Kennelly. Well, I have to tell you. Congressman, in my bill
are some things I don't like to do. For one thing, I have been work-
ing on this subject for so long, I have gotten quite friendly with the
Divorced Parents Association, and I know their problems.

What you have to do when you get really to the point of frustra-
tion that we are at right now is you have to look at situations like
licenses. When you get a license to go into a certain business with-
in the State, it is known whether you have back payments on child
support.

People, who really are so mad they don't want to do something,
aren't going to do it unless it further complicates their lives. If peo-
ple aren't paying that child support, they then cannot do some
other things they want to do and make tneir lives the way they
should be.

So I think there is an irritant factor to some of the suggestions
we are making. People should know that when you do specific
things, and you do have back payments, that unless those back
payments are paid up, you are not going to get this other good
thing in your life. I don't like to do it; it is punitive, but we have
gotten to the point where we have so many poor children in this
country because someone is standing there with the child support
enforcement order in their hands and getting no child support.

Mr. Grandy. Is there a need to get some component in the legis-
lation to try to at least address the problem with visitation rights?

Mrs. Kennelly. Yes, I have said this time and time again, and
this is something I think we should look at very definitely, because
people on the other side get very frustrated. I'm talking about a
parent who won't pay because he can't get visitation rights and
says, "Why should I? When are you going to start thinking about
me?" So I think that could be a dual piece of legislation.

However, having said that, I don't want to imply that because
you don't get visitation rights, you don't have to get child support.
That is wrong. That child deserves support whether those parents
are fighting or not.

Mr. Grandy. Do you feel as though if we can't come to some kind
of closure on welfare reform, we ought to move this piece sepa-
rately and try to get a Child Support Enforcement Act done as
quickly as possible?

Mrs. Kennelly. I really do, sir. The numbers just scream for at-
tention. We are letting generations now grow up without that ade-
quate support.

And, as you know, I am as committed, as you are, to welfare re-
form. I want to do that very definitely, as does the whole country.

But at the same time it is going to be a big piece of legislation. We
are strapped with a deficit that is finally getting attention.

So I would say we know so much about child support enforce-
ment that we should use that knowledge and go forward. If it could
go in tandem, fine, but I wouldn't want to hold up the child support
until we finish the welfare reform.

Mr. Grandy. I agree with that.

Thank you, Mr. Chairman.

Chairman Ford. Mr. McDermott.

Mr. McDermott. I only have one question of Ms. Kennelly.

Coming from a State that has made a real effort on paternity es-
tablishment and child support enforcement, having been on the leg-
islature and participated in that actively for a long time, my ques-
tion for the commission is, how long are you willing to wait, to fid-
dle around and let it drift?

I have an awful lot of experience, thinking there ought to be a
Federal system and using the IRS. I would like to hear the discus-
sion that went on at the Commission. Are they willing to wait until
1995 or 2000?

Mrs. Kennelly. I believe, Mr. McDermott, the answer is up to
you, up to many people in this room, and up to Mr. Bradley. The
Commission had extensive hearings. It was a good crosssection —
lawyers and judges from the legal system, and consumer citizens.
They were dedicated to building on the system as it is now.

But I am afraid that the answer to your question is up to you
and me and our colleagues on the House side, and Mr. Bradley and
others. If we can bring forth meaningful legislation that does make
child support enforcement work, then we should do it. If we can't,
we are going to have to go to the solution that you would like.

This reminds me, sir, very much of where you stand on the sin-
gle payer and health care. If we can't make health care reform
work, maybe your idea will come. But let's give it one last chance.

Mr. McDermott. I guess I listen to Mr. Grandy and I tend to
think that systems are best developed at the State level. I like it
done closer to home.

But in this one, I am at a level of frustration where I am not
very patient anymore. I think that there is going to be an interest-
ing debate here, about how long we are going to wait. Because
clearly something needs to be done.

Mrs. Kennelly. You are right. Because the interstate is one of
the hardest nuts to crack. Once they go across that line, many of
the problems begin. Statistically, it is huge.

Mr. McDermott. When you have the movement of labor in this
country, it is very difficult for States to follow up on people moving
from place to place. It is not so much that I think that parents are
trying to avoid paying in many instances, but I think that it is
often necessary to move for jobs. We have a situation where major
employers in the State of Washington have placements all over the
United States. It becomes more difficult to remain in one State
when you work for a company that has people in Wichita and Ala-
bama and Pennsylvania. I think there is a real practical problem
of remaining at the State level with this issue. That will be a part
of our discussion, I am sure.

Thank you.

Mrs. Kennelly. Thank you, doctor.

Chairman Ford. Mr. Reynolds.

Mr. Reynolds. I want to thank you as well for your testimony.

Being a new member, this is one of the things I very much want-
ed to focus on when I came to Congress. I will be looking to see
as well what kind of recommendations we can do to improve the
system.

I, too, though, am wondering about some sort of uniform Federal
system, bringing in the IRS to better enforce the collection of these
payments. Could you tell me and the committee what are the con-
siderations in having the IRS involved?

Mrs. Kennelly. First of all, the IRS is already involved, on re-
funding. They have done a very good job and that has improved the
system a great deal.

I well remember, though, when the Chairman and I were push-
ing so hard to have that involvement, how the IRS resisted. Once
the statute said they had to get involved, they did the job they
should do.

But once again, I go back that the IRS system right now. If you
look at the statistics of auditing, the statistics of following through
on cases that have to be tracked, they are incredibly overworked.
And if we are really serious, as I think we all are, about making
the system work, I don't know if overloading an area that already
is overloaded, is the answer.

Now, Senator Bradley is not here yet, but he and I did not go
on the exact same bill, so you can see this is a difficult situation.
He has criminal penalties in his bill. He involves the whole health
care system in his bill.

I have tried to keep mine less broad because I want to get the
heart and soul of trying to make the system work, so we don t have
to go through a Federal system.

States have agencies set up, many of them computerized and
able to do what they are supposed to do if they can get this inter-
state help. If we go to the Federal system, it gets under Federal
jurisdiction, and many of the State efforts that do work will be set
aside and we begin all over again.

Mr. Reynolds. Would you just briefly comment on the criminal
part of Mr. Bradley's bill or your ideas

Mrs. Kennelly. No, I won't. I will let his testimony do it.

How do I feel? I have seen both sides of this question as a
woman of my age with four children and grandchildren. I know you
don't get divorced because things are working out. Then you get
into arguments over visitation, arguments over penalties or pay-
ment. We have let this system in this country not be rough enough
or tough enough; there isn't enough stigma on not paying your pay-
ments. I think we can do some things before we go into criminal
penalties.

I would rather keep this in the civil arena and make it more
workable before I went into criminal penalties. But I will let you
read Mr. Bradley's testimony because we disagreed on this.

Mr. Reynolds. Thank you very much.

Chairman Ford. Mr. Santorum.

Mr. Santorum. No questions.

Chairman Ford. Mr. Camp.

Mr. Camp. Thank you, Mr. Chairman. I just have one.

I am interested in your statement that transferring program re-
sponsibihties to the Federal Government is not the answer. I be-
lieve the Commission on Interstate Child Support that you served
on also came to that conclusion.

If you could just briefly set forth why that conclusion was
reached.

Mrs. Ki-:nneli.y. The basic bottom line, Mr. Camp, is that we feel
we have worked a number of years to improve the State system.
We have an approach to doing interstate enforcement better, which
was set out in the interstate study. There is a feeling we should
give one final 100 percent effort to make the system we have now
work. It is built on the States doing their thing and then having
cooperation between the States for interstate collection. I think we
should try it one more time with new legislation, written by a new
administration.

If that doesn't work, as I said, I would have to say, "Go to a
Federal system." But I just don't want to start a whole new depart-
ment.

Mr. Camp. Thank you. No further questions.

Chairman Ford. Mr. Levin.

Mr. Lp:vin. Thank you, Mr. Chairman.

Welcome. If this is kind of the last crack at it in terms of the
present structure, relying on the States, what one portion of your
bill would make the most difference?

Mrs. Kennelly. Well, I think paternity is one, Mr. Levin. I think
we have really come a great deal of the way scientifically. We can
establish paternity through new and very simple methods. One pro-
gram that works well for child support enforcement is to establish
paternity at the hospital. It is proven statistically that the fathers
do show up at the hospital.

I think I would use the programs that work now on paternity.
I would use that information, including information on birth certifi-
cates as much as we can. Of course, there is always a question, as
you well know, in certain cases.

Mr. Levin. I think that is helpful. It will help us to focus.

Mrs. Kennelly. We are into much broader areas, let me tell you.

Mr. Levin. But I think that helps. It will help focus the discus-
sion that follows. Thank you very much, and for all your efforts.

Mr. Levin. Thank you.

Chairman FoRl). Mr. Kopetski.

Mr. Kopetski. No questions.

Chairman Ford. Ms. Kennelly, thank you very much.

I certainly think we can move this legislation, but I don't see any
reason why we can't move welfare reform at the same time. Given
the urgency and the need of this legislation, I think this sub-
committee, the full committee and the Congress ought to be pre-
pared to move both. In 1988, we did both.

Mrs. Kennelly. You are the chairman, Mr. Chairman. You are
the chairman.

Chairman Ford. I am going to need your help and support. I am
even going to seek two members of the Ways and Means Commit-
tee, you and Ms. Johnson, to serve on a task force to look at the
recommendations made by the Interstate Commission to really

keep us abreast of the recommendations and how we should place
those components in the bill, and be active participants. But I cer-
tainly have the intent of moving welfare reform.

Mr. Grandy, I certainly look forward to participation from you
and the Republicans, and hopefully we can have a bipartisan effort
in this. But I want to move both. I don't see any reason why this
committee cannot move both welfare reform and child support en-
forcement.

Mrs. Kennelly. You know, Mr. Chairman, you and I have
worked very closely over the years. I will work with you again.

Let me sa^y this to you that welfare reform means many things,
everything from job training to health support. The definition of
welfare reform is so different in so many different people's minds.

In child support, I think we have done such a study. We know
what is needed, and we could move very rapidly on child support
as you and I did with the 1988 Family Support Act together. We
sat in this room for hours. I say at home I dedicated 2 years of my
life to it. We know right now even some of the things that were
in the Family Support Act aren't being carried out at the State lev-
els. There is so much we learned from that.

Welfare reform is so important to this country that I think it has
to be done as that was done, hour after hour after hour, and I
think child support enforcement can be done more rapidly.

So that is the only reason I hesitate to try to couple them. But
we will talk further and I will take your lead, sir.

Chairman Ford. Thank you very much, Ms. Kennelly.

We are delighted to have Ms. Pat Schroeder from Colorado,
someone who has shown leadership in this area, as our next
witness.

We are delighted to have you before the subcommittee today. We
recognize you at this time. I am sorry for the delay and the wait.

STATEMENT OF HON. PATRICIA SCHROEDER, A REPRESENTA-
TIVE IN CONGRESS FROM THE STATE OF COLORADO

Mrs. Schroeder. No problem, Mr. Chairman. Thank vou. I am
so glad that you are here and pushing on this, because I know how
dedicated you and members of your committee are. And it is also
a great honor to follow Congresswoman Kennelly.

If you don't mind, I am going to ask unanimous consent to put
my testimony in the record and just try

Chairman Ford. Your full testimony will be made part of the
record and you may summarize it or whatever you like.

Mrs. Schroeder. Thank you very much.

Let me try to target whv I am here, although most of what we
are talking about is parallel to what you have been looking at.
First, in the Congressional Caucus for Women's Issues child sup-
port enforcement has been one of our main concerns, and we are
frustrated up to the top of our earlobes with the fact that we pass
bill after bill after bill and we still have lousy results.

Second, I used to chair the Select Committee on Children back
when we had it, and child support enforcement was one of our
main causes. We have all sorts of studies which, Mr. Chairman, I
would like to give to your committee, because I think you can use
them very well.

And we had some very, very interesting town hall meetings with
the Family Law Bar to try to find out where the glitches were in
all this legislation that we had passed and why more progress
hadn't been made. The bill that I introduced really tries to pick up
on several things we on the select committee learned from the
Family Law Bar.

First, their feeling was most States felt that the Federal Govern-
ment was primarily interested in child support enforcement as it
related to AFDC, and not that it was a civic duty to pay your child
support no matter what income level you were, and that this
should be done, period. So it got targeted more into the AFDC area.

Second, it is very hard to get States very enthusiastic about col-
lecting some other State's money to save another State money. I
mean, why does Tennessee want to spend a whole lot of money
going out and chasing someone down to send that money to Colo-
rado so Colorado doesn't have to kick in and help support that fam-
ily?

Every one of us agrees that child support enforcement is not a
class issue. It cuts across the entire society. And child support en-
forcement has to be done across the entire society, or we miss it
all.

One of the studies that haunts me the most was the Census Bu-
reau's 1992 study of 52,000 children that were the subject of
divorce. They found 4 months after that divorce, 37 percent less in-
come went into those families. They found that of those children 19
fjercent of them were in poverty before the divorce, and 4 months
ater, 36 percent had moved into poverty.

But the most haunting of all is AFDC doubled in that period; the
usage of food stamps by the custodial parent tripled.

So it is the same old thing, and this is 1992, after all of our won-
derful attempts. So I think we have to go at this with much more
vigor than ever before.

Our goal on the Select Committee was to say that children
should be held harmless economically in a divorce as much as pos-
sible. There is no wav we can legislate that they can be held harm-
less emotionally, and we know there is a lot oi damage done there
and there is no way we can hold that they are going to be held
harmless in other ways, but at least economically we can try a
whole lot better than we have been trying. I must say we don't find
a lot of people volunteering to pay any bills they are asked to pay.

This bill, H.R. 915, covers one area that you haven't talked about
here, because it is not in your jurisdiction, but I urge every one of
you to become compassionate about, because if we don't it will be-
come the new loophole. We are starting to see it emerge all over
the place emerge, and it is the loophole that everybody will drive
a truck through, and that is bankruptcy. If we do not put that you
cannot use bankruptcy to get out of the your child support, if you
don't get that in the Federal law, that is the new one. So that has
to be a piece of anything that we do.

H.R. 915, which I am not going to go through chapter and verse
because you have got too much you can read, includes 16 different
points the bar told us we can work on the improve child support
enforcement, such things as putting Social Security numbers on
marriage licenses and divorce detection. There are any number of

other areas that would really help if we had this uniform system,
very similar to what Congresswoman Kennelly was talking about
ana what the Commission on Interstate Child Support Enforce-
ment did.

I will tell you what I think the debate between the Federal and
the State issue is. We know the Federal Government isn't enforcing
nine-tenths of the laws that we pass. We know IRS is overworked.
We know Immigration is overworked. We know every agency we
have is overworked.

When you look at child support enforcements at the State level,
you find that there are caseworkers with over 1,000 cases. I don't
care how well intentioned they are. How do you do 1,000 cases?

So we have to keep working to get the infrastructure. It is out-
rageous to me that we don't have computers out there that are all
tied together in some kind of a network. Think about it. You could
take your VISA card and run it in a machine and within seconds
you know whether you have credit or not. Why can't we work out
something much better on this, whether it is between the States
or at a Federal level? I don't know, but it is really time we stop
putting all this patchwork together and we move forward.

I also hope the gentleman from Washington can help us too, be-
cause when I look at the paternity issue, Congresswoman Kennelly
is absolutely right, paternity is very critical. Washington State is
number one in establishing paternity. Many other States have to-
tally fallen off and not established paternity at all. And they tell
us when we grill them in the select committee that it is because
of the Federal Government that they are not pursuing paternity,
because under some of the new health care standards, the woman
doesn't stay in the hospital long enough to do that.

Now, if that kind of thing is going on, this is also a committee
that can really say, "Wait a minute, wait a minute, do not use one
regulation to hide behind the other," saying that you should estab-
lish paternity upon birth. If you don't get it then, good luck ever
getting it.

So I think maybe the gentleman from Washington can help us
sort that one out, too. But I thank you for letting me be here.

Those are some of my generic thoughts about loopholes to come,
problems that have come along. And I just find it very, very trou-
bling that we haven't made more progress. And I think wherever
we leave it, we have got to make sure there are other resources
there to enforce it.

I think we are afraid to take it federally for fear we won't commit
the resources, and then we get stuck. So it is easier to leave it at
the States and then blame them. And we are not going to give the
States the resources to really do it either. So let's stop the blame
game and let's get these children the type of support they are enti-
tled to.

Thank you.

[The prepared statement and attachments follow:]

TESTIMONY OF REP. PATRICIA SCHROEDER (D-COLORADO)

before the
House Ways and Means Subcommittee on Human Resources
June 10, 1993

Mr. Chairman:

Thank you for allowing me to testify on behalf of my bill, H.R.
915 and about the dismal state of child support enforcement in
America today. Paying child support is a fundamental civic
responsibility. While those with child support obligations may
choose to run, they should not be allowed to hide.

I salute my colleagues Rep. Barbara Kennelly and Senator Bill
Bradley for trying to come up with a solution to the problem. I
think my proposal dovetails nicely with their approaches.

It was just last year when I testified before you on the need to
strengthen child support enforcement. Several changes have
occurred since then.

First, and perhaps most importantly, there is a new
Administration. As a former governor, President Clinton is
familiar with the states' problems in collecting child support
enforcement. As a presidential candidate. President Clinton
campaigned on the promise of making our child support enforcement
policies stronger and more coherent. Just this past February,
the President Clinton outlined a broad welfare reform initiative
with, as a key component, an aggressive assault on deadbeat dads.
Thus, I think with this Administration we have an opportunity to
drastically improve child support enforcement policies.

Second, Congress unexpectedly eliminated the House Select
Committee on Children, Youth, and Families. With that committee
went another voice for reform in child support enforcement. I
had been looking forward to working with this committee in
pursuing that goal.

The Select Committee closely followed the development of child
support enforcement legislation and policy recommendations. The
result of its research and analysis is my bill, H.R. 915, the
Child Support Enforcement Security Act of 1993.

Specifically, the legislation contains 16 tools for states to use
to improve child support collections. But it does not just ask
more of states. It changes the federal payment structure to the
states, providing them with the additional resources that are
absolutely critical if we want this system to work.

Caseworkers lack essential training and are reguired to manage
caseloads in excess of 1,000 families. Even highly trained
caseworkers can't handle this type of workload. Simply put, the
child support enforcement system needs new resources--trained
staff who can use state-of-the-art computers--to bring the system
into the 21st century.

In addition, H.R. 915 amends the bankruptcy code to ensure that
noncustodial parents cannot use a declaration of bankruptcy to
avoid their financial obligations to their children and former
spouses.

I would like to submit for the record a summary of H.R. 915 that
lists the detailed changes the legislation makes. The Select
Committee last year compiled a fact sheet on child support
enforcement. I would also like to submit the fact sheet, which
outlines facts, statistics, and studies crucial to understanding
the scope of the problem, into the record.

I would like to mention one of those studies because I think it
emphasizes just how important a reliable source of income from a
noncustodial parent is to these children.

A 1992 study from the U.S. Bureau of Census that followed nearly
52,000 children from October 1983 through May 1986 found that
within 4 months of their parents' separation, the family income
of the children declined by 37 percent. Even more disturbing,
the percent of children living in poverty increased from 19
percent to 3 6 percent in the 4 months following their parents'
separation. The number of these children relying on AFDC
doubled, and the number of food stamps recipients nearly tripled
during the first year of parental separation.

Mr. Chairman, the failure to pay child support is a national
disgrace. The daily stories in the newspapers across America
about deadbeat dads mirror the heartwrenching stories that flood
my office. Custodial parents write of endless delays, some
dragging on for years, before child support payments are withheld
from wages of non-custodial parents. They write of thousands of
dollars of unpaid child support. They write of their constant
effort to locate the absent parent.

I do not fault the caseworkers on the front lines. They are
trying the best they can to fight on behalf of custodial parents
without modern-day equipment and without access to State records.
We can make their jobs easier.

Congress has been trying since 1975 to improve the collection of
child support. But unfortunately, the focus of federal efforts
until recently has been on trying to recoup expenditures on AFDC,
rather than trying to make it clear that failure to pay child
support will not be tolerated. In the 102nd Congress, we took
several small steps toward this goal. But much more is needed.
It's time for both the federal and state governments to put their
money where their mouths are when it comes to collecting child
support. It's time to dedicate the resources and put some teeth
in the program so that the program will work. Systematic
reforms, more tools, less cumbersome procedures, and automation
are needed to move the system into the 21st century.

I commend the work of the Commission on Interstate Child Support,
which released its findings and recommendations to Congress last
summer. Indeed, some of the measures contained in my legislation
are included among the Commission's recommendations.

With this hearing, this subcommittee has shown it is ready to
move on meaningful child support enforcement reform. I'm ready
to go and will do all I can to help you.

It is time for the receipt of child support to be as automatic as
the receipt of Social Security is to our nation's senior
citizens. We owe this much to our children.

SOMMARY or H.R. 915
"CHILD SUPPORT ECONOMIC SECURITY ACT OF 1993"

PURPOSE: To correct deficiencies in the child support
enforcement system to ensure that children receive consistent
support from their noncustodial parents.

TITLE I. Child Support Enforoemant AmendmantB

Section 101. Requires states to have statewide, uniform rules of
child support enforcement.

Section 102. Requires states to have on-line access to all data
bases maintained by the state or any local jurisdiction.

Section 103. Ensures continuing child support until children
complete high school and for disabled children beyond the age of
18.

Section 104. Requires that income from lotteries, insurance
settlements, and legal proceedings be garnished to offset child
support arrearages.

Section 105. Requires states to deny issuance of licenses to
individuals unless a good faith effort has been made to pay any
child support arrearages owed.

Section 106. Requires reporting of child support arrearages to
consumer credit reporting agencies.

Section 107. Eliminates the statute of limitations with respect
to collection of child support arrearages.

Section 108. Requires social security numbers on marriage
licenses and child support orders.

Section 109. Clarifies that nonsupport and denial of visitation
rights are to be treated as distinct issues.

Section 110. Requires timely response by states to interstate
locate requests.

Section 111. Requires the Secretary of the Department of Health
and Human Services to issue regulations for processing of
interstate child support cases.

Section 112 . Replaces federal incentive payments with an
increased reimbursement rate of 90 percent.

Section 113. Requires states to adopt laws similar to the
Uniform Interstate Family Support Act.

Section 114. Establishes a national commission to recommend
national child support guidelines.

TITLE II. Bankruptcy Amendments

Sections 201-208. Amends the federal bankruptcy code to ensure
that support owed to children and custodial parents is paid even
when the noncustodial parent declares bankruptcy.

"CHILD 80PP0RT ECONOMIC SECXnilTT ACT 07 1993"
A FACT SHEET

CHILDREN LIVING IN SINGLE-PARENT HOUSEHOLDS CONTINUE TO INCREASE

• More than ten million families — almost twenty-nine percent
of all families — were headed by a single parent in 1991
compared with just thirteen percent in 1970. (U.S. Bureau
of the Census [Census Bureau I], Household and Family
Characteristics . 1992)

• While most single-parent families in 1991 were headed
by women (8.7 million or 87 percent), the number of
single-parent families headed by men (1.4 million or 13
percent) has increased since 1970 when ten percent of
single-parent families were headed by men. (Census
Bureau I)^

• The number of children living in single-parent families
almost doubled from 1970 to 1990. In 1970, 8.2 million
children lived with just one parent compared with 15.9
million in 1990. (U.S. Bureau of the Census [Census Bureau
II], Marital Status and Living Arrangements. 1991)

FAMILIES HEADED BY SINGLE WOMEN FACE ECONOMIC PERIL

• In 1990, the poverty rate for single-parent families with
children under 18 headed by women was 45 percent. (U.S.
Bureau of the Census [Census Bureau III], Poverty in the
United States; 1990. 1991)

• Women who are single parents rely on child support for
economic assistance because their earnings are so low —
averaging $377 per week for full-time work during the first
quarter of 1992. (Bureau of Labor Statistics, 1992)

• In a study of 21,000 divorced or separated families, the
family income of the children declined by 37 percent within
four months of their parents' separation. The proportion of
children living in poverty increased from 19 percent to 36
percent by the fourth month after a family disruption. Nine
percent of children were in families receiving AFDC benefits
before family disruption. This population doubled to 18
percent in the months following separation and increased to
22 percent one year later. (U.S. Bureau of the Census
[Census Bureau IV], Family Disruption and Economic Hardship.
1991)

• Home ownership is more difficult for single-parent families.
In 1989, single parents were less than half as likely as
married parents to be homeowners (35 percent versus 74
percent). (U.S. Bureau of the Census [Census Bureau V],
Housing Characteristics of One-Parent Households 1989. 1992)

TOO FEW MOTHERS RECEIVE CHILD SUPPORT

• In 1930, only r.3 percent of mothers who were single parents
had been awarded child support. Of those awarded support,
51 percent received the full amount, 24 percent received
partial payment, and 25 percent received nothing at all.
(U.S. Department of Health and Human Services, Office of

' According to the Census Bureau's Housing Characteristics of
One-Parent Households. 1989. fathers maintained 21 percent of
single-parent family households. This percentage differs from that
calculated in the Marital Status report because the two surveys use
different bases to calculate the percentage of fg^miljgg headed by
single fathers. The Marital Status report calculated"^ the
percentage of single-father families as a percentage of of single-
parent families, while the Housing Survey calculated the percent
of single-parent households headed by fathers.

Child support Enforcement [OCSE] , Fifteenth Annual Report to

Cpngress, 1992)

• In 1990, 68 percent of white single mothers received child
support awards, compared with 3 5 percent of African-American
single mothers and 41 percent of Hispanic single mothers.
(Committee on Ways and Means [Ways and Means] , Overview of
Entitlement Programs. 1992^

• Only 43 percent of mothers involved in interstate child
support cases reported receiving regular support and 34
percent reported never receiving any support, compared with
60 percent and 19 percent, respectively, of mothers in
intrastate cases. (General Accounting Office [GAO I],
Interstate Child Support. Mothers Report Receiving Less
Support from Out-of -State Fathers. 1992)

• The less education a single mother has, the less likely she
is to receive child support. In 1989, 67 percent of single
mothers who were not high school graduates had been awarded
child support, compared with 76 percent who were and 79
percent who had completed four or more years of college.
(Ways and Means)

SERIOUS PROBLEMS PERSIST IN CHILD SUPPORT ENFORCEMENT

• On average, it takes states from 5 to 16 weeks to serve a
child support order and from 12 to 26 weeks for states to
respond to a request from another state. (General
Accounting Office [GAO II], Interstate Child Support. Wage
Withholding Not Fulfilling Expectations, 1992)

• State reliance on more than six different procedures for
requesting interstate wage withholding creates a lack of
uniformity in collection procedures resulting in unnecessary
delays in processing withholding orders. (GAO II)

• Delays in responding to state requests for wage withholding
are caused most often by missing or inaccurate information,
noncustodial parents leaving an employer before a
withholding order is served, caseload size, lack of computer
automation, state central registries that do not screen and
verify as much information as they could, and inadequate
familiarity with appropriate interstate withholding
procedures. (GAO II)

• During FY 1990, the Office of Child Support Enforcement
notified six states that audits of their programs indicated
that they were not in substantial compliance with Federal
requirements. (OCSE)

CHILD SUPPORT LOWERS POVERTY RATE. BUT AMOUNT OFTEN IS INADEQUATE

• In 1990, single-parent families that received child support
had significantly lower rates of poverty (24 percent) than
families that received no child support payments (43
percent) . (OCSE)

• African-American single mothers are less likely to be
awarded child support than are white or Hispanic women. In
1989, the average amount of child support received by white
women ($3,321) was 38 percent higher than that received by
African-American women ($2,263). The amount received by
Hispanic women was not significantly different from that of
white women. (Ways and Means; OCSE)

• While approximately 43 percent of white mothers who received
child support in 1990 had health insurance benefits included
in their awards, only 21 percent of Hispanic women and 28
percent of African-American mothers received them. (OCSE)

June 1992

72-449 - 93 - 2

Chairman Ford. Thank you very much.

You mentioned in your written testimony recommending change
in the Federal matching rates. Have you looked into any cost fac-
tors that might be involved in changing the rates from 66 to 90
percent?

Mrs. ScHROEDER. Absolutely, and it will be more costly, but that
is my point. If we are going to opt, as the Commission said we
should, to leave it with the States. And if we now look at the States
and find there are many States where caseworkers have 1,000
cases, if we don't increase that, we are kidding ourselves.

There is no cheap way to do this. You have got to have people.
You have got to have people and you have got to have the tools in
their hands to do it. And that has been, I think, the big shortfall
in Federal legislation. We have federally asked them to do it and
we have never federally funded them to do it. And it has gotten
harder.

Chairman FoRD. They have failed to promote cost effectiveness?

Mrs. ScHROEDER. I think that your actions in 1988 were helpful
as you tried to get these computers that were interactive. I don't
know how many States have really brought that up. We asked I
think a year and a half ago and got a statistic. I have not asked
since then. That would be an interesting question.

But it is surprising to me that VISA and MasterCard and Amer-
ican Express and everybody else can figure out how to do that, but
not the Federal Government. Maybe we should contract it out to
them, I don't know.

Chairman Ford. Mr. Santorum.

Mr. Santorum. Thank you, Mr. Chairman.

Thank you for your testimony. There are a lot of things in your
bill that I feel very strongly about and agree with you on. Just a
couple of questions as far as the scope of your bill is concerned, and
the same questions really were directed to Ms. Kennelly.

You don't have in this bill anything about child support assur-
ance.

Mrs. ScHROEDER. That is right.

Mr. Santorum. You feel it is the best approach at this point to
move forward with a clean bill on child support enforcement and
not complicate matters by trying to put a new entitlement program
in here? What are your feelings?

Mrs. ScHROEDER. My feelings on the child support assurance is
I am a little uncomfortable about it because I think unless we real-
ly make sure that there are the resources at the State level to do
this, there will be a real temptation to just say we can't find them
and plug into the child support assurance.

That pains me to say that because I still want the child to get
their care, their fair amount. But the issue becomes, it is still so
much better for the father. I used to practice family law and it was
the most painful thing I ever did. I would do anything other than
practice family law. It is a nightmare. Nobody wants to do it.

If you can keep the pay issue entirely separate from the visita-
tion rights, I honestly think you are going to have a lot more father
involvement or absent parent involvement, or the mother, too.
When people just say this is totally decoupled, there is absolutely

no connection with this, support is support is support, if we can
decharge that, I think that is helpful.

Mr. Santorum. Can you explain why you feel that way? Because
most of the arguments you hear are that if you couple them that
might actually

Mrs. ScHROEDKR. Because what you find is that when people-

maybe they get remarried, maybe they move, maybe they have just
gotten in great trouble financially. We are a country where you can
do that not only in Washington but individually very well. But then
you have to start thinking about where do I cut?

There is this notion that if you could find some way that you are
not allowed visitation rights, then you shouldn't have to pay. Some-
how in an awful lot of people's minds, you only pay if you get to
visit. So if you find some reason that you are not allowed to visit,
then you have got an excuse not to pay. They have made it into
a fairness issue.

To me, they should be totally separated, because I think if people
knew you have to pay, this is the most important thing vou have
ever done, brought a child into the world, and you are liable, male
or female, to sustain that, then I think you will get a lot more
interested in visiting, because you will be paying no matter what.

That is not true for all people. I realize there are some things
very serious and very different.

Mr. Santorum. That is where I am losing the argument. I would
assume that the reason they are not visiting is because they are
not being allowed to visit. That is not necessarily the case?

I think you can find studies that show that in all cases that is
not necessarily the case. In some cases that is very true. But you
are making great generalities about 50 States and hundreds of
thousands of people. There are some people who use that as an ex-
cuse as to why they don't pay. And it becomes the fight among the
parents again.

The bottom line is — what I would ask you to do is no matter
what you end up supporting, the bottom line continually has to be,
how do you do the best job of holding the child harmless?

Mr. McDermott. If the gentleman will yield, I concur with you,
having been on the other side of child family law. In the no-fault
divorce situation in this country you no longer have to prove why
you got a divorce, you take off the table the question of property,
which makes it pretty simple. In most States they figure out how
to divide up the property. The only place left where the anger
comes out is over the custody of children. Attorneys and psychia-
trists get involved in great detail about who wants the custody for
what reasons. They claim, "If I don't get the visitation, then I am
not going to pay."

The real principle here is the one Mrs. Schroeder is raising, the
holding harmless of the kids. The kids didn't choose these two par-
ents to fight over their heads. They didn't choose to go into poverty
because their mom and dad are in a big fight.

Our job, at least my drive in this kind of bill, is to try to get the
kid protected against the stupidity of adults, fathers and mothers,
who use child support as the place to get even with their ex-spouse.

That is really what happens. That is why it is very difficult to
extract the economic issue. This is from the practical experience of

sitting on way too many cases. And I agree with you, it was the
hardest part of my practice. I wanted to get out of family law as
quickly as I could, because often you feel like neither parent should
have the kid.

Mrs. ScHROEDER. Exactly. You want to take it home and you are
going to protect the child.

Mr. McDermott. That is the real dilemma here of support en-
forcement and the money issue.

Thank you.

Mr. Santorum. I thank the gentleman for his comments. Just
one further question on visitation. Do you see any Federal role?

Mrs. ScHROEDER. I don't think it is very possible for the Federal
Government to have any role in visitation, to be perfectly honest.
Family law is at the State and local level. That is where it belongs.
That is where they can make the choices about is the child be mo-
lested or not and so forth.

Mr. Santorum. What about interstate enforcement?

Mrs. SCHROEDER. Interstate enforcement — of visitation rights? I
don't have any problem with that, and I think we should be doing
that. I thought you meant the interpretation of all that.

Mr. Santorum. No. I am just saying, is there any role for the
Federal Government in visitation?

Mrs. ScHROEDER. I think we should be working for obviously uni-
form laws and family law across the border with respect to each
court, each State, according to the other State court's orders.

Mr. Santorum. So something similar to the proposal you put for-
ward that laws for States would be proposed for visitation rights?

Mrs. ScHROEDER. Absolutely. You should be able to enforce those
over interstate lines.

Mr. Santorum. Thank you, Mr. Chairman.

Chairman Ford. Mr. Camp.

Mr. Camp. Thank you, Mr. Chairman.

As a former family law practitioner myself — this hearing is sort
of like family law practitioners anonymous — I have often witnessed
the children being caught in a tug of war between the parents.

Is it your point that the debt snould simply be not dischargeable
in bankruptcy at all?

Mrs. ScHROEDER. You got it. Absolutely. I really think when you
undertake parenthood, there is no way you should be able to dis-
lodge this through Federal law, bankruptcy law, or anything else.
You are a parent, and it is a heavy responsibility. But bankruptcy
laws are being used very creatively all across the board. But I
think to allow it to discharge your family's support responsibilities
is just outrageous.

Mr. Camp. I also agree with your comments that in terms of de-
termining custody and joint legal custody and visitation, those is-
sues are best made where the caseworkers are hopefully visiting
the home and meeting with the parents. And I think that really
lends itself to a State and local approach there. But I appreciate
your comments.

Mrs. ScHROEDER. Thank you very much.

Mr. Camp. Thank you, Mr. Chairman.

Chairman Ford. Mr. Kopetski.

Mr. Kopetski. Thank you, Mr. Chairman.

I was chair of the judiciary subcommittee back home when we
did the 1984 amendments, and I had a bill in, because I had a con-
stituent that had this problem, which related to the mentally
handicapped or developmentally disabled people. In Oregon we ex-
tended forever, for the life of the child, the support obligation be-
cause we saw that the custodial parent, there is no magic to turn-
ing 18 or 21 in this area. Often these individuals are living with
their parents until they are 50 or 60, until their parent dies.

How common is that kind of law? I see that you have a section
of your proposal addressing this nationally.

Mrs. ScHROEDER. It isn t as common as we had hoped for it to
be. We ran into the same thing on the age of 18. If a young person
goes to college or — the expenses of precollege look pretty cheap by
comparison. Unfortunately, not many States have moved to extend
it beyond 18, either.

So that troubles me as exactly where we should go on that. But
I would hope both of those things we could make uniform, if at all
possible.

Mr. KoPETSKi. Could I also ask you, following up on Mr. Camp's
question on bankruptcy, does your provision on bankruptcy allow
a restructuring of that back payment?

Mrs. ScHROEDER. I have found, and I may be wrong, Mr. Camp
probably practiced a little more currently than I have, but most
courts obviously continue to hold that jurisdiction, and whenever
there is a changed circumstance, the parties can go into court, and
I think every State in the Union, correct me if I am wrong, can
plead their case and it can be lowered temporarily. The courts have
been very good about this.

If there are some States that don't, let me know. But most of
them have been fairly flexible if there is a real issue. But to allow
you to say, "Oh, things got bad, let's take bankruptcy and drop the
whole thing and cut it off," I don't think we want to do that.

Mr. KoPETSKi. I understand that, but my question goes to, as the
debt accumulates, let's say it is $20,000 or $30,000, which isn't
hard to do, does your bill suggest the restructuring of that arrear-
age?

Mrs. ScHROEDER. No.

Mr. KOPETSKI. Or that would continue as well?

Mrs. ScHROEDER. I would like the arrearage to continue, too. We
really shouldn't have statute of limitations on that.

Mr. KoPETSKi. I saw that part as well. I was going to question
you on that.

Mrs. ScHROEDER. I feel very strongly that, again, we don't want
some legalism out there that people can use to get rid of this.

It really is an obligation, and it is an obligation that I think
every parent would try to make. We understand there could be ex-
tenuating circumstances, but there is a court that is most familiar
with it, that retains jurisdiction, unlike so many other things, and
let that court decide that rather than federalize it.

Mr. KOPETSKI. I guess I have to think this through. It seems to
me that if you had a parent that — a noncustodial parent who
stopped paying after a year or two, and went away for 5 to 10
years, and then felt bad, came back, tried to reestablish a relation-

ship there, that if it builds up so high, it might be a deterrent for
that.

Mrs. ScHROEDER. But you could go back into the court and try
to work something out, or try and work something out in that man-
ner. It is not like there isn't any agency left that has any jurisdic-
tion. But I think you also don't want to encourage that as a way
to get out of it for a while.

Mr. KOPETSKI. I need to think through and read through some
of these arguments on the statute of limitation issue. The last one,
Mr. Chairman, if I might, has to do with an expedited process for
change of circumstances, especially where the noncustodial parent
has to pay, and suddenly becomes unemployed, and is, whether it
is aerospace or timber workers, et cetera, we are looking at long-
term unemployment changes in this country.

It is my experience that these people are unemployed. They have
to go hire an attorney to get into court to make this change. It is
my understanding, and, you know, there is time involved and, of
course, all this time is going on for the court docket systems. The
arrearage amount is building. And has there been thought given to
an expedited process for these kinds of circumstances?

Mrs. ScHROEDER. I think that best belongs at the State level for
that. I mean, I would hope any State legislature would be mindful
of that situation and would try to make their courts much more
user friendly, and also have the expertise in their courts. I know
many of the courts you don't have to go get a lawyer, you can rep-
resent yourself in that situation, because basically what do you
have, you have your W-2 statements, your unemployment state-
ments. Judges aren't stupid. What else do you need? Everything
else has been tried.

So that becomes a very easy issue for them to look at. But I
think that belongs at the local level, and maybe

Mr. KOPETSKI. I am not so sure, because if we do it at the Fed-
eral level, direct payment schedules.

Mrs. SCHROEDER. Obviously that could be worked out for model
Federal uniform legislation to try and move the States toward. But
I think that that is the way that you would want to move it as you
see more turbulence in the work force, yes, you should be allowing
more flexibility in your family court system, should people get
caught in that turbulence.

Mr. KOPETSKI. Thank you.

Thank you, Mr. Chairman.

Chairman FoRD. Thank you.

One final question, Mrs. Schroeder. Under the current law, it
says that a child support obligation assigned to the State as a con-
dition of AFDC eligibility is not dischargeable in bankruptcy. Does
your bill go beyond saying it is not dischargeable after bankruptcy?

Mrs. ScHROEDER. I am not quite sure I understand your ques-
tion. I think you are saying currently it says you can't

Chairman Ford. If you go through the court system.

Mrs. Schroeder. But you can people can get rid of back ar-
rearages, they can get rid of all sorts of other obligations through
bankruptcy, is my understanding.

Chairman Ford. Which you would apply to all child support
cases?

Mrs. SCHROEDER. You bet. Absolutely.

I mean, see, that is where I think we have made a mistake. For
some reason. States have read what we have said here is that we
are only concerned about child support vis-a-vis AFDC. And I don't
think there is a person on this panel or a person in this room that
feels that way. I think we are concerned about all child support,
period.

Chairman Ford. Because all cases don't ^o to the court.

Mrs. ScHROEDER. Exactly. And I just thmk it is very important
that whatever we do this time, we communicate to the States that
they are not just going to go try to find child support vis-a-vis
AFDC. They are going to get all child support across the board.

And I think the same with the bankruptcy. You don't just protect
it on the one. You protect all child support.

Chairman Ford. So it would not be discharged?

Mrs. ScHROEDER. You Cannot discharge absolutely.

Chairman Ford. Thank you very much, Mrs. Schroeder.

I think that is the last member.

Thank you very much.

I would like to congratulate the next witness for being confirmed
as the Assistant Secretary for Planning and Evaluation.

We are very delighted to have you before the subcommittee. We
look forward to working with you in the months and years ahead.
You have given a clear direction, not only in your writings, but as
a spokesperson for children in this country, in areas of public as-
sistance, and in areas of work programs. We are very delighted to
have you.

As chairman of this subcommittee, I certainly look forward to
working with you over the coming months on welfare reform, child
support enforcement, and many, many other issues which will fall
within the jurisdiction of this subcommittee. I am delighted to have
you, and I speak on behalf of the other members of this subcommit-
tee.

STATEMEP^ OF HON. DAVID T. ELLWOOD, PH.D., ASSISTANT
SECRETARY FOR PLANNING AND EVALUATION, U.S. DEPART-
MENT OF HEALTH AND HUMAN SERVICES

Mr. Ellwood. Thank you very much, Mr. Chairman.

I, too, am really quite delighted to be here. Of course, I had the
opportunity as a private citizen to speak often in front of this sub-
committee, and now I am very excited to be a part of this adminis-
tration.

With your permission and the other members' of the committee,
I would like to ask that my written testimony be submitted into
the record and I will simply summarize that.

Chairman Ford. Your written testimony will be made a part of
the record and you mav summarize.

Mr. Ellwood. Thank you very much.

Child support is an absolutely critical and essential issue as we
have heard from the Members of Congress. This committee has
been in the forefront in really trying to reform our child support
enforcement system.

Of course, there's a long way to go, and part of what I would like
to talk about today is how far we have to go. I also will talk briefly

about the fact that we do see this as a component in a larger strat-
egy that is designed to protect our children and designed to restore
dignity and control to the lives of low-income and middle-income
people around this country.

The President has been very clear on the elements that he sees
in the welfare reform package. First, to make work pay so that
when people go to work, they are not poor, they can adequately
support their family.

Second, to drastically improve the child support enforcement sys-
tem, and that is what I am spending most of my time on here
today.

Third, to provide education and training and other services so
that people can realistically support themselves and get off welfare.

And finally, to create a time-limited transitional support system
followed by work.

Now, I would like to concentrate on child support enforcement.
In my testimony, I provide a variety of background information
that I am sure is familiar to most members of this committee about
the dramatic changes in family structure that have been going on
in this country over the last several decades.

We are now at the point where 14.5 million children are in sin-
gle-parent families. But even more dramatic than that, the typical
child bom today will spend time in a single-parent home. And the
poverty rate for children in single-parent homes is 56 percent.

This is not about low income or high income or anything else
overall. It is not about rich and poor. It is not about white versus
nonwhite. It is about our children. It is a middle-class problem as
well as a working-class problem, and all the groups in between.

One other disturbing trend in these figures is that divorces have
really leveled off. The number of children becoming part of single-
parent families through divorce has remained unchanged for about
the last decade. What is continuing to skyrocket is the number of
children born out of wedlock. We have had very dramatic increases
over the last decade.

Having said all that, where do we find single parents in this
country? We often find them in a nearly impossible position, largely
because one parent is expected to do the jobs of two. We ask our
single parents to be super moms, to both nurture and provide for
our children. A large part of the problem is that noncustodial par-
ents, commonly fathers but sometimes mothers, typically provide
no child support payments.

The median child in a single-parent family in a year receives no
child support at all. Only one-third receive any, and the average
amount is very, very small. It is not surprising under those cir-
cumstances that poverty rates are so very, very high.

I would like to say a couple of words about the history of the
child support enforcement system, because I think understanding
that history is actually quite important in understanding why we
are where we are and why the system has both its complexities
and some of its peculiarities.

Child support enforcement was always treated, until very re-
cently, as a private matter between two parties who are engaged
in a difficult problem. So as a result we used the private court sys-

tern and we used private enforcement mechanisms as best we
could.

Paternity, or fathering a child out of wedlock, was a criminal of-
fense in most cases, and therefore we needed criminal statutes and
criminal protections to keep people from getting stuck in a court
system. And, of course, at the time, there was very little technology
for determining paternity through scientific means, and so it was
his word against hers. So we needed an elaborate adjudicative sys-
tem to see who seemed to be telling the truth and what was the
likely outcome. The role of government in these things was pri-
marily to try to collect monev from people where we were paying
money out in the form of child welfare or AFDC.

So the government got into this system primarily because it was
paying out dollars to low-income kids. It wasn't about the right and
wrong. It was about trying to get our money back. I think fun-
damentally those propositions now have changed and we need to
move forward.

Let me say a little bit about where the current child support en-
forcement system stands. Before I do so, though, I would really like
to emphasize one point. Coming into this administration, going
around the country, talking to child support enforcement officers
around the country, I have really been struck by the high caliber
of people I see throughout the child support enforcement system.
They are doing their best, often under very, very difficult cir-
cumstances, and in some cases under circumstances where very
few of the States seem to care about it, or in others, where there
is a lot of State pressure and a lot of concern.

None of my remarks should be interpreted as doing anything
other than being supportive of the people in the street trying to
make things work.

Similarly, with fathers, many, many fathers pay child support
not because it is required, not because it is forced on them, but be-
cause it is the right thing, because they believe and they count on
their children in spite of enormous frustrations. They, too, I think
deserve our praise and our congratulations.

Having said all that, let's take a look at the current state of child
support enforcement. There are roughly 10 million women who are
potentially eligible for child support. I have a chart over here. It
is also reproduced as table 3-B in my written testimony. But I
think it can give you some sense of what the problem is.

Of the women who are potentially eligible — we are looking at the
women who are not living with the fatner of at least one of their
children — how many of them are receiving awards and the like?
You will see on the blue pie chart that 42 percent have no awards
at all. Another, smaller fraction have awards, but they weren't due
yet in 1989 because they are new cases. This lighter blue shows
that 12 percent were awarded support and received nothing. An-
other group was awarded something but received less than the full
amount.

When the dust settles, iust over a quarter, 26 percent of all
women potentially eligible for some sort of child support award, re-
ceive an award and receive the full amount.

No private business could survive on something like this. No con-
scionable society, I think, can ultimately survive in this situation.

Single mothers are receiving very little, and as a result, our chil-
dren are at grave risk.

Remember, this is the typical child bom in the United States
today.

Now, let me talk briefly also about how the situation varies by
type of family. This is particularly relevant given the changing na-
ture of single parents and families in our country.

This is a chart that shows by different type of family situation
whether there is an award in place, that is tne blue, and what frac-
tion would actually receive some money from the absent parent.
The married column is probably better called remarried. That is
the situation where people typically were divorced and have gotten
remarried.

You can see in cases of married and divorced, close to 80 percent
at least have an award, although only half actually receive money.
By contrast, when we go all the way over to the never married
group, this group that is growing so dramatically, only 24 percent
actually have an award and only 15 percent get any money. The
average amount for those lucky 15 percent is $1,800 or $1,900.

Clearly a critical thing we have to look at is, in all those levels,
getting them close to 100 percent. But it is a particularly disturb-
ing trend for the never marrieds.

Now, we clearly have to redesign our child support system. We
have to rethink how we do it. Payment must be seen as inescap-
able. We have to create a sense of responsibility so that all parents
realize the importance of providing adequate support to their chil-
dren.

I ask you, what is the message we are sending? What are the sig-
nals? What are the values we seem to be sending with our child
support enforcement system, when it has this kind of performance?

I think the answer is straightforward. We are saying if you par-
ent a child and leave home, it is not your responsibility anvmore.
We are saying that two parents, when they split apart, if there is
struggle, if there is pain, too bad, the problem and the burden is
often on the mother.

I think it is time we really tried to transform things and move
to a better situation.

One thing vou might ask is, what could we theoretically achieve,
how far coula we really get if we really did it right?

Now this is a chart that shows the potential gap based on some
frankly rather old data because there isn't good recent information.
And indeed I think it understates the situation. But the potential,
if it really were the case that every parent in the system got a rea-
sonable award, is that we'd collect up to $36, close to $40 billion.
Now we are only collecting $11 billion. That is money that is prop-
erly due, that ought to be part of protecting our children, and in
fact it oftentimes is left uncollected.

So let me concentrate very quickly on two or three items that I
think desperately deserve our attention. I have talked about pater-
nity and out-of-wedlock childbearing.

The simple reality is that only about one-third of all our children
born out of wedlock get paternity established right now. We have
made some real progress, but we are in a situation where over 1
million children each year are born out of wedlock and we establish

paternity in only 30 percent of those cases. That is a statement of
an enormous problem. If we don't get paternity established, noth-
ing else can follow. Without paternity we cannot possibly collect
child support.

I think it is important to ask why paternity establishment has
been so low and ineffective. I think there are a number of reasons.
One is there has been enormous growth in out-of-wedlock births,
so even as we have done better at establishing paternity, we have
in fact been trying to catch a very fast moving train. But I think
there are more things than that.

A lot of it has to do with an arcane system that has failed to take
account of the changing realities and what we know. We do know
that a vast majority of fathers are actually present at the birth of
their child. In-hospital programs get very large numbers of people
to agree to paternity at that point. Why? Because fathers often be-
lieve that it is their proper role in connection with the child.

Another basic problem is we generally only go after paternity
establishment cases when someone comes under the welfare sys-
tem. That can often be 2 or 3 years later after the birth of the
child, or maybe not at all. In such circumstances, waiting a couple
years makes it vastly harder to find the father because often the
relationship has broken down at that stage and people are no
longer interested in pursuing it.

One question that often arises that I think this committee ought
to be aware of is: What can absent fathers, especially the never-
married fathers, realistically contribute? After all, many of them
are poor themselves.

This chart shows an age earnings profile of what people earn.
For teen parents it is the dotted line that ends at the very top.
That is the earnings of absent teenage fathers — ^just the teenagers,
now.

If you will notice, it is true, in their teenage years under 18,
their income is typically $2,000 or $3,000. It is not very high. So
it is very true that the moment when they become parents, they
don't have a lot of income.

Look at what happens to that income as they get into their 20s
and even into their 30s. Remember, these are men who had chil-
dren born out wedlock in their teenage years. The income grows
dramatically.

So if we fail to get to them early because they don't have money
as teenagers, we lose all of our chances. And more importantly, the
child loses his or her chance to have some support from that absent
parent.

That brings us to a second set of issues: Inadequate awards and
insufficient updating. Here, too, we have made some real progress.
Now all States are expected to use guidelines to determine the
amount of the support obligation. That is a big improvement. I still
think we have some work to do there, but we are very far along.
The question of updating, however, is still mired in huge problems.

If we set an award once for that teenage father and never update
it, we will never collect any money. That is not appropriate. We
also have situations where the fathers' incomes go down, and we
make no adjustment for that situation. Simple fairness requires
that as circumstances change, awards must change.

Too often awards are set at a fixed, nominal amount, not even
adjusted for inflation, and we leave it there for the life of the child.
An award that might have made sense when the child was 1 year
old and the absent parent was fairly young may not make any
sense 10 or 15 years later. In the meantime, once again, children
suffer.

A couple of other points. Enforcement is neither tough enough
nor fast enough. We clearly need to do a far better job of enforcing
the awards once they are in place.

We saw the gaps already in what I showed you. States have
often been very slow to adopt the new techniques that we are find-
ing available out there, automatic wage holding, medical support
awards. The Interstate Commission provided a number of very,
very good and powerful ideas, including reporting of new hires. A
variety of other measures, license checks and so forth, are
possibilites.

I think it is very, very straightforward to say that the system is
broken down and we need to use the new systems that we cur-
rently have and create new ones to make it work.

Let me emphasize, however, when I talk about getting tough, we
have to recognize the millions of fathers that really are doing the
right thing. The point here is not to be angry, it is not to penalize;
it is rather to say that both parents have responsibilities, and we
as government will help make sure those responsibilities are met.

A couple of other points, and then I will open to your questions.
Another major problem is fragmentation. We have a system of child
support that involves all levels of government and involves every
branch of government. We have the Judiciary, the Executive and
the Legislative involved in every single State. We have a Federal
system, a State system, a local system, and county systems. And
not surprisingly, we are getting enormous fragmentation.

Exactly how we remedy that is not entirely clear, but some de-
gree of centralization as recommended by the Interstate Commis-
sion, at least in terms of collecting information and the like, is
clearly essential.

We also have a system that distinguishes far too much between
people on welfare and people not on welfare. This is about people
and children in our society, about right and wrong. Ultimately I
think the distinction needs to be taken away that this is a welfare
or nonwelfare problem.

Finally, we simply have not put enough State and staff resources
into child support enforcement. We had testimony earlier about
1,000 persons per worker. That is no way to run a railroad. If we
are serious about making changes in our child support system, we
are going to have to recognize it is going to require some resources.

That said, however, we also have to recognize that if we have a
dramatically improved child support system, we should also save
money. That is not the reason to do it, though. The reason to do
it is because it is right, because it is what our children deserve.

Let me say one final word about child support enforcement as-
surance which has been talked about a lot. It is certainly an ap-
proach that has received a lot of attention. Those of you who know
my past work know I have talked a lot about it.

A number of States are already trying various parts of this ap-
proach. This administration intends to look seriously at these is-
sues and explore the logic, the cost implications and so on.

I am very gratified by the extent to which members on both sides
of the aisle have shown an interest in exploring and improving our
child support enforcement provisions in all dimensions. I look for-
ward to working closely with you.

We have made real progress over time. The Family Support Act
had many, many important recommendations. The Interstate Com-
mission has dozens of absolutely essential recommendations. I real-
ly believe this is one of those areas where there can be a genuinely
bipartisan effort.

I look forward to working closely with all the members of the
committee.

Thank you.

[The prepared statement and attachments follow:!

STATEMENT BY

DAVID T. ELLWOOD

ASSISTANT SECRETARY FOR

PLANNING AND EVALUATION

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

BEFORE THE

HOUSE COMMITTEE ON WAYS AND MEANS

SUBCOMMITTEE ON HUMAN RESOURCES

JUNE 10, 1993

Good morning, Mr. Chairman and members of the Subcommittee.
Thank you for your invitation to appear before you today. I am
encouraged by the Committee's long-standing interest in improving
the nation's child support system and I look forward to working
with you as we develop the President's welfare reform proposal.

Child support is a critical component in ensuring economic
stability for millions of middle and low-income single-parent
families. However, the current state of the nation's child support
system is poor, at best. While many substantial improvements have
been made in recent years as the result of the 1988 Family Support
Act and the efforts of a number of committed states, we still have
a long way to go.

Child Support Enforcement and Welfare Reform

President Clinton, underlying his pledge to "end welfare as we
know it," has developed a vision for reform which is guided by the
following four principles:

Make Work Pay — People who work should not be poor. They
must get the support they need so they can both work and
adequately support their families. Incentives must be made
available through the economic support system that encourage
families to leave welfare by making work pay.

Dramatically Improve Child Support Enforcement — The message
is simple. Both parents have a responsibility to support
their children. One parent should not have to do the work of
two. However, only one-third of single parents currently
receive any court-ordered support. In his speech before the
National Governor's Association in February, President Clinton
stated that we need to make sure that parents who owe unpaid
child support pay it. This money would cut welfare rolls,
help to lift single parents and their children out of poverty,
and contribute to controlling government expenditures and
reducing the debt.

Provide Education, Training, and Other Services to Help People
Get Off and Stay Off Welfare — To reduce the need for welfare
support, people should have access to basic education and
training necessary to get and hold onto a job. Existing
programs encouraged by the Family Support Act of 1988 need to
be expanded, improved and better coordinated.

Create a Time Limited Transitional Support System Followed by
Work — Combined with the first three elements, assistance
through welfare can be made truly transitional as it was
originally intended. Those who are healthy and able to work
will be expected to move off welfare quickly and those who
cannot find jobs should be provided with them and expected to
support their families.

President Clinton is clearly right in making child support
enforcement a high priority. We are examining a vast array of
options and enforcement techniques to improve the existing system.

I know that the goal of improving child support enforcement is
also a high priority of many members of Congress. A number of
notable bills are currently pending in both the House and the
Senate. We would very much like to work with Congress on
addressing this problem during this next year. I look forward to
working closely with this Subcommittee in particular on this issue.

Background

The last three decades have witnessed an increasing number of
children living in single-parent families. Most of these families
— 86 percent — are headed by women. In fact, as Table I
(attached hereto) shows, 14.5 million children under age 18 lived
in a female-headed family in 1991 — a number which has more than
doubled since 1960. More than half of these children live in
poverty.

Recent estimates now indicate that about half of all children
born in the 1980s will spend some time in a single-parent family.
The numbers are even higher for certain children — at least 80
percent of all African American children and 43 percent of all
Mexican-American children, compared to 36 percent of all white
children will spend at least some time in a single-parent home
before reaching age 16.

While female-headed families are formed either by divorce or
by births to unwed mothers, much of the increase in female-headed
families is due to the unprecedented growth of out-of-wedlock
births during the 1980s. Table II shows the annual additions from
both divorce and unwed births. Currently more than one million
children are born to unwed mothers -- a 64 percent increase from
1980. Of all babies born in the United States, more than one out
of every four births will be to a single mother. Contrary to what
many believe, however, most of these births are not to teen
mothers. The number of births to unmarried teens, age 19 and
younger, was only 360,645 in 1990.

The number of children who become part of a single-parent
family due to divorce has actually fallen over the last decade.
When remarriages are taken into account, the number of children in
single-parent families due to divorce has dropped since the mid-
seventies, a sharp contrast to the growing number of out-of-wedlock
births .

The most disturbing aspect of these trends is that children in
single-parent families are much more likely to be poor. In 1991,
56 percent of children in female-headed families lived in poverty
compared to only 11 percent of children in families with a male
present.

Household characteristics greatly affect the income status of
families. According to the National Commission on Children, three
out of every four children growing up in a single-parent family
will live in poverty at some point during their first 10 years of

life.

The low income status of female-headed families is not
surprising when one parent is expected to do the job of two.
Single parents are expected to fulfill the difficult and dual role
as both nurturer and provider. As Table III a shows, 91 percent of
the fathers in husband-wife families contribute more than $2,500 in
earnings annually and 64 percent have earnings greater than
$20,000. But in female-headed families only 5.5 percent of all
fathers contribute more than $2,500 annually. So the mothers in
many cases are the sole contributors to the income of the family.
A typical single mother only receives a total of $1,070 annually in
child support and alimony. The result is often a life of poverty
for the children in that female-headed family.

The Child Support Enforcement System

Child support enforcement was historically a function solely
of the states. The government's interest in child support was
minimal and chiefly based on a desire to reduce or eliminate the
public burden of supporting the child when the father failed to do
so. Apart, from this desire, however, it was often given a low
priority by the states and the court system. It was not a major
concern of the federal government because of the low percentage of
births to unwed mothers and the low divorce rate and the fact that
little federal support was provided for the children in the cases
that did exist.

As the number of AFDC recipients grew in the 1960s and 1970s,
the desire to collect from the absent parent also grew. Since the
motivation stemmed from the desire to reduce welfare costs while
leaving other cases unregulated, a dual system of support emerged.
One system was for welfare recipients and was compulsory.
Beginning in 1967, Congress took action to push states to collect
support. But it was in 1975 that the federal government began to
seriously influence state laws in the areas of paternity
establishment and child support enforcement. Legislation in 1975
added a new part D to title IV of the Social Security Act which
required the states to establish state offices for child support
enforcement (called IV-D agencies) and implement a child support
enforcement system as a condition of receipt of federal funds for
AFDC. The legislation also created a national Office of Child
Support Enforcement to monitor the states, and provide technical
assistance and funding.

Cases that were not IV-D cases, that is, not welfare cases,
were mostly left in the private sphere. This changed somewhat when
the Child Support Enforcement Amendments of 1984 pushed states to
"offer" IV-D services to non-AFDC parents as well. Perhaps as much
as one half or more of all collections now come through the IV-D
(government) collection system (30 percent of these are AFDC
collections). We don't know for sure because there is no tracking
of cases outside the IV-D system. Still, the focus remains clearly
on welfare recipients and, according to many observers, the present
funding and incentives are heavily weighted towards the AFDC cases,
so that non-AFDC cases get less attention.

For the most part, the system is reactive rather than
proactive. The custodial parent (usually the mother) often has the
burden to secure enforcement. Thus, she has the burden of
initiating enforcement actions when the father fails to pay. In
many cases, especially non-AFDC or non-IV-D cases, nothing is done
until the mother takes action. In non-IV-D cases there is
generally no monitoring of payments at all by the government or
courts. Mothers are not infrequently in an unequal power
relationship and they can be subject to intimidation, threats and
abuse if they assert their right to support. As a result, they
often go without rather than taking the chance of rocking-the-boat .

Child Support Enforcement and the Family Support Act

The Family Support Act in 1988 was clearly a step in the right
direction. It contained a number of significant provisions to
improve child support enforcement. A recognition of the paternity
establishment problem and a focus on measuring paternities
established through the IV-D system has helped. Requiring
guidelines as a rebuttable presumption is generally felt to have
resulted in higher and more equitable awards . Wage withholding is
being increasingly implemented and now constitutes about 50 percent
of the collections within the IV-D system. The requirement that
states have automated systems is a clear step towards a more
efficient system. Some states have already met the 1995 deadline
for automated systems though ten or more states may have serious
difficulties .

In some cases, such as periodic review and adjustment of
support orders and extension of immediate wage withholding to cases
outside the IV-D program, the statutory requirements of the Family
Support Act are not effective until later this year or the
beginning of 1994. When fully implemented, the child support
provisions in the Family Support Act will likely lead to further
increased collections. Yet, we probably can't expect the
improvements to significantly alter the picture of non-payment.
More fundamental change in addressing the problems outlined below
is required.

Through the Family Support Act, Congress also created the U.S.
Commission on Interstate Child Support. Its charge was to report
to Congress on recommendations to improve the interstate
establishment and enforcement of child support awards. In August,
1992 it submitted a 446 page report to Congress, entitled,
"Supporting Our Children: A Blueprint for Reform", detailing 120
recommendations. The majority report took a comprehensive approach
that made recommendations that impact on intrastate cases as well
as interstate cases. The Commission should be commended with
producing an excellent set of recommendations upon which we can
build.

The Current State of Child Support Enforcement

Given the increasing number of children potentially eligible
for child support, more and more families will face a need for
adequate and consistent child support payments from non-custodial
parents. Notwithstanding the significant forward movement achieved
by the Family Support Act and prior legislation, the record of
enforcement can still be greatly improved. While some progress is
being made in terms of gross numbers, we are really only treading
water. As table III b indicates, very few eligible women report
receiving consistent child support payments. Of the 10 million
women potentially eligible for support, 42 percent have no child
support award at all. Only 26 percent had an award in place and
received the full amount they were due, while 12 percent actually
had an award but received nothing. Over half of all women
potentially eligible for a child support award receive no support.
This picture has not substantially changed in recent years.

Child support awards, and support actually received, vary
dramatically by marital status. Among never-married mothers, the
fastest growing segment of the single-parent population, only 24
percent had awards, 15 percent received child support and the
average amount received (of those that received support) was only
$1,888 annually. Divorced women fare much better, but still only
77 percent had an award in place, only 54 percent actually received
support and the average amount received was only $3,322 annually.

The lack of adequate support enforcement means that there is
an immense gap between what is currently due in child support and
what is actually received — 5 billion dollars annually. The
potential gap, if all those eligible received an adequate award
which was updated to reflect the non-custodial parents' current
ability to pay, is estimated to be 25 billion dollars annually.
(See Table V a) .

I want to be clear that I am not critical of people working in
child support enforcement at either the federal or state level.
For the most part, they are highly dedicated people trying to do
the best they can at a very difficult task. The problem is with
the child support enforcement system itself - a system that thwarts
the best efforts of the staff to make progress. In relative terms,
the numbers show that progress has really only been modest. As
table V b shows, total child support collected by the child support
enforcement agencies has risen dramatically, but primarily because
more people are availing themselves of the government collection
service rather than passing the child support privately.

Problems With the Child Support Enforcement System

Improving the child support enforcement system will take more
than slight incremental changes. The problems are imbedded in the
very way we think about the nature of the child support obligation.
Child support must come to be seen as a central element in social
policy, not because it will save welfare dollars, though it will,
but because it is the right thing to do. It is central to a new
concept of government, one where the role of government is to aid
and reinforce the proper efforts of parents to provide for their
children, rather than the government substituting for them. Child
support is an essential part of a system of supports for single
parents that will enable them to provide for their family's needs
adequately and without relying upon welfare.

We have to rethink the way we do enforcement. Payment of
child support must be seen as inescapable. And we have to create
a new sense of responsibility so that all parents realize the
importance of providing adequate support for children. Changing
the way we think about child support requires that we understand
some of the fundamental problems with the current system.

Lack of Paternity Establishment

There are over one million children born to unwed mothers in
this country every year and yet we are only establishing paternity
for about 30 percent of them. In the past this was because
paternity establishment was a low priority. Recently, however, we
have begun to pay more attention. The Family Support Act in 1988
set paternity establishment rates for states . As a result of the
increased attention, they are establishing more paternities. In
1991 the child support system established 479,066 paternities, up
from 269,161 in 1987. Yet, the percentage of paternities
established increased only modestly. (See Table VI)

The rise in unwed births is only part of the reason we still
establish paternity for only about a third of unwed births.
Another major factor is the nature of the current paternity
establishment process, including timing, legal process and
incentives .

One reason that the paternity establishment rate is so low is
that paternity establishment does not generally begin until the
mother applies for welfare. As a condition of receipt of AFDC a
mother has to assign her right to support to the state so that the
state can seek reimbursement for the financial support provided to
the mother. In many instances, however, the child is several years
old or older by the time the mother applies for welfare. Finding
the father is then much harder. Time is of the essence in
establishing paternity so that the longer the delay after the
birth, the less likely it is that paternity will ever be
established.

Evidence strongly suggests that paternity establishment ought
to begin at the birth of the child. That is when the ties between
the mother and father are the closest and there is a real desire to
acknowledge the connection with the father. Research shows that
two thirds of fathers in cases of unwed births actually come to the
hospital at birth and a large percentage of fathers and mothers in
these cases feel it is important that the fathers' name appear on
the birth certificate. These ties between the unwed mother and
father often diminish after birth. Contact between the mother and
the father falls off rapidly so that the further removed from the
time of birth the more difficult it is to establish paternity.
Yet, only in a few states, such as Washington and Virginia, is any
effort made to establish paternity at birth.

One question people often ask is whether it does any good to
establish more paternities when most young fathers are poor
themselves. While it is true that many young fathers have low

income, a surprising percentage can contribute something towards
the support of their child. Most importantly, recent research has
shown that young fathers' incomes generally increase after the
birth of the child so that in a few years their incomes nearly
match that of other fathers. Table VII shows this increasing
ability to contribute to support. It is important to establish
paternity quickly and to set some support obligation, even if
initially it is a small amount, so fathers realize they have a
responsibility for the child that begins at birth. Then the child
support obligation can be increased when the father's income
increases. Concern about poor fathers should be directed towards
helping them increase their earnings, not to escape their
obligations to their children.

Another problem is that paternity establishment laws and
procedures are deeply rooted in archaic laws that have not kept up
with changes in genetic testing technology. With current
technology it is possible to either exclude the alleged father or
test to a level of 99 percent or higher in virtually every case.
The deliberative aspects of paternity establishment are now
minimal, yet the procedures to establish paternity have not kept
pace. In many cases, several court hearings are necessary even for
simple paternity cases. These problems, combined with poor
incentives for the mothers and agencies to seek paternity
establishment, means that too many fathers escape their
obligations .

We would like to congratulate the Committee for their fine
work to include in reconciliation a provision making the first
steps in improving paternity.

Inadequate Awards/Insufficient Updating

Child support awards are often inadequate. In most states
until very recently, the amount of the child support award set was
largely discretionary with each judge. Now every state uses
guidelines to determine the amount of the child support obligation.
This is a big improvement, but we need to continue to assess the
adequacy of the present guidelines which vary from state to state.
The major problem, however, is the failure of awards to be updated
to reflect changed circumstances. Guidelines are used to determine
a "fair" amount of support at the time that the support is set,
based, in large part, upon the non-custodial parent's income at the
time. Circumstances of the parents and child change over time,
however. The non-custodial parents' income typically increases
after the award is set and inflation also reduces the value of
awards. Yet, many awards are never increased once they are set.

Periodic updating of child support awards would generally
increase awards so that they reflect the current ability of the
non-custodial parent to contribute to the support of their child.
In most cases this means much more support becomes available for
the child, but where the non-custodial parent's income has
declined, the award needs to be adjusted downwards. Updating would
increase the integrity and fairness of the system. Non-custodial
parents would not be faced with obligations they cannot pay, and
there would be less enforcement problems because less people would
be in arrears .

The Family Support Act addressed the issue of updating awards
through a requirement that beginning in October, 1993 all orders
must be updated every three years for AFDC cases and at the request
of the parties in non-AFDC cases. This was a good start at
addressing the problem although it falls short in two regards.
First, it did not deal with the issue of how states are going to
implement the requirement given court-based systems that will have
difficulty handling the volume of cases. Complying with this
requirement may be troublesome for some states unless they
dramatically change their procedures for updating and move to more
streamlined, administrative systems. Second, non-AFDC parents will

have to "request" review. This puts the burden on the custodial
parent, usually the mother, to initiate the review process. Many
simply go without an increase because of fear of upsetting the
other parent or because the present process is so adversarial.

Enforcement is Not Tough Enough or Fast Enough

Enforcement of child support obligations is often totally
lacking or inadequate. This leads to a perception that the system
can be beat. There are a number of reasons why enforcement is
weak: States are often slow to adopt or use necessary enforcement
procedures and techniques . Automated systems are only being slowly
adopted. There is poor medical support enforcement. Wage
withholding is not fully used and it is often not instituted
immediately at time of hire.

There are a myriad of ways that the system can eliminate
loopholes and get tough so that payment of support becomes as
inescapable as death and taxes . These range from increased use of
liens and reporting to credit bureaus to publishing lists of the
ten most wanted for child support. A system of reporting of new
hires, which has been tried successfully in the state of
Washington, could be used to start wage withholding at the first
paycheck. We need to implement many such changes in order to
change the perception of the system.

Let me say a word about this business of getting tough,
however. We should also recognize and commend the fact that
millions of non-custodial parents do pay their child support
obligations regularly. The focus should be positive wherever
possible. We need to stress the fact that the child support is
ultimately to improve the lives of children. It does little good
to label all non-custodial parents as "deadbeat dads". And
children need the love and caring of the non-custodial parent as
well as the financial support, so we should also work towards
improving child visitation and amiable relationships of parents.

Fragmentation

The present child support enforcement system involves every
level and branch of government. It involves fifty separate state
systems for paternity establishment, setting awards and collection.
Each state has its own unique laws and procedures. Since thirty
percent of the cases are interstate cases, enforcement across state
lines poses severe collection problems.

There is a further lack of centralization at the state level
and some programs are county based. Payment, collection and
disbursement is rarely centralized. Cases are treated differently
depending upon whether they are IV-D cases or non-IV-D, AFDC cases
or non-AFDC . Because of the present incentive system, non-AFDC
cases often receive second-class treatment. As a result, many
women do not enter the IV-D system at all and either go without or
handle the matter privately.

Over-reliance on an overburdened court system also means that
many of the establishment and enforcement steps are slow and
inefficient. A very few states, such as Michigan, have a court-
based system that has, in the past, done a good job in enforcement.
But, many of these court-based systems have long delays and are
inefficiently run. Most are ill equipped by their nature to deal
with the expanding volume of cases. Table VIII shows the steps
necessary to just establish a support order in a paternity case in
a court-based system. Clearly, the complexity involved is
enormous. States that use administrative processes, such as Oregon
and Washington, feel that the process makes their collection
efforts much more efficient than a court-based system. Many IV-D
agency directors reportedly would prefer a similar simple
administrative process or expanded administrative procedures.

Lack of State Staff and Resources

Child support enforcement agencies and custodial parents
seeking help in getting their support both cite the lack of staff
and resources as a major reason why service is so poor. The lack
of staff and resources is blamed, in part, on the fiscal problems
of states. But, under the present federal-state funding
arrangement, virtually every state makes a profit on child support
enforcement. The contributing problem seems to be that states
often look toward the immediate year's impact on the budget rather
than investing in improving the program which would pay dividends
in the long term. It is essential that we find a means to ensure
that enforcement agencies have adequate staff and resources to
provide the necessary level of service.

Child Support Enforcement and Insurance

One approach that has begun to receive more and more attention
is Child Support Enforcement and Insurance (or Child Support
Assurance, as it is also called) .

The program has received much attention from members of
Congress, academics, and many advocacy groups. A number of states
are very interested in trying such an approach. However, this is
an area that needs more study and careful analysis and has
significant cost implications. The President has not taken a
position on this subject. As part of the welfare reform effort, we
will be taking a careful look at this idea as well as many other
possibilities. I look forward to working closely with Congress and,
in particular, this Subcommittee as we proceed.

Thank you Mr. Chairman and members of the Subcommittee.

Table I

Children in Female-Headed Families

"All Related" and "In Poverty"

12-

10-

14.5

All related children under 18 In
female-headed families

--"^^

6.0

-.^"

^^^^

Related children under 18 In
female-headed families In poverty

4.1

60 65 70 75 80 85

Years

U.S. Buieau or the Census, Current Population Reports, series P-60. No. 181 and earlier reports.

There is a large and increasing number of children in
female-headed families

A substantial proportion of the children in female-headed
families is poor

Table II

Gross Additions to Children in Mother-Only

Families

Annual Additions from Unwed Childbearing and Divorce
Net of Remarriage

1.2

1.0-

0.8

■2 0.6

0.4

0.2

/■

Gross number of children ^"
added by divorces ♦

^•^.

Unwed births to women ^
18 years and over^'

Estimated net number of children
added by divorces - remarriages

-i — \ — I — I — I — 1 — I — I — I — I — I — I — I — 1 — I — I — I — I — 1 — ^ — I — I — I — I — I — I I I >"
60 65 70 75 80 85 90

Years

SOURCE: National Center o( Health Statistics, Vital Statistics of the United Stales, annual and Monttily Vital Statistics Repotl.
Vol. 41, No. 9, Supplement, February 25, 1993.

■ Female-headed families are formed by divorce and by birth to
unmarried mothers, but in recent years births to unmarried
mothers have become the major contributor to the growth of
female-headed families

The trend is even more dramatic when remarriage is taken
into account

Table III a
Distribution of Financial Contributions by Fatliers &
IVIothers in Families with Children by Type of Family

In Some Cases, The Husband, Wife, or Fennale-Head Will Not
Be the Biological Parent of the Children

Contribution

Father's earnings

In tiusband-wlfe

families

Ctilld support

and alimony In Motfier's earnings

female-headed In husband -wife

families families

Mother's earnings

In female-headed

families

None

• 5.3%

65.4%

30.1%

31.4%

$1 - $2,499

1.9%

21,0%

11.2%

8.9%

$2,500 - $4,999

1.9% .

8.0% ^

7.4%

5.5%

$5,000 - $9,999

5.8%

3.8%

14.2%

11.5%

$10,000 - $14,999

10.1%

1.0%

12.9%

13.1%

$15,000 - $19,999

11.1%

> 91.1%

0.3%

^5-5% 9.7./,

10.3%

$20,000 - $24,999

12.5%

0.2%

6.4%

7.1%

$25,000 Of over

51.5% ^

0.2% ^

8.0%

12.2%

Total

100.0%

Overall average

$27,983

$1,070

$8,696

$10,452

A primary reason for the low income status of female-
headed families is that income is coming basically from
only one parent

Table III b

Award and Recipiency Rates of Women

No support

awarded

42%

Awarded and

not due in 1989

Awarded and

received full amount

26%

Awarded and

received less

than full annount

12%

Awarded and

received nottiing

12%

10 million women in 1989 lived witti ctiildren and ttie fattier was not present

SOURCE: U.S. Buraau ol the Census, Currenl Populallon RspoMs, sedas P-60, No. 173

Of the 10 million women theoretically eligible for child support

■ 42% had no award

■ Only 26% had aa award in place and received the
full amount due

Table IV

Child Support Payments Awarded and
Received by Marital Status

100'

Awarded
Received

Married

Divorced

Separated Never Married

Women 15 years and older with own children under 21 years ol age present from absent fathers as of spring 1990
SOURCE: U.S. Bureau of the Census, Current Population Reports, series P-60, No. 173

Child support awards and amounts received vary dramatically
by marital status

Among never married mothers, the fastest growing segment
of the single parent population, only 24% had awards, 15%
received support and the average amount received was only
$1,888

Table V a

The Collection Gap

Potential

Currently Due

• 1983 estimate adjusted by CPIU

SOURCE: U.S. Bureau of tlie Census, Cutnnl Population Repotts. jedes P-60, No. 173

Received

The potential for increased child support is very large

Table V b

Total Distributed Collections

Total & IV-D Collections (1989 dollars)

= 6

interpolated
CPS data

■ ■ a » ♦

,♦* Total collections per
' CPS data

Total IV-D collections

1978 1980 1982 1984 1986 1988 1990 1992

preL

SOURCE: U.S. Bureau of the Census, CunenI Population Repotis, series P-60, No. 173.

Child support is collected both inside and outside the IV-D system

Total child support collections have risen, but only modestly in the
last tew years

Child support collections through the IV-D system have risen
dramatically, but that appears to result mostly from a movement
of non-AFDC cases into the system

Table VI

Unwed Births & Paternities Established

O-l-r

-40

— 1 1 1 1 1 1

1984 1986 1988 1990

1978 1980

1982

SOURCE: National Cantet foi Haallh Slallsllcs, Vllal Slatlslics of Iha Unil»il Slam, annual and MonlNy Vital Slallslles Raporl. Vol 40.
No. 8, Supplamont, December 12. 1991; Committee on Ways and Me»n$. Ovetvlew ol Entitlement Piograms. 1992 Gtean Book.

■ A major problem in child support is tlie establishment of
paternity in cases of births to unmarried mothers

■ Currently, paternity is established for only about a third of
unmarried births; the percentage has risen only modestly
in the last few years

Table

Age-Earnings Profile for Teen Fathers

10-

= 6

Absent teenage fattiers >• ^

■< Present teenage fathers

SOURCE: Maureen A. Plrog-Good, 'Teen Fathers and the Child Support Enforcement System" (1992)

The child support system has historically paid little attention
to unnnarried fathers, especially teen fathers, because current
earnings are so low

Over tinne, however, even teen fathers develop the earning
capacity to make contributions

Table VIII

Establish Support Order

Paternity

i>-{EHE)

Chairman Ford. Thank you.

I, too, agree with you. I think we can work closely together and
report a bipartisan bill.

One of the questions I would like to start off by putting before
you is in talking about what Mr. Grandy mentioned earlier, and I
guess Ms. Kennelly has talked about the child support enforcement
system, and legislation moving out of this subcommittee. Is it pos-
sible, do you think, from the administrative perspective, to move
welfare reform and child support enforcement out of this sub-
committee?

Mr. Ellwood. I sure hope so. I think your leadership in this re-
gard is very important. I think the notion that child support en-
forcement is unrelated to welfare or unconnected to welfare reform
is in fact contradicted by the facts we see all around us.

Remember, the child support enforcement system, the IV-D sys-
tem is managed in most places by the welfare department. It is
fundamentally and inextricably tied to the welfare system. That is
one of the problems. It is one of the things we need to change.

Furthermore, as we begin to change the nature of the welfare
system, we need to be sure that the child support enforcement sys-
tem is in place, works effectively, and can be a greater source of
support for single parents.

I think in the Family Support Act, these two did move together.
I think part of what we need to do is think about our children,
think about the pieces that are necessary that change a welfare
system, that many people find quite dissatisfactory, and instead
find a new set of procedures — making work pay, child support en-
forcement, training and transitional welfare, that really will pro-
vide a genuine alternative to the welfare system.

Without an alternative to the welfare system, welfare reform will
be much more difficult and harder to understand. It is as a com-
bination that they make sense. That is not to say that we would
not like to work very closely and very hard with members of the
committee to work on each of these separate elements. But ulti-
mately they must work together.

For too long we have had a fragmented system of trying this, try-
ing that, not recognizing these things are really interconnected.
Our goal in this administration is to make those connections work
more effectively.

Chairman FoRD. The urgency of moving this bill coupled with
the fact that welfare reform will be forthcoming from the adminis-
tration, I want a bipartisan bill to be reported from this committee
and we certainly would like to have one soon. But I certainly don't
want to put welfare reform on the back burner and say we can
move a welfare reform package next year and this is the time we
want to move child support enforcement. I want to make sure I am
getting the appropriate signals from the administration.

Mr. Ellwood. That is exactly the signal we are trying to send.
We believe this is interconnected in many different ways. Welfare
reform is not on the back burner. We want very much

Chairman Ford. We are going to have two separate bills, we un-
derstand, like we did in 1987 and 1988, but I don't think we ought
to focus all of the attention on child support enforcement without

knowing that there is a welfare reform bill that we ought to move
from this subcommittee as well.

Mr. Ellwood. I certainly agree with you, Mr. Chairman.

Chairman Ford. Thank you.

One other thing. Later today a witness will testify that Federal
and State outlays on the child support system now exceed the col-
lections, and that that has been true for some 3 years, I think
1989, 1990 and 1991.

Is that statement true, first. Dr. Ellwood?

Mr. Ellwood. No, I heard of that statement and I can't quite un-
derstand it. If you will look at the chart I showed you earlier, the
total collection chart, which was table 5-A, our collections are in
the range of $11.2 billion. The total amount of expenditures in the
Federal and State system, as I understand it, are in the range of
about $2 billion.

So I am quite unclear about what the nature of that assertion
is, and unfortunately I can't say more than that, except to say that
it is certainly not remotely close to true.

By the way, this is also an example where, because we have such
a fragmented system, because we have a lack of simple and uni-
form procedures in many States, we probably are spending more on
administration than we should per dollar that we collect. Part of
going to a much more dramatically improved system ought to be
that we can work smarter as well as collect more money.

Chairman Ford. Let me ask you, is there a task force within
Health and Human Services that will be making all of the rec-
ommendations in this child support enforcement area?

Mr. Ellwood. We hope to be soon announcing a working group
or set of activities throughout the administration that is going to
be working on these issues. The President has been clear and oth-
ers hope to have a plan and set of activities done by the end of the
year. So I hope soon that we can announce a set of activities that
is ongoing. In the meantime, there is a lot work going on on an in-
formal basis throughout the administration to look at these issues.

Chairman Ford. One final question. Are you going to submit the
proposals on welfare reform and child support enforcement at the
same time, or will one come before the other?

Mr. Ellwood. Our general expectation at this stage is that they
will come together.

Chairman Ford. Are we still looking at target dates of — I don't
want to put you on the spot — September, October?

Mr. Ellwood. I cannot at this time — the President will have to
commit to whatever the timing is. Obviously we have to be cog-
nizant of the many other things that are on the agenda. Right now
it is the budget. We have health reform coming through. But we
are deeply committed to moving forward with this this year.

Chairman Ford. I understand. I am certainly not trying to put
you on the spot. But in regard to child support enforcement, will
we have anything prior to welfare reform?

Mr. Ellwood. Again, our goal is that we move these together.
There is no reason we can't do lots of work, work together on bills,
all those sorts of things, but we do see them as a combination, a
package, that needs to understand and reinforce each other as op-
posed to be seen as separate.

72-449 - 93 - 3

Chairman Ford. In your written testimony you talked about the
four main components of the child support enforcement and welfare
reform: make work pay, drastically improve child support enforce-
ment, provide training and other services to help recipients get off
and stay off welfare, and create a time-limited transitional enforce-
ment system.

In looking over your testimony last night, Dr. Ellwood, it became
clear that child support enforcement and welfare reform will coin-
cide at some given point, because the two are very much tied to-
gether.

Mr. Ellwood. And we intend to work on them together as part
of the administration. Again, I think the goal is to avoid the kind
of fragmentation, the disconnects, that are currently in a system
that seems to only want to collect child support as part of collecting
money to reduce welfare costs. Increasingly we are moving away
from that, and I think a more comprehensive plan does that.

I should also emphasize there are some elements that are in our
current budget that you have already passed on. We have tried to
improve paternity establishment through in-hospital paternity pro-
grams and some medical support. But the large, the really com-
prehensive changes that are needed in each State to make this sys-
tem work effectively, they need to be thoughtful, they need to be
bold. We need to meet the challenge of our children. I think that
larger set of issues is best done in a more comprehensive way.

Chairman Ford. Thank you very much.

Mr. Santorum.

Mr. Santorum. Thank you, Mr. Chairman.

Just to clarify the numbers discussion, the Federal Government
loses money on child support enforcement. We will be happy to pro-
vide a chart with the supporting information. What these numbers
indicate is that according to the way CBO would score Federal ex-
penditures on child support enforcement the Federal expenditures
exceed the money the Federal Government collects in the system.
Dr. Ellwood, you are counting all collections, most of which go to
the families. I am talking about whether the Government in fact
loses money from it. And the Federal Government does. The States,
from our numbers, actually make money under the system, and the
Federal Government has been losing money.

What the chairman was asking about is that 1989, I believe, was
the first year that the combined State surplus and the Federal defi-
cit was negative. That is the clarification of that point.

Mr. Ellwood. Can I just comment on that? Again, I don't have
the specific figures in front of me, but let me again emphasize why
I think the Government should be involved in this. The Grovern-
ment should be involved in this because it is right, not because it
saves welfare dollars. It is precisely because we have been pre-
occupied with saving welfare dollars that we have done a terrible
job.

When we get into the short term, does it pay off today, we often
decide we are not going to ask absent parents to pay their fair
share. And the signal we send is: We don't care unless you go on
welfare.

Mr. Santorum. I couldn't agree with you more. All I am suggest-
ing is that there might be a better way to construct a system so

the revenue lost to the Federal Government isn't as exaggerated as
it is today.

Mr. Ellwood. I think those issues are definitely worthy of seri-
ous attention.

Mr. Santorum. Just a couple of general questions first. I appre-
ciate your testimony. It was filled with lots of

Mr. Matsui. Will the gentleman yield?

It is my belief that we will take a vote, and this is on the house-
keeping matter, and I believe, Mr. Chairman, you will ask Dr.
Ellwood to come back, or not leave, is that right?

Would the gentleman just allow me to ask one question? Because
I am not going to be able to come back.

Mr. Santorum. Sure.

Mr. Matsui. Dr. Ellwood, there has been speculation that there
is going to be some effort on the Senate side to perhaps bring some
welfare reform proposals in this current reconciliation bill, and also
perhaps some child support enforcement matters in this reconcili-
ation bill.

It is my hope and belief that the administration certainly would
not appreciate that and would oppose that vigorously, both on the
floor of the Senate, but more importantly on the House-Senate con-
ference, should it get in.

Is that the position of the administration at this time, and can
you assure us that you will make every effort to ensure that they
don't put something on the reconciliation bill?

Because we are trying to cooperate on this side of the Congress.
We want to do whatever we can to make a successful administra-
tion and a successful welfare program. But the other body hasn't
shown that kind of discipline.

Will you make some comment? Maybe assure us that we are
going to feel confident tonight when we go to sleep we are not going
to be blind-sided by those folks on the other side who all want to
be President?

Mr. Santorum. Only half of us want to be President.

Mr. Ellwood. I am sorry — or perhaps happy — to say I am not
privy to the negotiations that are ongoing throughout this Con-
gress, both on the House side as well as on the Senate side, to
these kinds of issues.

There is alr-jady, of course, within this bill, a number of things
designed to forv/ard the administration's welfare reform goals. The
dramatic expansion in the earned income tax credit is very impor-
tant, a central part.

Mr. Matsul I don't want to take too much time, but I under-
stand that. Will you just give us some assurance that we will not
have to worry about the Senate going beyond what we have already
done.

Mr. Ellwood. We are certainly not going to see an alternative
to the welfare reform kinds of things — welfare reform is a long
process of which obviously there are some elements already in
place. The major fundamental welfare reform proposals are yet to
come, and will be deeply and closely worked on in this committee.
It will not be done as part of a reconciliation.

Mr. Matsul And will you stick with whatever you propose?

Mr. Ellwood. I don't feel comfortable without knowing all the
specifics talking about that, but the notion here is that welfare
reform is not the primary part of this vehicle. Where there are spe-
cific negotiation issues going on, I just really can't talk about that.

Mr. Matsui. I wasn't asking if you knew of some negotiations
going on. I was asking if any additional welfare reform provisions
were attached, would you oppose them? And would you give us
some assurance that you are not going to

Mr. Ellwood. Unfortunately, until I see it and understand it, if
the notion

Mr. Matsul It is just the point, even if you like it, we won't be
privy to it, then. You see what I mean? This committee won't have
any action because it will be done in a House-Senate conference.
That is what my problem is.

Mr. Ellwood. Again, I apologize that I cannot

Mr. Matsul They are going to do the energy tax over again. We
will have to redo it in the House-Senate conference, OK?

Now, I will tell you, you won't get much cooperation for the rest
of the 2 years if in fact we see a welfare bill or a child support en-
forcement bill come out of that conference or come off the floor with
your approval. I can just assure you that this will make many of
us very unhappy, because that means that the Senate will write
the bill with the administration just as they are doing on the en-
ergy tax now, and we won't have a role in it.

Mr. Ellwood. Congressman, I very much hear you, and I will be
sure and pass on those views in the strongest possible terms that
I can.

Mr. Matsul Thank you.

Mr. Santorum. Thank you, Mr. Chairman.

Again, I was commenting that you provide a lot of information,
and yet you don't have any specific proposals here on child support
enforcement or on welfare reform or anything else. Can we get
some time lines? Maybe Mr. Matsui asked my question. Maybe
your time line is next week. But

Mr. Ellwood. The time line is definitely not next week.

Mr. Santorum. Do you folks have a time line for when you
would put forward child support enforcement/welfare reform or sep-
arate pieces of legislation?

Mr. Ellwood. Our expectation is that we do it by end of the
year. The exact timing we have not made a commitment to, in part
because we have learned from the experience of the first 100 days
that timing is hard to judge. But our expectation is to do it this
year.

Mr. Santorum. To introduce a bill this year?

Mr. Ellwood. We expect to have a detailed plan available and
out by the end of the year. Whether that will be legislation or not,
I simply do not know.

Mr. Santorum. My understanding from Secretary Shalala was
there was going to be some sort of committee or commission, some-
thing like that task force that is going to be formed to look at this.
Is that accurate?

Mr. Ellwood. My expectation is there will be some sort of work-
ing group, and I would hope that would be announced very shortly.

Mr. Santorum. I haven't just missed the article in the paper;
there has been nothing announced as far as that being formed?

Mr. Ellwood. You have not missed any articles, to my knowl-
edge.

Mr. Santorum. And that would be the group based out of her
shop that would be doing that?

Mr. Ellwood. My expectation is this is a Presidential initiative,
it will require the interaction of all the departments or most of the
departments in the Federal Government, including Agriculture,
HUD, Department of Labor, the Justice Department, Treasury. All
of these are — again, part of the problem is we have had this frag-
mented system.

So my expectation is any sort of working group that would be
formed would be throughout the administration. Obviously, HHS
would play a central role in that.

Mr. Santorum. My question is, you have the chairman here tell-
ing you we are ready to roll on welfare reform. As you know, we
introduced H.R. 741 which you probably are familiar with, which
was our attempt to reach out to the administration and say, Mr.
President, we have your bill here, this is the bill you asked for
when you ran for President, this is your time limitation on welfare
and work requirements and transition programs, and we even pro-
vided money, which is not an easy thing for a group of Republicans
to do.

We said, Mr. President, let's go. And you have a chairman of this
subcommittee here in the House who is saying. Let's go, and you
haven't even appointed the working group yet.

Mr. Ellwood. Again, I understand your frustration. I certainly —
needless to say, I, as one who cares deeply on this issue, think it
is critical. On the other hand, I also believe we are talking about
dramatic changes in the current system, things I think are des-
perately needed, but I also believe they are worthy of careful and
thoughtful deliberation.

Mr. Santorum. One of the things that I believe the President
was very, very articulate on during the campaign, and rather spe-
cific, in many instances, was the welfare issue. It seemed to me he
articulated during the campaign that he had a plan. We are 6
months into this administration and haven't even had a discussion
of it within the administration, from what you are telling me.

Mr. Ellwood. We have certainly had discussions

Mr. Santorum. But not putting anything on paper at this point.

Mr. Ellwood. Certainly nothing is on paper. We are trying to
take our time in looking carefully and thoughtfully on it. Some of
these things are sequential, not simultaneous. If we haven't found
a way to make work pay, if we are not moving forward with health
reform, it is much more difficult to provide a genuine alternative
to welfare.

I think it is both logical and appropriate that the administration
not try and do every single item on its agenda at once.

This is very, very central to what the President believes, what
this administration cares about. He says it repeatedly. So our goal
is in fact to move forward, but to have a thoughtful and careful
program that is in concert with the kinds of issues that emerge
from the budget process and everything elimination.

Mr. Santorum. Do you have an opinion on H.R. 741?

Mr. Ellwood. H.R. 741 clearly has very important elements in
it. I think that it is, however, focused only on the fourth of the four
elements that we think are central to the President's plan. The
four elements are making work pay, child support enforcement,
transitional supports in terms of employment training, and then
time-limited transitional welfare.

Mr. Santorum. It addresses two of the four, because we do have
transitional programs in the bill.

Mr. Ellwood. There are also some limits on how much work you
offer for people. One of the critical things the administration is
committed to is making sure people aren't just cut off, they are
given a chance to work. But my goal is

Mr. Santorum. We have work programs in the bill. They are ar-
ticulated in the bill. There is a certainty of work at the end of the
2 years in our bill.

Mr. Ellwood. Again, part of the logic here is to try and provide
a genuine alternative to the welfare system. The goal is not simply
to talk about making welfare time limited.

But I would very much like to work closely with you and other
members of the committee, because I really agree with the senti-
ments that you have offered, that Congressman Grandy — and
again, members of this committee know I have worked very closely
with them in the past. I have worked closely with Republican gov-
ernors as well as Democrat. I think this is an area where we ought
to be able to fmd some common ground, and I really hope that we
can.

Mr. Santorum. We hope so, too.

I have been a bit rigorous here but I do so only because I would
like to see something done to move quickly, as the Chairman has
articulated.

Mr. Chairman, if I could reserve a few more questions before we
break.

Chairman Ford. It will probably be 20 minutes before we get
back, so I didn't want to tie him up that long.

Mr. Santorum. I will just ask them another time.

Chairman Ford. We may submit some questions in writing to
you. We would hope you would respond back.

I would like to announce for the other panelists, there are two
votes. It was not the intent of the Chair to have a break. We were
going to work right through. But I want to recess until 20 minutes
after, giving us a chance to make both votes rather than trying to
come back and having to leave again.

Thank you very much. I certainly hope that within the next few
days we will have an opportunity to sit down and to discuss some
of these matters, and to see where we are, look at a closer time-
table on both child support enforcement as well as welfare reform.

And as Mr. Matsui said earlier, we are going to be looking at
very closely what might transpire on the Senate side. We hope the
administration, if they want to move right away on welfare reform,
will give us a bill right away and we will move it. We certainly
would not want it to be compromised in the Senate tax package.

Again, thank you very much for coming. I look forward again to
working with you.

The committee is going to stand in recess until 12:20. Thank you.

[Recess.]

Chairman Ford. The subcommittee will come to order.

Let me apologize to this next panel and the other panels that
will be appearing. I am sorry to be late coming back into the sub-
committee. We were detained on the House floor.

At this time we will call the Child Support Council, Darryll W.
Grubbs, president; the National Child Support Enforcement Asso-
ciation, Michael R. Henry, director, Division of Child Support En-
forcement; the American Public Welfare Association, Larry D. Jack-
son, chair. National Council of State Human Service Administra-
tors, and Commissioner of the Virginia Department of Social Serv-
ices.

Let me personally welcome the panel for the subcommittee. We
are delighted you nave taken time from your schedules to share
with us your testimony today, which will help enable us to draft
and pass legislation in this child support enforcement system.
Again, thank you very much.

I will recognize the panel in the order in which I have called your
names. I am sorry, the American Bar Association, Marshall J.
Wolf, the chair of the section on family law, partner. Wolf & Akers,
Cleveland, Ohio.

Mr. Grubbs.

STATEMENT OF DARRYLL W. GRUBBS, PRESIDENT, CfflLD
SUPPORT COUNCIL

Mr. Grubbs. Thank you, Mr. Chairman and subcommittee mem-
bers. I am Darryll Grubbs, president of the Child Support Council.
We are a nonprofit association of private child support profes-
sionals and businesses.

One of the goals of our association is to try to encourage some-
thing which you don't hear a lot about today — the involvement of
the private sector in some of the solutions to the child support
problem we are facing. As I listened to the testimony this morning,
it struck me that again the answers seem to focus on: We either
need to turn this over to the IRS or we have got to load more man-
dates on State IV-D programs. I would like to suggest that there
may be other options the subcommittee might want to consider.

I came to the conclusion after working in a IV-D program in
Texas for a number of years that we needed to do something dra-
matically different. No matter what we did in the IV-D program
in the course of 3 or 4 years, during which time our program was
recognized by this subcommittee and the National Child Support
Enforcement Association as the most improved program, including
tripling our staff, doubling our budget, and significantly improving
our system to handle IV-D cases, we nonetheless were no further
ahead at the end of 4 years of growth than we were when we
began.

It was at that point that a number of us in the IV-D agency de-
cided we needed to make some pretty radical changes in Texas or
we weren't going to be able to serve anyone very well. So we start-
ed formulating some recommendations through the Child Support
Council, of which I am the president. We have looked at solutions
based on two assumptions.

One is that the IV-D agencies themselves could not solve this
problem alone; and second, we could not look to the Federal and
State Government totally to fund the solutions to the problems. We
needed to do something differently.

So we set about really to present some new alternatives that
would take into consideration those two initial assumptions.

I do want to mention just very briefly that we certainly commend
the Clinton administration and this subcommittee on the initia-
tives that went through here in the Budget Reconciliation Act. We
also commend the Interstate Commission on Child Support En-
forcement for a great deal of work in trying to identify specific is-
sues that could improve the IV-D program.

However, with all due respect to the Interstate Commission, my
concern is that to implement all of those recommendations, which
would certainly get you a better program, the commitment by the
Federal and State Government to the IV-D program would also
have to increase significantly.

There are 167 recommendations in the Interstate Commission's
report, 80 of which are new mandates on State IV-D agencies. And
instead of adding new mandates to this program, perhaps what
should occur is we should revisit some of the original foundations
of this program, identify the top five, six or seven key objectives of
this program, which would certainly include paternity establish-
ment, and redirect the focus of the IV-D program on those key ob-
jectives.

The second part of that, then, would be to try to encourage the
private sector to play an even greater role in child support enforce-
ment. There are a number of innovative activities going on around
the country. There are some major firms that have decided child
support is an area they want to be involved with. Lockheed, IBM,
and Deloitte Touche, for example, are among the larger companies
now involved in child support enforcement, both through support-
ing IV-D agencies' efforts, as well as providing direct non-IV-D
child support enforcement services.

During the past 10 years, we have basically made IV-D enforce-
ment the only game in town, and the improvement in the IV-D
program over the last few years has come from some very sound
new ideas and concepts. Unfortunately, these ideas were only in
terms of ways to improve the IV-D program.

As a result of that, we have not only eliminated some options for
custodial parents seeking enforcement of their orders, but we have
also overloaded the IV-D system to the point where if there are
any more new mandates the system, I believe, will break down
completely.

The second primary problem facing this program is, as Mr.
Ellwood mentioned, we have failed to timely establish paternities
and set up systems that immediately enforce any delinquent child
support obligation. Those are both activities that do not necessarily
take a massive infusion of Federal and State dollars to implement.

Certainly the IV-D program should continue playing a role in pa-
ternity establishment and enforcement of a great many of all the
cases out there, but there are ways this program can be reinvented
to include the private sector in efforts to enforce child support and

we would like to see those recommendations acted on by this com-
mittee.

I have identified in my written testimony some specific rec-
ommendations. They begin with a prioritization of the objectives of
the IV-D program, and then move into some other recommenda-
tions about how the Congress and State legislatures can look at al-
ternatives to the IV-D program for helping solve the child support
problem.

With that, I will end my testimony.

Thank you very much, Mr. Chairman.

[The prepared statement follows:]

STATEMENT OF DARRYLL W. GRUBBS
CHILD SUPPORT COUNCIL

I am Darryll Grubbs, President of the Child Support Council. Chairman Ford and
members of the Human Resources Subcommittee, it is a pleasure to be here today and to
offer my views and those of the Child Support Council. I appreciate the invitation.

The Child Support Council (CSC) is a non-profit association of private child support
professionals and businesses. Our goal is to encourage a public-private sector partnership to
improve child support establishment and enforcement.

BACKGROUND

My perspectives about the child support enforcement program result from my
experience in child support enforcement that began six years ago. From 1987 through 1991,
I was an Assistant Attorney General in the Child Support Enforcement Division of the Texas
Attorney General's office. As you may know, Texas was, and is still, unique in being one
of only a couple of states to administer its IV-D program through the attorney general, who
in Texas is also an elected official.

As a result of the innovative leadership of the Texas Attorney General's office during
the period from 1987 to 1991, the Texas IV-D program was recognized as the "most-
improved" program by both the National Child Support Enforcement Association (NCSEA)
and this Subcommittee. Since leaving the Attorney General's office early in 1992, I have
established the non-profit Child Support Council and continue working on, writing about, and
promoting solutions to the child support problem.

GOVERNMENT ALONE CANNOT SOLVE THE PROBLEM
OF UNPAID CHILD SUPPORT

As the members of this Subcommittee know, the fact that billions of dollars of child
support goes unpaid each year, and hundreds of thousands of children will never receive
child support because paternity will never be established, is a national tragedy.

One reason I left the IV-D program to establish the Child Support Council was
because I reached the conclusion that the problem of unpaid child support in the United
States could not be solved by the efforts of federal and state IV-D agencies alone. I also
came to recognize that in an era of growing budgetary deficits in Washington, and in almost
every state capital, it was unrealistic to expect the federal and state government to pay the
entire cost of fixing the child support enforcement program.

Accordingly, based upon these two conclusions, the Child Support Council has set out
to develop recommendations to improve child support enforcement without relying
exclusively on IV-D child support enforcement agencies to establish paternity and enforce
support orders for everyone, as the IV-D program essentially is required by law to do today.

Second, we wanted to develop recommendations for an effective national child
support program that would not totally rely on taxpayer dollars, as would some proposals
being considered in Congress today, such as those to totally federalize the Title IV-D child
support enforcement program through placing it within the Internal Revenue Service. 1 will
comment on this proposal a bit later in my remarks.

Before discussing our specific recommendations, I would like to note that I had the
privilege several months ago to appear before this Subcommittee and to present testimony on
President Clinton's child support initiatives and some of the recommendations of the U.S.

Commission on Interstate Child Support. While I do not want to repeat that testimony again,
1 would like to again acknowledge and commend both President Clinton and the members of
the Interstate Commission for their sincere interest in and efforts at solving the tragedy of
unpaid child support. The Interstate Commission and its members, including Senator
Bradley, Congresswomen Kennelly and Roukema, its chairwoman, Meg Haynes with the
American Bar Association, Geraldine Jensen, with the Association of Children for the
Enforcement of Support (ACES), and others, worked very hard. The fact that a majority of
the Commission were able to arrive at consensus on a great many issues as identified in their
report is no small accomplishment. As this Subcommittee has already learned, a consensus
among child support professionals on almost any child support related issue is often a very
difficult and rare occurrence.

Not only was the Commission able to reach a consensus on many issues, but the
recommendations that flowed from the consensus are generally very good ones. In fact, if all
the dozens of recommendations contained in the Interstate Commission's report could be
fully implemented, there is no doubt in my mind that the record of child support
establishment and enforcement would significantly improve.

However, with all due respect to the majority of the Commission's members, I do
share some of the views about the Interstate Commission's report that are articulated by its
dissenting members. Primarily, that the recommendations focus too heavily upon new
mandates for state and local IV-D agencies. The implementation of many of these new
mandates will substantially increase the workloads of state IV-D agencies. That will require
notable increases in staffing and other resources, which of course means more federal and
state funding.

In fairness, implementation of some of the Interstate Commissions recommendations
would likely result in cost savings to federal and state government through recovery of
AFDC and Medicaid dollars. Nonetheless, as I have witnessed first hand from working in a
large IV-D program, and as the Congressional Budget Office has acknowledged in its cost
savings estimates for some of the Commission's proposals, it is extremely difficult to know
with any real degree of accuracy how much money really will be saved once additional
program initiatives are established and operating. This is especially true when dealing with
any added program initiatives for the IV-D agencies, many of which are still continuing to
struggle to implement the mandates resulting from the last batch of federal program
improvement initiatives enacted through the 1988 Family Support Act.

What I had hoped the Interstate Commission would do, and would still like to see
included in the legislation to implement the recommendations of the Commission is a phased-
in implementation of the Commission's recommendations, that would come following a
thorough planning process to target the most important objectives for the IV-D program. By
simply dropping additional mandates on IV-D agencies, without any sense of priority and
importance, will, I fear, quite literally break the back of the IV-D program.

Rather than mandating a laundry list of new requirements and responsibilities to state
IV-D agencies, it may be better simply to identify proposals that appear to work well and
encourage state and local IV-D agencies to adopt them as quickly as they can within their
fiscal and physical capabilities. Already, in fact, that is occurring as states study the
recommendations of the Interstate Commission and voluntarily have begun implementing
some of the Commission's ideas that the states believe will work.

To their credit, the Clinton Administration and this Subcommittee, through your
recent work on the Budget Reconciliation Act, have proposed just a few key changes
focusing one or two key IV-D objectives, notably those intended to increase the paternity
establishment rate and to enhance the ability of state IV-D agencies to enforce health
insurance and medical support requirements.

I would now like to turn to some recommendations of the Child Support Council. In
formulating these recommendations our goal was not just to add new layers to the existing

IV-D enforcement program, but to offer some basic structural alternatives for addressing
some of the systemic problems that have permitted only limited success of the IV-D
program. Addressing these systemic problems will require some bold initiatives, but not
necessarily, new programs and activities that will require more federal spending or more
federal bureaucracies.

TWO FUNDAMENTAL REASONS FOR THE POOR RECORD OF
ESTABLISHMENT AND ENFORCEMENT OF CHH^D SUPPORT

From studies of the child support program, and through discussions with those at the
state and local level who perform child support enforcement activity, the Child Support
Council has identified two basic and fundamental situations that exist in the United States that
must be changed if the child support enforcement problem is to be solved.

The first situation is that, for millions of custodial parents who are owed tens of
billions of dollars in unpaid child support, there are too few effective options available to
them today from which to seek help in establishing or enforcing child support orders.
Certainly, state and local IV-D agencies exist in every state to help almost anyone who
applies (or who is automatically referred because they are receiving AFDC). Unfortunately,
the reality is that this means most custodial parents will wait many months to be served
because so many others are doing the same thing.

There are reasons the IV-D agency has become almost the "only game in town" and
that custodial parents pursue few if any other options. One reason is that government policies
over the past ten years have made the IV-D program the primary source through which most
new legal enforcement tools are available. Another reason is that IV-D enforcement services
are available at no cost (or nominal cost) to everyone, without regard to income or need.

The result is predictable. There are huge volumes of cases facing every IV-D agency.
According to the General Accounting Office, the average IV-D worker has 1,(XX) cases. This
means, as custodial parents know too well, that establishment and enforcement activity by
IV-D agencies on most individual cases leaves a lot to be desired. Where the Child Support
Council differs from some advocacy groups is that we do not believe the tardiness and lack
of thoroughness in the way IV-D cases are worked is because state and local IV-D personnel
are lazy or incompetent. Instead, they are functioning with a siege mentality. They are like
assembly line workers with parts to be assembled coming down the assembly line at a faster
and faster pace. It means they can only afford to devote a very small amount of time to any
given case.

As an example, if a IV-D agency's automated locate process does not result in a good
address to be used to locate an absent parent, that case may be passed over, even though an
address could be obtained through other manual (more labor intensive) locate processes.
Instead, only those cases where an address is obtained using the automated locate process
make it to the next level of enforcement activity. Because of the increasing volume of cases,
and the pressure of complying with federal case processing time frames, IV-D cases must be
moved quickly through the "assembly line" enforcement process. The only exceptions to
this assembly line process are when a IV-D agency may pursue a more rigorous, hands-on,
enforcement effort because there is a significant likelihood of obtaining a support payment
(or an AFDC recovery), or otherwise when a custodial parent becomes a "squeaky" wheel
and writes letters of complaint to legislators and newspapers.

The second undesirable, but basic situation that exists today, is the failure to timely
establish paternities as eariy as possible and to automatically enforce any delinquent support
payment. Under the current system, the fir.st attempt at establishing paternity may not occur
until several years after a child is bom out of wedlock. Likewise, most efforts to enforce a
delinquent child support payment do not begin until the custodial parent initiates a complaint.
According to one study, almost 70% of custodial parents waited more than one year before

taking action and 25% waited more than five years. This situation means that, by the time a
client comes to a IV-D agency (or is referred if she is an AFDC client), she may no longer
know, or have forgotten, important information that could be used to identify or locate an
absent parent.

Especially in non-AFDC cases (which are the majority of IV-D cases today), by
waiting until a custodial parent decides to seek establishment of parentage, or to initiate a
complaint after not receiving child support, effectively guarantees that a substantial number
of paternities will never be established and support never paid.

A TWO-STEP APPROACH TO "REINVENT" CHILD SUPPORT ENFORCEMENT

Step One: Opening the Doors of Enforcement to Non-IV-D Entities

According to the U.S. DHHS Office of Child Support Enforcement, there is an
estimated $23 billion in unpaid support, and the amount grows daily. As child support
advocates often complain, while funding and staffing of state and local IV-D agencies
continues to increase, the percentage of cases in the IV-D program in which collections are
made remains relatively low (17.9%) and, unfortunately, quite constant (increasing from only
15.7% in FY 1986).

Nonetheless, Congressional and state legislative efforts continue to focus on solutions
that provide additional enforcement tools, new staffing and increased funding for the IV-D
program and IV-D agencies. This solution simply has not worked effectively and will not,
by itself, improve child support establishment and enforcement in the future.

By illustration, in Texas, between 1987 and 1991, we successfully worked to increase
funding for the IV-D agency from about $25 million to $100 million. The staff more than
doubled from 600 to almost 1300. And, while performance increased significantly during
this time, the caseload increases in subsequent years (from less than 200,000 to more than
700,000 today) has almost erased earlier program gains.

All around the country, even after obtaining new funding, additional staff and better
enforcement laws, most IV-D agencies merely end up "running in place" because these gains
are offset by the staggering increase in IV-D caseloads and the requirements for providing
additional services to IV-D clients, such as review and modification of support orders. To
illustrate the problem of new federal mandates, while IV-D agencies are still working to
reach the 50 percent threshold for establishing paternities (the June 1991 average was 43
percent), OCSE has recently decided that IV-D agencies must now perform, upon request by
a non-custodial parent, a review and adjustment of a child support order, even when it was
not a IV-D order. Saddling IV-D agencies with such a requirement is nonsensical and only
serves to postpone the attainment of what should be more worthy objectives of establishing
paternity and enforcing support for custodial parents who are not receiving anything at all
from an obligor.

To correct the problems that we have identified. Congress, the Clinton
Administration, and state legislatures, must consider a major new approach to solving the
child support problem.

Specifically, the CSC recommends the following actions:

• First, relating to the existing IV-D program, there should be a special blue-ribbon

advisory committee appointed by the President and top ranking Congressional leaders.
Included on this advisory committee should be representatives from all interested sectors
within the child support community, including state and local IV-D officials, custodial
parents, private sector companies, family law attorneys and others. Their initial and
immediate goal should be a complete review of all current mandates of the IV-D program.
These numerous mandates (including some which even conflict), must be carefully reassessed

and reconsidered in terms current state and local IV-D agencies' present resources and
funding levels. Then a ranking in terms of priority should be established and for which the
IV-D program should focus its primary efforts.

The basic question to be answered is what are the most important goals for the IV-D
program to accomplish in the next year, the following year, and years three through five. As
already mentioned, for example, is obtaining a 75 percent national paternity establishment
rate a more important goal to achieve in three years than doing 50,000 modifications of
orders at the request of non-custodial parents? Next, the advisory committee should redirect
IV-D funding and performance-based audits in a consistent and unified way to encourage that
IV-D programs pursue these priorities. Other current responsibilities of IV-D agencies that
may have merit, but which are not as important as those having top priority, should be
deferred (or redirected to other non-IV-D entities, until Congress is satisfied that the priority
goals of the IV-D program have been achieved.

Under such a plan, there will have to be a "moratorium" of sorts on adding any new
responsibilities to the workload of IV-D agencies until they have achieved their priority
goals.

• Second, in conjunction with the first recommendation above, federal and state
policymakers must stop focusing all efforts to improve child support exclusively on IV-D
agencies. There are other non-IV-D governmental and private resources that are capable of
becoming become part of the overall solution to the child support enforcement problem.

For example, local courts can and do appoint "friends of the court" and "guardians ad
litem" to help in child support enforcement cases. In addition, in some states, including
Texas, there are county funded local domestic relations offices that perform child support
enforcement. These non-IV-D governmental entities do not use nor would they need to use
IV-D funding. Instead, many are funded (or could be) through state and county "user fees"
or "late payment penalties" in which the non-custodial parent pays for the costs of
enforcement.

Additionally, perhaps because there is a more competitive environment than existed
ten years ago, private attorneys are in increasing numbers beginning to pursue child support
enforcement. In fact, there is a network of private child support attorneys who share
information about developments in child support enforcement laws and refer interstate cases
to each other.

Likewise, there are a growing number of private child support collection agencies
offering services. Unfortunately, many of them have little experience in child support
collections and close down as quickly as they opened. However, there are several reputable
private child support collection agencies run and staffed by former IV-D caseworkers, who
are fully capable of performing effective child support establishment and enforcement work
without using federal IV-D dollars.

• Third, again, either through the efforts of an advisory committee or its own
initiatives, Congress and state legislatures should do everything possible to encourage the
participation of non-IV-D governmental entities and private firms as part of a comprehensive
national efforts to establish and collect child support. They can begin by taking a close look
at the legal enforcement tools they have written during the past decade for IV-D agencies and
identify ones that would be appropriate for use by non IV-D governmental entities, private
attorneys and reputable child support collectors.

Again, to illustrate by using Texas, once we decided our IV-D agency was not able to
effectively handle all our cases, we changed state laws to permit local government entities,
court-appointed guardians ad litem and private attorneys to utilize enforcement practices
previously reserved for the IV-D agency.

As a result, today in Texas, these court appointed and other governmental and

private entities are able to use a number of very powerful enforcement tools. One of these
tools is a simplified, administrative wage-withholding process. This enforcement tool,
previously authorized for use only by the IV-D agency, now allows non-IV-D entities to
prepare an administrative writ for wage-withholding (using a form developed by the IV-D
agency) and serve the writ on an employer without need for a court hearing and court
ordered wage withholding. Before 1991, the only way a custodial parent could use this quick
and efficient enforcement tool was to apply to the IV-D agency as a client to the Attorney
General's office or seek a judicial withholding order issued by a court following a full
hearing.

Another tool that is now available to non-IV-D child support enforcers in Texas is one
for enforcement of medical support through mandatory employer health insurance coverage.
This is an important example because the medical support provisions contained in S. 689
(introduced April 1 by Senator Bradley) to implement recommendations of the Interstate
Commission are patterned after this Texas law. As originally written, the Texas law
required an obligor with a medical support order to provide a copy of the order to the IV-D
agency, along with the name and address of his employer and whether health insurance was
available to him through his employer (or his labor union or trade association). The
Attorney General would then send the medical support order to the employer, at which time
the employer would have to enroll the NCP's child in the health insurance plan. Within 30
days of receipt by the employer of the order, the employer notified the IV-D agency that the
child was enrolled.

In 1991, we amended this statute so that not just the Attorney General (i.e. IV-D
agency), but other enforcing entities are also permitted to obtain and serve a medical support
order on an employer and to enforce the employer's compliance through adding the
dependent child to the noncustodial parent's health insurance.

Texas also enacted a "child support lien" law in 1991 to permit a lien to be attached
to property of a delinquent obligor without first obtaining a court issued judgement. Instead,
the law authorizes the IV-D agency, and anyone else enforcing the order on behalf of a child
support claimant, to submit a "child support lien notice" (which simply recites a few verified
facts, including the name of the obligor, the amount of child support arrears and to whom it
is owed) to a county clerk where the obligor's property is located or the obligor resides. The
clerk is required to enter the lien in the county's judgement records and the property cannot
be sold or transferred until the child support lien is extinguished. Again, rather than making
this tool available only for use by the Attorney General in IV-D cases, we made it available
to anyone enforcing a child support order.

Finally, again in 1991, Texas enacted a quasi-administrative process for obtaining
agreed orders in uncontested establishment and enforcement proceedings. This agreed order
is filed with the court clerk and the court renders its order without the necessity of a hearing
or any other action. This process was originally intended to be available only to the Attorney
General (as the IV-D agency) but again we opened this tool to county domestic relations
offices and friends of the court.

Through all these changes to Texas child support enforcement law, our intent was to
give custodial parents some real options in pursuing establishment and enforcement of child
support. When the most efficient and effective esublishment and enforcement tools are given
only to IV-D agencies, custodial parents are effectively left without any real alternative other
than the IV-D agency. However, when other non IV-D entities can obtain access to effective
enforcement tools, they become a viable, and perhaps for some custodial parents, a more
desirable alternative than the IV-D agency.

Congressional and state lawmakers should look more critically at current child support
laws, and all new child support legislative proposals, to consider every possibility for
permitting non-IV-D entities access to innovative establishment and enforcement techniques
previously reserved for, or planned for, the exclusive use by IV-D agencies.

Similarly, where there are good reasons for the IV-D agency to be the exclusive user
of an enforcement tool, such as certifying and submitting cases to the IRS for interception of
income tax refunds, every effort should be made to permit cooperative enforcement. For
example, if a non IV-D entity is assisting a custodial parent, and sees that there is an
opportunity to intercept an income tax refund, they should be permitted to submit the case to
the IV-D agency for "IRS intercept-only." The IV-D agency should be given authority to
submit the case for IRS intercept without first having to make it a full IV-D case over which
they then have to assume full responsibility for all enforcement. This selected IV-D
enforcement process makes it possible to keep cases out of the IV-D system that otherwise
would have to become the IV-D agency simply to utilize one beneficial IV-D enforcement
tool.

Objections to these recommendations to encourage non IV-D government and private
sector entities to become involved in child support enforcement will be that they could result
in case coordination and jurisdiction problems, that some custodial parents will have to pay
fees for services that are provided for free today by IV-D agencies, or perhaps that they will
lead to disreputable and unethical collection businesses which will take advantage of
custodial parents.

Indeed, in Texas, we heard many of these same concerns as we considered our new
legislation. Nonetheless, we concluded that these potential problems should not keep us from
permitting enforcement alternatives. Instead, we would face and deal directly with any
problems generated, and some problems did arise. However, as we found, when IV-D
agencies are willing to work with these other non-IV-D entities to solve problems, they will
find themselves with some innovative and aggressive new partners in the effort to help
custodial parents obtain enforcement of their child support.

Step Two: Early Intervention - Paternity Acknowledgement and Automatic Monitoring
and Enforcement

The problems facing the United States as a result of the increasing number of births
out of wedlock where there has been a failure to timely establish paternity are well known.
Aside from the legal rights (such as inheritance) and other physical and emotional benefits
that children bom out of wedlock and without benefit of paternity may never receive, the
failure to conclusively determine the identify of the biological father at birth has created a
major impasse in the ability of child support enforcement agencies to obtain and enforce
support orders for these children.

Similarly, in situations where parentage is established and a support order has been
issued, the failure to monitor payments for compliance and to automatically initiate
enforcement proceedings upon a delinquency has greatly contributed and continues to add to
the growing amount of child support that is not being collected in the United States.

Congress, the Administration and state legislatures can change this situation. The
CSC urges the following actions:

• First, Congress should pass and the President should approve the type of early
paternity establishment provisions included by this Subcommittee in the Budget
Reconciliation bill and those contained in Senator Bradley's legislation. This is an extremely
important step in the effort to identify the biological father as early as possible.

• Second, early paternity establishment should be one of the highest, if not the highest,
priority of the IV-D program. To promote even greater efforts by state and local IV-D
agencies to pursue paternity establishment, the CSC recommends that enhanced federal IV-D
funding (90% matching rate) be extended to include all costs related to parentage
establishment efforts, including efforts for obtaining voluntary acknowledgements. Currently,
just the cost of parentage testing is reimbursed at the 90 percent match rate.

There is one caveat to voluntary acknowledgement that needs to be noted. In our
haste to identify a father, we must be careful not to deprive alleged fathers of basic due
process considerations, including clear notice of the likely obligation that will result from
signing a voluntary acknowledgement form. Also, we believe it would be prudent to
encourage parentage testing as part of the voluntary acknowledgement process. There are a
number of reasons why this would be desirable, but one of the primary reasons is to
minimize the likelihood of later challenges to a voluntary acknowledgement. The results
from a parenUge test included as part of the acknowledgment form will make it extremely
difficult for a judge to reverse because of a later claim of lack of notice or fraud in signing
an acknowledgement form.

• Third, in addition to efforis to establish parentage at the eariiest possible time, it is

imperative to begin programs throughout the United Sutes to monitor all new child support
orders from the day they are issued and to have in place systems to automatically and
immediately institute enforcement of any delinquency. No other single factor has as much
impact on improving compliance with payment of child support than occurs through
monitoring of payments and the immediate and automatic enforcement of any late payment.

There are a number of studies that have shown that child support cases monitored
from the day they are issued through the end of the period of obligation, coupled with
immediate enforcement of delinquency, results in paying rates as high as 70 to 80 percent.
To implement such a system throughout the United States will be a substantial undertaking,
but is one that would do more to improve compliance with child support obligations than
anything else. Again, as with our earlier recommendations, this effort does not need to fall
exclusively on the IV-D program and to paid for by taxpayers. Instead, again using Texas
for illustration, several of these monitoring and enforcement systems are already in place. A
couple of them involve a cooperative relationship between the IV-D agency and county clerks
and for which Title IV-D funding is used. However, another one of these monitoring and
enforcement projects is run using only revenue generated from a monthly fee ($10) assessed
against each obligor.

In addition to the advantage of not having to be taxpayer funded, these systems do not
have to be operated and administered by government agencies. There is a bold new
experiment about to take place in Dallas, Texas that should be closely watched. The family
law judges in Dallas are preparing to award a contract to a private child support agency to
monitor all new support orders issued in their courts and to take automatic and immediate
enforcement action on any delinquency. This system will not use federal, state or local
taxpayer dollars. Instead, the cost of running the program will come from a nominal
monthly fee (about $10) that will be collected from every non-custodial parent. If necessary
to pay for this system, additional revenue could also be generated by "late payment
penalties" imposed on delinquent obligors.

If this effort is successful in Dallas, and paying rates of 70 -80 percent are achieved,
as expected, there is no reason why this monitoring and enforcement program could not be
replicated throughout the United States. What also makes the Dallas alternative particularly
attractive, is that there are no government costs for running the program. If it proves to be
even a minimally profitable undertaking for the private child support enforcement company
that has the contract, then others will certainly follow. For the federal government, every
case that can be handled effectively outside of the IV-D process means IV-D workers can
spend more time on cases they already have and can focus more attention on AFDC cases
that recoup government costs.

Again, this system will generate some of its own unique problems. The primary
issues will likely involve jurisdictional conflicts, particularly in interstate cases. However,
with the enactment of those provisions from the Interstate Commission's recommendations
that address the major jurisdictional problems that currently frustrate IV-D interstate
enforcement (along with the adoption by all states of the new Uniform Interstate Family
Support Act), problems faced by local enforcement entities will also diminish.

Other objections to this public-private sector initiative will come from those who
believe all custodial parents are entitled to free government enforcement services. In
response, these local initiatives are currently using fees assessed only against the non-
custodial parent. Further, should one of these projects determine that custodial parents
should also pay a small fee for the benefits provided by having the case monitored and
enforced, then some income eligibility or threshold could be established.

OTHER ALTERNATIVES:

IS FEDERALIZATION OF CHILD SUPPORT ENFORCEMENT

THE RIGHT WAY TO GO?

I.^gislation introduced in the 103rd Congress by Representative Henry Hyde (R-IL)
and Senator Richard Shelby (D-AL) would move IV-D enforcement from the state and local
level to the federal level and to be administered by the Internal Revenue Service.

There are some appealing aspects to these proposals. On the surface, it may appear
that collection of income taxes and child support would be similar and that the IRS can do a
superior job of enforcement for an increasingly interstate problem. Perhaps, with a
significant increase in funding, and after many years of training and experience in learning
how different it is to collect child support, the IRS could do a better job than what is
presently being done through the state and county-based IV-D program.

However, the CSC believes the alternatives we have identified and presented to this
Subcommittee are ones which will prove equally effective and can be accomplished without
massive new federal and state taxpayer dollars and adding to the size of the federal
government. Additionally, there is little evidence to suggest that the IRS would be able to do
a significantly better job at collecting child support to justify the extreme IV-D reorganization
effort that "federalization" would require.

Also, the U.S. Commission on Interstate Commission and the National Child Support
Enforcement Association (NCSEA) have come out against the federalization of child support
enforcement. The membership of NCSEA includes many of the more than 40,000 state and
local IV-D workers who perform child support enforcement everyday and who have a great
deal of knowledge and experience in this area. They simply do not believe that the IRS can
do this job better than they can. Indeed, the Wall Street Journal recently (June 2, 1993)
reported that the IRS collects only 14.5 cents on the dollar in tax liability owed. Hardly a
stellar performance.

This is not to say that there is not a stronger role to be played by the IRS in enforcing
child support. They have access to much data that would be very valuable in enforcing child
support. The Interstate Commission has recommended a number of ways in which the IRS
could be appropriately used to help enforce child support, including simplifying the referral
process for "full collection" cases to the IRS, which should be enacted.

At best, federalization is an idea that is probably premature and which, hopefully,
will not become necessary in the future.

CONCLUSION:
A REASON FOR HOPE

In closing, rather than being discouraged by the present situation of a desperately
overloaded IV-D child support system, this is one area of critical social concern for which a
solution is possible. It will not occur overnight, and advocates, as hard as it may be, must
be patient and give some time for the cure to work. Unfortunately, regardless of the
alternatives adopted by Congress and state legislatures, even if it is federalization of the IV-D

program, the change will not occur quickly enough to be of help to some of those who have
gone without support.

However, the Child Support Council believes that by starting now to address the
underlying reasons that have caused the current child support system to achieve only
marginal success, it is possible to see some hope for a solution to this problem in the not to
distant future.

The CSC does not believe the solution can come through efforts by IV-D agencies
alone, or those which rely exclusively on a taxpayer funded system, such as the IRS.
Instead, the CSC believes the solution will come from a truly bold, cooperative venture
between IV-D agencies, and other non IV-D state and local government and private sector
entities. Their combined resources, talent and penchant for innovation will bring about a
comprehensive system with each of these entities filling a special need in completing a new
system to serve all custodial parents and their children that deserve to receive the support for
which they have a legal and moral right.

Thank you, Mr. Chairman, and members, for this opportunity to present our views.
We hope they are of help to you as you continue your efforts to solve the child support
problem.

Chairman Ford. Thank you very much.
At this time Mr. Henry.

STATEMENT OF MICHAEL R. HENRY, DHIECTOR, VIRGINIA DI-
VISION OF CHILD SUPPORT ENFORCEMENT; AND IMME-
DIATE PAST PRESIDENT AND COCHAIR, INTERGOVERN-
MENTAL RELATIONS COMMITTEE, NATIONAL CHILD SUP-
PORT ENFORCEMENT ASSOCIATION

Mr. Henry. Mr. Chairman, members of the committee, I am
pleased to have this opportunity to testify on the status of State
child support enforcement programs.

My name is Michael R. Henry. I am the director of the Virginia
Division of Child Support Enforcement and former director of the
Missouri Child Support Agency. I am here today to testify on be-
half of the National Child Support Enforcement Association, for
which I am immediate past president and currently serve as
cochair of their intergovernmental relations committee.

We are an organization dedicated to enforcement of children's
rights to adequate parental support. The membership is comprised
of over 1,500 agencies and individuals representing the entire spec-
trum of the child support enforcement community, including State
and local administrators, caseworkers, judges, hearing officers, leg-
islators, prosecutors and private attorneys, and others.

I would like to spend a couple of minutes identifying unresolved
issues out of the Family Support Act of 1988, and then make a cou-
ple of comments regarding where we think we should be going in
the future.

One of the unresolved issues out of the 1988 act deals with im-
mediate income withholding for non-IV-D cases. Effective in Janu-
ary of next year, all child support orders must contain a provision
for immediate wage withholding. The requirement applies unless
the parties agree to an alternative arrangement, or the court ad-
ministrative agency finds there is good cause not to impose imme-
diate income withholding.

The Federal Office of Child Support Enforcement has construed
this mandate to require that payments be routed through and
tracked by a State or local agency, which will almost always be the
IV-D agency.

Moreover, they have determined that Federal financial participa-
tion is not available to partially offset the cost that accompanies
this mandate. We question whether this was congressional intent
and ask for amendments to make that issue clear.

Another issue deals with the 1988 act's requirements that State
IV-D agencies review and adjust support orders periodically in
AFDC cases and upon the request of either parent in non-AFDC
cases. Our concern here is the extent to which the act requires the
State child support agencies to advocate on behalf of noncustodial
parents for downward adjustments.

Although we certainly don't have any problems with downward
adjustments when they are appropriate using the State's guide-
lines, we have come to recognize as we have tried to implement
this that there are confiict-of-interest problems, particularly for at-
torneys on the front lines of the child support agencies around the
country. These attorneys may find themselves in court one day

seeking to imprison a particular noncustodial parent for failure to
pay, and then might well be in the same court the following week
advocating on his behalf for downward modification. It is some-
thing that is causing child support attorneys around the country a
lot of difficulty.

The American Bar Association has issued an advisory opinion
that there is an attorney-client relationship between the attorney
and the custodial parent. Presumably that same reasoning would
apply to services for noncustodial parents. It is difficult for the pro-
gram and the attorneys to reconcile those conflicts.

As far as where we believe we should be going, we are on record
as opposing federalization, and I refer you to the numerous com-
ments directed to this subcommittee last summer, when a hearing
was held to discuss that issue. Our main concerns deal with cost.
I think we are probably talking about the need to hire in the area
of 40,000 Federal employees to federalize the program.

Previous federalization proposals have further fragmented the
program by bringing in several different agencies. We see a long
timeframe in getting to implementing a Federal program due to
conversion complexities. Plus, there is no service delivery system in
place for the Federal Government to take over.

We do very much support the recommendations of the Interstate
Commission, particularly 1 and 2, dealing with staffing and train-
ing. Many of us believe that the most significant problem in the
program is case loads that exceed 1,000 per worker in many juris-
dictions. That boils over into the interstate problem. I think it is
more a situation of cases getting worked because someone is com-
plaining, and you tend to get more complaints from custodial par-
ents who reside in your State.

So there is a natural preference that States give for in-State
cases. When you have case loads of 1,000 and it is possible for
somebody to handle a case load of 400 or so, the more difficult
cases, such as contested paternity cases, interstate cases and cases
involving self-employed or underemployed, noncustodial parents
don't get the attention they deserve.

We also need better location and case tracking through improved
automation. Recommendations 4 through 10 in the Interstate Com-
mission deal with this quite well.

I would also particularly suggest we need better access to Fed-
eral tax data, and we need to be able to use it in court and in ad-
ministrative proceedings at the State level, whereas now we are
prohibited from doing that.

My time has expired. I would refer you to the remainder of the
report.

[The prepared statement follows:]

STATEMENT BY

MICHAEL R. HENRY

NATIONAL CHILD SUPPORT ENFORCEMENT ASSOCIATION

BEFORE THE

SUBCOMMITTEE ON HUMAN RESOURCES

COMMITTEE ON WAYS AND MEANS

U.S. HOUSE OF REPRESENTATIVES

Introduction. Mr. Chairman, distinguished members of
the Committee: I am pleased to have this opportunity to
testify on the status of state child support enforcement
programs .

My name is Michael R. Henry. I am the Director of the
Virginia Division of Child Support Enforcement and former
Director of the Missouri child support agency. I am here
today to testify on behalf of the National Child Support
Enforcement Association (NCSEA), for which I am Immediate
Past President and currently serve as Co-Chair of the
Intergovernmental Relations Committee.

NCSEA is a national organization dedicated to the
enforcement of children's rights to adequate parental
support. NCSEA's membership is comprised of over 1,500
agencies and individuals representing the entire spectrum of
the child support enforcement community — state and local
administrators, case workers, judges, hearing officers,
legislators, prosecutors and private attorneys. Founded in
1951, NCSEA is the largest group in the country devoted
exclusively to child support enforcement.

I commend you for your commitment to improving the
status of America's children and families and for soliciting
testimony from those of us who have practical, hands-on
experience in child support enforcement.

I would like to discuss where we are and where we should
be going to improve child support enforcement. I will begin
by talking about a couple of the issues surrounding the
implementation of the Family Support Act of 1988. Then, I
will present NCSEA's view of where we should go from here.

I. WHERE WE ARE; IMPLEMENTATION OF THE FAMILY SUPPORT ACT
OF 1988.

As you know, some of the provisions of the Family
Support Act have been implemented, while others await
implementation. I will limit my comments to two provisions
of the Act: (1) the requirement of immediate wage withholding

in all child support cases, including non-IV-D cases; and (2)
periodic review and adjustment.

Effective January 1, 1994, all child support orders must
contain a provision for immediate wage withholding. The
requirement applies unless the parties agree to an
alternative arrangement or the court or administrative
process finds that there is good cause not to include such a
provi sion .

Our concern? The law has been interpreted so that the
costs of administering this provision will not be eligible
for Federal Financial Participation (FFP) reimbursement. We
estimate that from the point of case initiation through such
on-going tasks as billing employers by mail, collecting
payments, generating and mailing payment checks, responding
to inquiries from both custodial and non-custodial parents,
and monitoring and maintaining accounts, some states will
incur expenses of up to $200 per case per year to administer
this requirement. Because OCSE is limiting cost-recovery to
$25.00 per case, states will have to make up the difference.

Under existing law, FFP is available to offset state
expenditures for the operation of the IV-D plan -- and the
wage withholding provisions of Section 466 of the Social
Security Act, including the provisions that apply to non-IV-D
cases, are IV-D plan requirements. See 42 U.S.C. S$ 654(20)
and 655(a)(1). Just as location services provided to
individuals not receiving full IV-D services are eligible for
FFP, wage withholding services in non-IV-D cases should also
qualify for federal reimbursement. We urge Congress to
eliminate any ambiguity in the law by authorizing the states
to recover the costs of administering the wage withholding
provision .

The second issue I would like to address is periodic
review and adjustment of child support orders. OCSE has
interpreted the Family Support Act to require IV-D agencies
to actively initiate downward modifications if requested by
non-custodial parents. In other words, the IV-D agency may
be aggressively enforcing a child support order against a
non-custodial parent who, under this interpretation, could
immediately request that the IV-D agency assist him or her in
obtaining a downward modification of the order. This
interpretation has led to heated debates at numerous national
conferences, particularly among child support attorneys who
see in this proposal a serious threat to accepted standards
of professional conduct.

Our concern is that there is a conflict of interest in
simultaneously providing services to both custodial and
non-custodial parents. Inasmuch as the IV-D agency performs
the roles of investigator, negotiator, and prosecutor for
custodial parents seeking to establish, modify and enforce

child support orders, the agency cannot then reverse roles in
the same case and initiate proceedings for non-custodial
parents seeking downward adjustments in their orders.

Compounding this dilemma is the fact that despite the
dramatic expansion of services to non-AFDC families since
1984, all IV-D programs are still driven to a great extent by
AFDC collections. Incentive payments are based on the ratio
of AFDC collections to the cost of the program. Many state
legislatures set collection goals to measure the
effectiveness of the program. As it is, to the extent that
adjustments increase the child support amount sufficiently to
close the AFDC case, the IV-D agency — in a direct sense —
is hurting its AFDC collections by pursuing upward
adjustments in child support orders. To then require the
agency to initiate downward adjustments creates an untenable
conflict of interest-
While the IV-D agency can surely disclose financial
information in its possession to both parties, ensure that
orders are based on proper evidence and treat non-custodial
parents in a fair and just manner, its limited resources
should not be concentrated on the pursuit of downward
adjustments. We ask that Congress ensure that IV-D agencies
be allowed to focus their energies on obtaining upward
adjustments in child support orders and identifying clear
criteria for adjustment, clarifying the burden of proof,
facilitating discovery, simplifying procedures, making courts
more accessible, making form pleadings available, and
providing simple instructions on how to obtain a pro se
downward modification.

II. WHERE WE SHOULD GO FROM HERE; BUILDING UPON THE EXISTING
STATE-BASED IV-D CHILD SUPPORT SYSTEM.

Where should we go from here? The bottom line in the
discussion about reform is that child support enforcement
requires greater uniformity among the states. The overriding
question is how to achieve it. First, I would like to
explain why NCSEA opposes federalization. Then I will
discuss how we propose to build a new and improved child
support enforcement system on the foundation of the existing
state-based IV-D system.

A. Federalization is Not the Answer.

Why does NCSEA remain steadfastly opposed to shifting
responsibility for the collection, enforcement and
modification of child support obligations from the states to
the federal government? While we endorse many features of
the Child Support Enforcement and Assurance Proposal, we
disagree with the proposal's federalization component for
three main reasons.

First, proposals to federalize child support enforcement
are premature. The Family Support Act requires the states to
have statewide automated tracking and monitoring systems by
1995. Almost half of the states are already implementing
these systems at an average cost of $10 million per state.
Most of these costs are reimbursed by the federal government
at a rate of 90%. It seems premature — and wasteful — to
recommend the abolition of the IV-D system while the states
are assembling the building blocks to get the job done.
Furthermore, even if proposals to federalize child support
enforcement live up to their exacting standards, it will be
at least a decade before federalization is fully implemented
-- a timeframe that is too long for most American families.

The second reason we oppose federalization is that it
will undermine efforts to reduce the federal deficit and
curtail spending initiatives. The cost of transferring child
support cases from 54 jurisdictions to the federal government
will be significant. Few states have centralized child
support functions; most have child support systems that are
county-based or court-based. This cost must be added to the
cost of creating yet another layer of federal bureaucracy
within both the Internal Revenue Service and the Social
Security Administration.

Last, we strongly believe that child support policy must
be national but implementation must remain local.
Federalization would encroach upon a domain of family law
that has historically been reserved to the states and that is
inextricably intertwined with such issues as custody, alimony
and property division. This seems incongruous at the very
juncture in world history where the impetus is toward
decentralization and the empowerment of local institutions
that can revitalize democratic government. The current child
support enforcement system strikes the proper balance between
national objectives and diversity among the states.

B. Measures to laprove the Child Support Enforceaent
Program.

If federalization is not the solution to improving child
support enforcement, then what is the answer? Our strategy
centers around two key approaches: elevating the IV-D agency
within the hierarchy of each state's government; and adopting
the recommendations of the U.S. Commission on Interstate
Child Support.

1. Elevate the IV-D Agency within the Hierarchy
of Each State's Government.

As you know, each state is required by federal law and
regulation to establish or designate a single and separate
organizational unit to administer its child support
enforcement program. A state may establish a new agency to

administer the IV-D program or locate the IV-D agency in an
existing state agency, such as the attorney general's office,
revenue department or public welfare agency. Even though a
state's IV-D plan must indicate the location of the IV-D
agency if the IV-D agency is housed within another state
agency, there is no federal mandate — or incentive — for
placing the IV-D ag??ncy in a position of priority within the
overall administrative hierarchy. Yet, as we all know, the
organizational location of any agency indicates the priority
accorded to the agency's mission and determines the amount of
resources devoted to the agency's mission.

The most effective way to improve the child support
enforcement program is not to undertake the wholesale
transfer of the program from the state and local level to the
federal government, as proponents of federalization advocate;
instead, efforts to reform the system should concentrate on
elevating the IV-D agency to a position within each state's
government that demonstrates a firm commitment to child
support enforcement. In addition, if the IV-D agency is
located within an existing state agency, the IV-D director
should be accountable to the agency's commissioner or a
person of comparable status and authority.

We recognize that the appropriate location of each IV-D
agency will depend upon each state's unique structure. But
such efforts will enhance the visibility and status of the
IV-D agency, ensure that adequate resources are dedicated to
the agency's mission, and increase the likelihood that
qualified individuals with strong leadership skills will seek
to serve the agency. If you look at the record of successes
and failures, you will see that the IV-D agencies that have
made the most impressive strides in child support enforcement
are those that are, literally, positioned for success. We
strongly encourage Congress to focus on measures to require
or encourage each state to elevate its IV-D agency to a
position within the governmental hierarchy that reflects the
importance of its mission.

2 . Adopt the Recommendations of the U.S.

Commission on Interstate Child Support.

The second feature of our strategy to improve child
support enforcement is adoption of the recommendations of the
U.S. Commission on Interstate Child Support. Over the course
of the development of the child support program, the states
have served as "laboratories of democracy"; virtually every
new idea — from programs to establish paternity at the time
of a child's birth to the reporting of newly hired
personnel — has been conceived in the states. Adoption of
the Commission's recommendations will allow the states to
continue to serve as laboratories of democracy — and to
replicate the most successful practices of the most
innovative states. We urge Congress to give priority to the

following recommendations

a. Establishment of Winimua Staffing and
Training Standards.

If we are to improve child support enforcement, it is
essential that we have adequate numbers of well-trained
people serving children in need. No legal reform, no
automated system, and no new procedure will make a positive
difference unless child support agencies are properly
staffed.

We recommend that states be required to staff their
child support programs at a minimum level, based on staffing
studies to be conducted by OCSE. Congress should take action
to ensure that the staffing levels in the state and local
agencies are increased. In addition, states should be
required to have minimum standards in their plans for
training for all persons involved in the child support
program under Title IV-D. We request that Congress
appropriate and earmark sufficient funds for training
purposes .

b. Adoption of UIFSA.

We also urge Congress to mandate that the states
implement verbatim the new Uniform Interstate Family Support
Act (UIFSA) by a specific date, no later than July 1, 1996.
This will ensure that state laws and procedures for
establishing and enforcing support in interstate cases are
consistent .

c. Reporting of New Hires.

Third, Congress should mandate that each state require
employers to report the names and Social Security numbers of
their new employees. This is one of the most important
recommendations in the Commission's report. This measure
will greatly expedite the location of child support obligors
and the deduction of child support from the obligors' wages
to comply with child support orders.

We advocate the approach used in Washington State,
Massachusetts, Iowa and other states. These states merely
require the employer to send a copy of the W-4 to the IV-D
agency via FAX, computer tape, mail or other acceptable
means. This information can be matched against child support
records to determine whether the new employee has a child
support obligation and, if so, enable the IV-D agency to
automatically send a notice to the employer indicating the
amount of the obligation and the name of the payee.

In one way or another, the IV-D agency must acquire
information about the scope and cost of health care coverage

available to the new employee. Congress should examine
whether the W-4 form is the proper vehicle to accomplish this
goal and, if so, require the Secretary of the Treasury to
revise the form accordingly.

Also, any penalties for noncompliance with the employer
reporting requirement should be established by federal law to
ensure uniformity among the states.

d. Establishment of Paternity in the
Hospital .

All states should also be required to develop procedures
for voluntary parentage acknowledgment that will result in a
legal finding of parentage shortly after the birth of a child
to unmarried parents. Washington State pioneered this
program and Virginia and several others states have highly
successful programs. The paternity establishment rate has
jumped -- almost 60% of fathers acknowledge paternity — and
the costs of location and blood and genetic marker tests have
dropped. This is yet another example of the type of
initiative that can be and should be replicated in other
states .

e. Withholding of Licenses.

Congress should also consider requiring all states to
deny professional, business and trade licenses to delinquent
child support obligors, especially in cases where the obligor
is self-employed. Arizona and Vermont already link the
issuance or renewal of a license to the payment of child
support. Similar legislation has been proposed in both
Michigan and Missouri. A federal mandate would facilitate
passage of such legislation by other states.

f . Use of Administrative Liens in all Cases
with Past-Due Support.

States should also be required to enact laws requiring
that certain lump-sum payouts, including lottery winnings,
insurance settlements and the proceeds of lawsuits, be used
to satisfy past-due child support.

Currently, in some instances the IV-D agency does not
receive prior notice of impending payouts or settlements; as
a result, child support liens are not imposed and
opportunities are lost to recover past-due support. In other
cases, liens are imposed only after assets are identified —
and then liens are imposed individually, on a case-by-case
basis, a cumbersome, labor-intensive process. We propose an
alternative way to ensure that an obligor's assets are
available to satisfy a child support debt: the use of an
administrative lien.

As a result of the Bradley Amendment of 1986, every
child support payment becomes a judgment by operation of law
as of the date it is due and unpaid. This makes it
unnecessary to return to court and reduce arrears to judgment
in order to collect a child support debt. This amendment is
the basis for creating an administrative lien process that is
analogous to the tax refund intercept process.

The first step would be to provide that just as a child
support payment becomes a judgment on the date it is due and
unpaid so, too, a lien arises at the time a child support
payment is due and unpaid. The lien would encumber all of
the obligor's real and personal property. On an annual
basis, the agency would send the obligor a notice specifying
the amount of the child support debt, the enforcement
measures that the agency is authorized to use to collect the
debt and informing the obligor of his right to request an
administrative review. This notice could, conceivably, be
incorporated in the notice that the agency is already
required to send to obligors for purposes of the tax refund
intercept program.

Next, the agency would conduct computer matches to
locate any assets that may be used to satisfy the debt. For
example, the list of delinquent obligors could be matched
against the records of the registry of motor vehicles, the
secretary of state's office, insurance companies, banks and
other financial institutions or the registries of deeds. As
appropriate, measures would be taken to perfect the child
support lien. Thus, child support liens could be imposed on
a wholesale basis, rather than "by the each." To make this
enforcement remedy as effective as possible, it would be
necessary for Congress to require that a child support lien
imposed by a IV-D agency be recognized across state lines, in
much the same way as a judgment rendered in one state is
entitled to full faith and credit by other states or a wage
withholding order is honored across state lines.

g. Other Recommendations.

We would also like to urge Congress to adopt several
other recommendations of the U.S. Commission. Briefly,
Congress should —

o expand the network for locating non-custodial

parents and their income and assets by granting
child support agencies timely access to federal tax
information and requiring the states to to adopt
laws granting the agencies access to additional
in-state information sources;

o amend and expand the Employee Retirement Income
Security Act (ERISA) to ensure that pensions and
other retirement funds are easily attachable to

satisfy child support duties;

o provide that children receive adequate health care
coverage by mandating that the insurance industry
cooperate to provide coverage for all eligible
children, regardless of their residence or the
marital status of their parents; and

o examine various IV-D funding formulas and revise
the incentive formula to require the reinvestment
of incentives into the child support program.

The Commission has provided a blueprint for reform that
is sufficiently detailed to permit its swift implementation
-- and likely to garner broad bipartisan support in the
United States Congress. Many of the Commission's
recommendations have been incorporated in the Interstate
Child Support Enforcement Act, recently filed by Senator
Bradley. NCSEA enthusiastically endorses the bill and is
committed to working for its swift passage and
implementation.

Before I close, I would like to take this opportunity to
caution you about a proposal that would require IV-D agencies
to use their location resources to provide information for
the purpose of enforcing visitation orders. We have
significant questions and concerns about such a requirement
— especially given the epidemic of domestic violence that is
sweeping the nation. According to the Surgeon General,
"domestic violence is the single greatest cause of injury to
women in the United States, accounting for more injuries than
automobile accidents, muggings and rapes combined." We
respectfully request that Congress carefully evaluate any
proposal to impose such a requirement on IV-D agencies to
ensure that cases of domestic violence are identified, that
information is protected when appropriate and that the
provisions can be effectively administered by the IV-D
agency.

Conclusion. In closing, we urge you to balance the need
for continuity with the need for aggressive innovation by
endorsing the recommendations of the U.S. Commission. We are
committed to working with Congress to ensure that our
nation's child support enforcement system is reformed in a
manner that best serves the needs of our nation's children
and families.

Thank you for giving me an opportunity to testify on
behalf of NCSEA. We look forward to continuing to work with
you.

Chairman Ford. The testimony of all of the witnesses will be
made part of the record.
At this time, Mr. Jackson.

STATEMENT OF LARRY D. JACKSON, CHAIR, NATIONAL COUN-
CIL OF STATE HUMAN SERVICE ADMINISTRATORS, AMER-
ICAN PUBLIC WELFARE ASSOCIATION, AND COMMISSIONER
OF THE VIRGINIA DEPARTMENT OF SOCIAL SERVICES

Mr. Jackson. Thank you, Mr. Chairman.

I am here as the Commissioner of the Virginia Department of So-
cial Services.

Mike and I are always glad to be able to be here. We hope it is
because we are good. We sometimes feel it is only because we are
100 miles down the road.

I am also here as chair of the National Council of State Human
Service Administrators, and I also presently serve as the chair of
APWA's Welfare Reform Task Force Group on Self-Sufficiency.

I want to go right to the heart of what I think some of the issues
are, some of the improvements that need to be made, some of the
help we need to receive from you.

There is no question, as you have heard several times this morn-
ing, paternity establishment needs to be improved. You cannot es-
tablish an order if you don't know who the parent is.

There are a number of things that some of the States are doing,
including, as Mr. McDermott mentioned this morning, in Washing-
ton, and also the Commonwealth of Virginia is working diligently
with our hospitals. We have 33 hospitals on line that help us estab-
lish paternity.

In 1987 in Virginia we established paternity in over 2,000 out-
of-wedlock births. This year it will be 20,000, which means we are
almost at about 75 percent of all out-of-wedlock births taking place.

We have paid a lot of attention to that situation. We think it can
be done in other States. We think it can be done on a voluntary
arrangement with those hospitals who have been extremely cooper-
ative in working with us through the Virginia Hospital Association.

There also has to be an improvement in the establishment of
child support orders. The best way to avoid paying child support
in this country is to move across State lines. You have also heard
that from a number of people this morning.

We think there needs to be uniform rules for the jurisdictions on
orders for child support. We think this can be established through
the Uniform Interstate Family Support Act, UIFSA, if you will,
which will require employers to report new hires within 7 days by
submitting to the State copies of the W-4 form, which is a form we
all fill out as we become employed, but really goes no place. It just
gets filed someplace within the employer's group or business and
there is no reason why that form cannot be transmitted.

We are requiring tnat now in Virginia, effective July 1. We will
have that 7-day reporting requirement on our employers. That leg-
islation was passed by our General Assembly this past session.

We also would suggest to you that while APWA does not nor-
mally recommend Federal mandates where we are dealing with
cases of an interstate nature, of which about 33 percent nationwide
are in that category. They are the most difficult to collect on, par-

ticularly for a State on one of the seaboards where we have people
traveling from New York down to Virginia down to Florida, chang-
ing jobs on a periodic basis, where we deal with a major migration.
In a State such as California, which has problems of its own in col-
lecting its own child support let alone working with States on their
cases, there really needs to be something done in this particular
area if we are going to improve the collection of child support in
this country.

The U.S. Commission on Interstate Child Support has supported
these recommendations and recommended UIFSA, and we pair
with them as we do on many of their recommendations. There
needs to be an improvement in enforcement collection. We believe
we have established a need for a national commission to develop
national child support guidelines.

We know that the 1988 legislation ordered the States to develop
guidelines. That has been done in most cases. However, those
guidelines are not uniform across the States. We believe that would
serve well in terms of taking better care of our children and the
families if we had guidelines that were of a nature that no matter
if you were in California or Virginia, you knew what your guide-
line, your payment, was going to be relative to your income.

We also think that the health care issue is extremely important
in the establishment of these orders. Something in the neighbor-
hood of 60 percent of all support orders lack health insurance cov-
erage or health insurance mandates in those orders when they
come down.

Part of that problem that we have identified in Virginia is a re-
sult of ERISA, which is the Employer Retirement Income Security
Act, which forbids the States to force companies who are self-in-
sured to have health care plans that would be applicable to the
groups of children that we are concerned about here. That is prob-
ably over half of our employers in Virginia that are under that self-
employed insurance situation. We would also believe that there
needs to be adequate resources for the program.

Again, the situation of 1,000 cases per worker is not conducive
to getting the job done. We believe that OCSE should conduct a
study to determine what adequate staffing levels should be, and
those recommendations should be applied nationwide.

Lastly, we also believe that there needs to be reform of the child
support audit process. The audit process now is absolutely an audit
of processes. It doesn't measure at all what outcomes are. We be-
lieve those outcomes should measure paternity, order establish-
ment, collections, health insurance, and distribution. This would
establish uniformity and accuracy of data, reporting, and hold
States accountable for effective programs.

I also believe it would give the States some really definite targets
they need to be shooting for, as opposed to trying to figure out how
we are going to beat the game on this process audit. We have been
through this twice in Virginia. We have passed it both times. I can
assure you it is time consuming and painful and it doesn't accom-
plish anything.

Mr. Chairman, that concludes my remarks.

[The prepared statement follows:]

TESTIMONY OF LARRY D. JACKSON
AMERICAN PUBLIC WELFARE ASSOCIATION

Good morning. Chairman Ford and members of the Subcommittee on Human Resources
I am Larry Jackson, Commissioner of the Virginia Department of Social Services and
Chair of the American Public Welfare Association's National Council of State Human
Service Administrators I also chair APWA's welfare reform group, the Task Force on
Self-SuflBciency. APWA is a nonprofit bipartisan organization that represents the 50 state
human service departments, local public welfare agencies, and individuals concerned with
social welfare policy and practice.

Mr. Chairman, half of all children bom this decade will live in a single-parent family at
some point in their life Given that half of our children will potentially be eligible for child
support and need assistance fi^om the child support system, how is the system doing? The
answer is that there is both good news and bad news. The good news is that the program
has improved in many areas. The bad news is that we have a long way to go — the system
needs major reforms. I will discuss the reforms in APWA's 1 7 point child support reform
proposal and some issues regarding the implementation of the child support provisions of
the Family SupfK)rt Act. But first the good news.

Improvements in the Chiid Support System

The good news is that we have made improvements in many areas of the program.
According to the federal OfiBce of Child Support Enforcement (OCSE), in the last five
years the IV-D system:

• Increased collections fi-om $3 9 billion to $6 9 billion, an increase of 77 percent.

• Increased the total number of IV-D cases in which a collection was made firom about
1.7 million to 2.6 million, a 53 percent increase.

• Increased the total number of locates of absent parents fi-om 1 1 million to 2.6 million,
a 136 percent increase.

• Increased the total number of paternities established fi-om about 269,000 to 479,000, a
78 percent increase.

We believe that these increases ~ despite huge increases in caseloads ~ are due in large
part to the hard work and improvements by the state child support agencies.

Problems With The Current Child Support System

The bad news is that the current system, unfortunately, is still not working very well.
States do not have the tools or the resources to run a truly eflFective system. The sad truth
is that only 60 percent of eligible women have child support orders and only half collect
the fijU amount This means that almost 75 percent of mothers entitled to child support
either lack support orders or do not receive the full amount due under such orders
Furthermore, the percentage of total IV-D cases with collections is still too low. This
figure ~ just under 20 percent ~ simply is not acceptable.

As the state administrators of these programs, we are painfully aware that the system is
broken and needs fixing That's why as Chair of APWA's National Council I appointed a
task force last year to develop recommendations to reform the system. The product is our
17 point resolution which our organization passed in December, 1992 Our welfare
reform task force is considering additional reforms. I'd like to take a few minutes to
briefly discuss the highlights of our reform proposal.

Reforms of the Child Support System Supported By APWA

First, we must improve paternity establishment. We believe that states should be
required to develop procedures for voluntary parentage acknowledgment both in hospitals
and through an administrative process operated by the state IV-D agency.

72-449 - 93 - 4

Paternity establishment is a prerequisite for obtaining a child support order but currently
one out of every four children bom in this country each year is a nonmarital birth
according to OCSE. This produces a situation where paternity is established in less than
one-third of the noiunarital births.

Studies show, however, that more than 80 percent of parents of nonmarital children are in
contact with each other at the time of birth. States such as my state of Virginia and
Washington State have been very successful in increasing paternity establishment by
conducting outreach at hospitals and birthing centers. We generally support proposals in
the president's budget currently being debated by Congress that would require states to
establish new, higher performance standards for paternity by setting up voluntary
acknowledgment processes in hospitals.

Second, we must improve the establishment of child support orders. We endorse
requiring states to provide uniform rules for the jurisdiction of orders through the Uniform
Interstate Family Support Act (UIFSA) and require employers to report new hires within
seven days to the state via a copy of the W-4 form.

Currently, the easiest way to avoid paying child support is merely to move to another
state. One-third of all child support cases are interstate meaning that the father and
mother live in different states. But only 10 percent of the dollars collected are from
interstate cases And over time an even larger percentage of all cases are interstate since
people move so frequently.

The only way to deal with the interstate problem is to make the state systems more
uniform. States should be required to provide uniform rules for jurisdiction of orders
through the Uniform Interstate Family Support Act (UIFSA), a model law developed by
the National Conference of Commissioners on Uniform State Laws. According to the
American Bar Association (ABA), six states have ah-eady adopted UIFSA including
Arizona, Arkansas, Colorado, Montana, Texas, and Washington State.

States currently have different versions of an interstate statute that was developed during
the 1950s and 1960s. However, all states now need a statute that is the same and that is
updated for the problems of families in the 1990s. Normally, APWA opposes federal
mandates We continue to oppose unfunded mandates But we support this mandate on
the child support system as the only way to deal with the problem of interstate child
support cases.

Under our proposal, states would have approximately three years from the date the federal
law was enacted to adopt UIFSA and all states would then begin using the new method of
handling interstate cases on the same date (for example, January 1, 1996). The U.S.
Commission on Interstate Child Support, which was established by the 1988 Family
Support Act to study interstate issues, also recommended that all states adopt UIFSA.

We also recommend that employers be required to report new hires within seven days to
the state via a copy of the W-4 form. Based on a process operating in the State of
Washington, this system would use a revised W-4 form for a new employee to report any
child support obligation and to allow states to identify cases in which they can initiate
income withholding The problem with the current system is that most states receive
employer wage information three to six months after the employee is hired, so the
information is generally too old to be useful

The proposed W-4 reporting process would begin when a new employee completes the
paperwork on the first day of the job An expanded W-4 form would require the
employee to report the amount of the child support obligation paid under an income
withholding order, the name and address of the payee, and the availability of health
insurance This information would be stored in a Registry of Support Orders in each state.
The Registries would include all IV-D support cases and private cases where either party
requests that their case be part of the registry Each state system would be able to
communicate with other state systems to create a national system W-4 reporting is a

proactive measure that benefits the state and obligees by providing early identification of
employment for the immediate implementation of income withholding

Third, we must improve enforcement and collection. We recommend establishing a
National Commission that includes significant state involvement to develop national
support guidelines. We also recommend that children receive adequate health care
coverage by mandating that federal and state laws provide for access to coverage for all
eligible children regardless of their residence or the marital status of their parents.

The 1 988 Family Support Act mandated that every state develop their own guidelines to
be presumptively applied in all cases However, the interstate problem discussed in the
previous recommendation means that an effective child support system requires national
uniform guidelines. We endorse the Interstate Commission's recommendation that a
National Child Support Guidelines Conmiission be established to develop a national child
support guideline after undertaking an analysis of current national support guidelines
models while also taking account of regional cost-of-living differences. This is not an
immediate mandate on states but an attempt to move toward a national uniform system.

In terms of health care, currently about 60 percent of all support orders lack provisions
regarding health insurance. Furthermore, many insurance companies ignore health care
orders. One of the principle problems is that the 1974 Employee Retirement Income
Security Act (ERISA) does not allow states to regulate employers who have self-insured
plans. Although ERISA mostly deals with the protection of employee pension plans, even
when there is an order for health coverage the self-insured exemption allows many
employer-provided insurance plans to discriminate in dependency coverage, obligors to
fail to enroll their children as ordered, insurance carriers to refuse to accept claims filed by
the custodial parent on behalf of the employee's dependent, and obligors to pocket
insurance reimbursements rather than forward the money to the custodial parent.

Congress should remove the effects of the ERISA preemption of state regulation
regarding health care coverage for children by amending ERISA to subject self-insured
health care plans to state regulatory control.

Fourth, we must provide adequate resources to the prognini. We recommend raising
the Federal Financial Participation (FFP) match rate fi'om 66 percent to 85 f>ercent,
restructure or abolish incentives, and require a state maintenance of effort to provide
adequate resources for the child support program.

One of the top priorities for the child supp>ort system is to provide adequate resources
through funding reform and simplification of the funding mechanism. Nationally, the
average cases-per-worker is 1,000 We need adequate resources to provide reasonable
staff levels One of the proposals that our welfare reform task force is considering is the
proposal made by Senator Daniel Patrick Moynihan that would raise the match rate fi'om
66% to 85%, abolish incentives, and require a state maintenance of effort This would
provide the resources to provide reasonable staff levels to provide children the support
they need. We also recommend that OCSE conduct a study to determine adequate
staffing levels.

Fifth, we must reform the child support audit process. We recommend establishing a
Commission that includes significant state involvement to develop regulations to change
the child support audit system from a process-oriented system to an outcome-oriented
system.

The present federal child support audit criteria contain more than 130 process-oriented
criteria focusing on whether certain pieces of paper were properly filed instead of whether
the child support was actually paid This focus on administrative process rather than
performance outcomes makes for a flawed audit system where 71 percent of the states do
not pass their initial audit Most states do eventually pass the audit af^er a corrective
action period However, the current audit process requires the OCSE to commit
approximately 50 percent of its central office staff resources to the audit function.

Over the last year, APWA developed our audit proposal in conjunction with the National
Governors' Association (NGA) and the child support directors. We believe that the best
reform would be for a Commission to develop audit criteria for the Department of Health
and Human Services to implement through regulations. Specifically, the Commission
would develop regulations to reform the child support audit system to measure
performance outcomes. Outcomes would be measured on paternity establishment, order
establishment, collections, collections of arrears, health insurance, and distribution. This
would ensure uniformity and accuracy of data reporting and hold states accountable for
efifective programs. We would like to thank Congressman McDermott for introducing this
proposal as a bill, HR 2241, and ask that the members of this committee for their support.

Sixth, we must establish federally funded demonstration projects of child support
assurance. A Child Support Assurance System (CSAS) has been operating in many
countries including Great Britain, Sweden, Germany, and Israel and recently has received
an increasing amount of attention in this country. CSAS would guarantee a minimum
child support benefit to all custodial parents who have a child support order and have
established paternity. The federal government would make up any difference between the
amount of support collected and a predetermined minimum benefit level. Unlike welfare
programs, child support assurance is universal — there is no means-testing. The payment
would not be reduced by earnings of the custodial parent, allowing her both to work and
to receive stable and consistent payments of support. Child support assurance provides
consistent and timely child support benefits to custodial parents to allow them to achieve
greater self-sufBciency and independence. In the United States, Wisconsin and New York
have established forms of child support assurance.

There is bipartisan consensus that there should be demonstration projects of child support
assurance. The Interstate Commission, the National Commission on Children, the
Downey-Hyde proposal, and the House Republican's child support proposal all include
assurance demonstrations. We recommend that six to ten states be allowed to conduct
child support demonstration projects. After a suitable evaluation period, we recommend
allowing additional states who meet certain minimum criteria in their child support
programs to participate in the program. This would keep national costs down because
only the best programs could participate and provide an additional incentive for all states
to improve their FV-D programs.

ImplementatioD of The Family Support Act

Finally, I would like to make several observations on the implementation of the child
support provisions of the Family Support Act of 1988. As you know, the backbone of any
successful child support system is its automation system. The Family Support Act
mandates that states develop statewide automated child support enforcement systems by
October 13, 1995. States are struggling mightily with meeting this deadline due to a huge
increase in caseload (almost 50% in food stamps and 33% in AFDC), delayed release of
the final regulations by OCSE, disputes by contractors, and the inherent diCBculty of
automating huge databases. Although we are not asking for an extension of the 1995
deadline, the committee should be aware that 10 to 20 states will have great problems
meeting the deadline.

Another Family Support Act mandate is that by January 1, 1994, all cases — including
non-IV-D cases — must be enforced by immediate income withholding without regard to
arrears. Although we support the use of immediate income withholding for non-IV-D
cases, you should be aware Mr Chairman that OCSE has indicated that when the IV-D
agencies monitor these cases, Federal Financial Participation (FFP) may not be available.
We strongly disagree with this interpretation and ask for your support in developing a
more reasonable outcome. Just as location services provided to individuals not receiving
full IV-D services are eligible for FFP, wage withholding services in non-IV-D cases
should also qualify for federal reimbursements

Finally, OCSE has interpreted the Family Support Act to require IV-D agencies to initiate
downward modifications if requested by non-custodial parents We believe that there is a

conflict of interest in providing services to both the custodial and non-custodial parents.
We also question whether the limited resources of the FV-D agencies should be
concentrated on pursuing downward adjustments.

Conclusion

Mr. Chairman and members of the Subcommittee on Human Resources, I want to thank
you for this opportunity to testify on behalf of the National Council of State Human
Service Administrators I know that I speak for my colleagues when I say that child
support enforcement plays a significant role in our efforts to increase family self-
sufficiency. Child support is a cornerstone of welfare reform and will be a major part of
the welfare reform plan being developed by our welfare reform task force Consistent and
timely child support payments can lead to a reduction in dependency on AFDC and
strengthen the role of both parents in providing for the emotional and financial well-being
of children.

Thank you again. I will be happy to answer any questions you have.

Chairman Ford. Thank you.
Mr. Wolf.

STATEMENT OF MARSHALL J. WOLF, CHAIR, SECTION ON
FAMILY LAW, AMERICAN BAR ASSOCIATION

Mr. Wolf. Thank you, Mr. Chairman, Mr. Santorum.

The American Bar Association appreciates the opportunity to
present its views to you on child support enforcement. The ABA is
a national organization composed of 360,000 attorneys. Unlike
many of the people you have heard here this morning, several of
us still do practice family law. I am chairman of the Family Law
Section of ABA.

Let me digress from my printed remarks, which the Chair has
indicated will be part of the record, and say simply what it is we
believe should be supported in the area of child support enforce-
ment, and that we believe should not be supported.

We believe that the tremendous recommendations of the U.S.
Commission on Interstate Child Support Enforcement should be
followed very carefully. At the insistence of the family law section
of the ABA, the House of Delegates of the American Bar Associa-
tion has endorsed the recommendations and proposals of the U.S.
Commission on Interstate Child Support Enforcement, and they did
so on a very strong position.

We believe that the elements of the commission's report deserve
the attention of Congress in order to get interstate child support
some more enforcement in this country.

What we also believe very, very strongly, however, is that inter-
state child support enforcement, while it certainly needs a tremen-
dous amount of work, does not need federalization.

As a matter of fact, for many, many reasons, federalization would
be contrary to the interests of those people who we represent. And
when I say who we represent, make no mistake: We represent both
the payers and the payees, the custodial parents and the
noncustodial parents. We see both ends of that problem. And we
believe it is that balance that we see that suggests why this would
not be a particularly good idea for federalization.

Let me suggest, first, that the key elements of the interstate
commission's report that should be addressed immediately are the
recommendation of the commission that we ensure uniform laws
and procedures in interstate cases by mandating that States and
territories enact verbatim the Uniform Interstate Family Support
Act, effective on a certain date.

One of the crucial changes within UIFSA is the elimination of
multiple valid support orders. If a client has a support order in
Ohio and it gets into the current URESA system, they very well
might have an equally valid but smaller support order in Ten-
nessee. That duality, that multiple system, cannot work, and it
never has.

Instead, under UIFSA, if there is only one valid support order,
and there are vehicles for enforcing that order across State lines,
we have have much more collectability of the proper amount of
support.

We, too, join in the recommendation that we amend the IRS W-
4 form for reporting of new hires for purposes of employment.

We also would urge the recommendation of the Commission that
requires employers to honor income withholding orders issued by
any State or territory. If I have an order in Ohio against a man
who is working in Ohio, but he is the only employee of his company
in Ohio that otherwise lives in Pennsylvania, I should be able to
enforce that order by simply placing tnat order against the Penn-
sylvania company.

Many companies will voluntarily comply with that, but we need
some degree of enforcement so that interstate orders can be adopt-
ed quickly in the sister State and thereupon enforced.

The remainder of the recommendations we went over are set
forth in my printed remarks, but I would like to turn to the other
question, and that is what should not be part of our system, and
that is the federalization.

Clearly there is an active debate today on whether child support
services would be improved by federalization, including the use of
Internal Revenue Service, Social Security, and Federal courts. The
ABA recommends Federal legislation to improve the system, but it
opposes the federalization.

The major problems from child support arise from inability to lo-
cate obligors and their assets, ineffective enforcement against self-
employed, and inadequate resources. Shifting the responsibility to
IRS will not solve any of these problems.

With respect to locating obligors, IRS only knows where some-
body is once a year. That is not going to help in finding obligors.
The States are more likely to find them with the use of motor reg-
istrations, professional licensing and things of that nature.

The IRS does a great job with the salaried people, but so do the
States. That is not where we are running into a problem. The
States are doing a pretty good job of getting salaried people to pay
child support. The problem is that according to IRS

Chairman Ford. Even across State lines?

Mr. Wolf. Better than if they were not salaried. But if we are
talking about this issue of a nonsalaried person, a person who is
self-employed, many of them don't even file tax returns. IRS isn't
going to find them.

Third, the resources needed would be incredible as far as addi-
tional manpower in IRS. Historically, Mr. Chairman, neither the
IRS nor the Federal courts nor the Justice Department in the area
of custody or interstate custody problems have done anything ex-
cept run away from family law problems. To place child support
within any part of the Feaeral Government, it will not get the at-
tention and the priority that it deserves, that it otherwise might
get from the States.

We had to bring the Justice Department kicking and screaming
to enforce the Parental Kidnapping Prevention Act. IRS is not
happy about helping us in child support, and they never have been.
The Federal courts have always avoided family law.

To suggest that by placing child support enforcement into a Fed-
eral system would be beneficial, I think ignores what we have seen
in the past.

One of the Members this morning, Mr. McDermott, mentioned
that because of no fault, you now have custody jurisdiction, custody
cases being tried more often. To federalize child support would

100

mean that you have to try these cases in two forums at the same
time: one in the Federal system, probably in front of IRS, and one
in the State court. It will take away from that State judge the op-
portunity to look at both of the parents and say, "Will you pay your
support?" and you will allow him to visit his child, or both of you
are in trouble. If you don't have that kind of synergy, you don't
have that kind of implied threat against both of them, then you are
going to run into more and more trouble on the visitation issue.

I see my time is up. I would be happy to answer questions.

[The prepared statement follows:]

101

TESTIMONY OF MARSHALL J. WOLF
AMERICAN BAR ASSOCIATION

Dear Mr. Chairman and Members of the Subcommittee:

The American Bar Association appreciates the opportunity to
present its views to you on child support enforcement. The ABA
is a national organization composed of 360,000 attorneys. I am
Marshall Wolf, Chairman of the ABA Section of Family Law.

The American Bar Association is committed to ensuring that
children receive needed financial support from their parents.
The nonpayment of child support has impacted drastically on too
many families in America. While gains have been made in dealing
with salaried individuals, increased mobility, and the increased
number of unmarried pregnancies add another element to litiga-
tion, both slowing down the whole system dramatically. The
problem crosses gender, racial and income lines.

The methods by which we establish and enforce child support
are tailored to a more static society and one in which the
nuclear family reigned supreme. Today the proportion of unmar-
ried pregnancies and the ability to travel from one side of the
continent to the other in eight hours or less, require that we
rethink the way we do business in enforcement of child support.
We need to meet this challenge without drastically changing the
way we deal with family problems, and we deal with them at the
state level. Powerful change is necessary to bring our state
system into what will be the 21st century. But radical changes
that ignore the efficiencies and client service aspect of the
present system would not do this. There is a way to meet this
need through the state-based system of litigating family law.

To address the problem, the U.S. Commission on Interstate
Child Support was mandated by the Family Support Act of 1988 to
make recommendations to Congress on improvements in the inter-
state establishment and enforcement of child support awards.
Its recommendations comprise the most significant blueprint for
comprehensive reform of child support since the passage of
Title IV-D of the Social Security Act, and the most extensive
revision of the rules of litigation of interstate support cases
since the adoption of the Uniform Reciprocal Enforcement of
Support Act (URESA) .

The report of the Interstate Child Support Commission is
based on two years of public hearings, research, debate and
analysis. The report comprises a thorough, careful analysis of
needed reforms in the child support system. Consequently, the
American Bar Association endorses the recommendations of the
U.S. Commission on Interstate Child Support to improve the in-
terstate establishment and enforcement of child support orders.
The ABA urges Congress to pass legislation and to give priority
to the following recommendation of the Interstate Commission:

1. Ensure uniform laws and procedures in interstate
cases by mandating that states and territories en-
act verbatim the Uniform Interstate Family Support
Act (UIFSA) , effective on a specific date. One of
the most crucial changes within UIFSA is the elimi-
nation of multiple, valid support orders that
currently exist under the Uniform Reciprocal En-
forcement of Support Act. Multiple orders lead to
terrible confusion regarding the calculation of
support arrears. Under UIFSA, there will only be
one valid support order governing the parties at
any point in time;

102

2 . Amend the IRS W-4 form for reporting exemption
claims to require new employees to report child
support obligations and payment through withhold-
ing, in order to expedite the location of obligors
and enforcement through income withholding;

3. Require employers to honor income withholding
orders/notices issued by any state or territory;

4. Establish a national computer network for the
exchange of information related to the establish-
ment, enforcement and modification of support
orders, and for the enforcement of visitation and
custody orders;

5. Establish minimum staffing standards for child
support agencies (IV-D agencies) ;

6. Provide training to child support caseworkers,
court administrators, private and public attorneys,
and judges involved in support cases;

7. Require states and territories to have laws and
procedures for civil voluntary parentage acknowl-
edgment; (The largest barrier for obtaining support
orders for nonmarital children is that paternity
must first be established. Further steps must be
taken to encourage fathers to take responsibility
for their children.)

8. Ensure that children receive adequate health care
coverage by mandating that the insurance industry
cooperate to provide coverage for all eligible
children, regardless of their residence or the
marital status of their parents;

9. Extend the availability of establishment and
enforcement remedies currently only available to
IV-D cases (handled by state and territory child
support agencies) to cases brought by private
attorneys on behalf of custodial parents and to pro
se parties;

10. Conduct a study to determine the reasons for
nonpayment of support; and

11. Strengthen enforcement remedies against the
self-employed .

The ABA opposes the federalization of child support
establishment, modification or enforcement, and supports
strengthening establishment, modification and enforcement
remedies through reform of the present state-based system.

We believe that greater uniformity within the child support
system and improved parent accessibility can and should occur
through reforms at the state level.

There is an active debate now about whether child support
services would be improved by "federalizing" the system, i.e.,
removing establishment, modification and enforcement
responsibilities from state courts and administrative agencies
and placing such activities within the responsibilities of the
Social Security Administration, the Internal Revenue Service,
and federal courts. The ABA recommends federal legislation to
improve the system by establishing W-4 reporting of new hires, a
national child support computer network, and state registries of
support orders. However, the ABA opposes "federalization" of
child support for a number of reasons.

103

The major problems in child support arise from the
inability to locate obligors and their assets, ineffective
enforcement against the self-employed, and inadequate resources.
Shifting support responsibilities to the IRS will not help solve
these problems.

1) Locating Obligors

Shifting child support responsibility to the IRS will not
enhance this process. With limited exception, the IRS
obtains address information from individuals only once a
year. However, states obtain address information much more
frequently: from quarterly wage reports to state employment
security commissions; applications for drivers licenses and
motor vehicle registrations; credit bureau reports, etc.
Legislation requiring the IRS to provide state child
support agencies with address and income information from
income tax returns would also enable states to have the
missing "locate" information they need.

2) Enforcement Against the Self-Employed

The use of the IRS as a collection agent may be effective
for obligors who are salaried. However, states already
collect such monies through income withholding. The IRS
would be picking up cases that the states are already
effectively handling. Use of the IRS would not necessarily
enhance enforcement against self-employed obligors. Ac-
cording to the IRS, an estimated 10 million individuals and
businesses to not file returns. About 64 percent of these
non-filers are self-employed individuals. Many of these
same individuals are likely to be self-employed obligors
who fail to pay child support.

If Congress acts on recommendations of the U.S. Commission
on Interstate Child Support — such as requiring states to
have laws regarding suspension of occupational licenses,
revocation of drivers licenses, and mandatory credit bureau
reporting — states will have the ability to more
effectively enforce support against the self-employed.

Strengthening the current IRS enforcement responsibilities
through the tax refund intercept and IRS full collection
processes would also be helpful.

3) Inadequate Resources

One reason for past poor state collection performance is
the lack of automation. Congress is investing millions of
dollars in the states for the development, by 1995, of
automated system. Congress should provide states the op-
portunity to "produce" as a result of this large federal
investment. Congress should also require the Secretary of
Health and Human Services to conduct state staffing studies
which will assist state child support agencies in obtaining
legislative approval for needed staff.

4) Lack of Federal Commitment

The experience of the U.S. Commission on Interstate Child
Support was that commitment to success made the difference
between successful and unsuccessful local efforts. The
practical experience of practitioners in the field is that,
at the federal level there is little commitment to family
law issues. These issues are regarded as state issues by
the federal courts. The Internal Revenue Service has
thrown up every barrier it can to the interception of tax
refunds and the expansion of that legislation. The FBI had
to have significant pressure placed upon it to take up the
investigation of parental violation of custody orders and

104

4) continued. . . .

parental abduction. There is little reason to believe that
this aspect of family law will receive more favorable
treatment.

In addition, the ABA has concerns that a federal child
support enforcement system would result in:

1) decreased accessibility to custodial parents
regarding location of child support services since
IRS and SSA offices are not in as many locales as
child support agencies and state trial courts;

2) decreased client service;

3) greater difficulty in tracking down the correct
obligee for disbursement of payments with limited
identifying information (particularly in light of
the fact that there are potentially at least 11
million child support orders with payments due
weekly, bimonthly or monthly) ;

4) potentially greater emphasis placed on AFDC cases
and recoupment of public expenditures than on
parentage establishment and non-AFDC cases;

5) dividing family law litigation between state and
federal forums, with spousal support, property
distribution, and custody being litigated at the
state level, creating a significant increase in
cost and multiplying the possibility of error;

6) the loss of innovation at the state level; and

7) tremendous added costs. For example, when the
Massachusetts Department of Revenue consolidated
support collection and disbursement functions, it
cost the state $111 per case and it took more than
four years to complete the process. The cost of
transferring cases from states to the federal
government, plus the cost of federal salaries,
could run into billions of dollars.

Rather than pay the massive cost for a federal system that
would mostly duplicate the current system, the ABA recommends
that Congress require greater uniformity of the best state laws
and practices within the child support system.

The ABA commends the Subcommittee for holding these impor-
tant oversight hearings. Thank you for permitting me to present
these views to you. I will be happy to answer any questions you
may have.

105

Chairman Ford. As a lawyer who practices in this area, are you
confronted with many of these cases?

Mr. Wolf. Yes. As a lawyer, and I practice

Chairman Ford. Visitation rights and all?

Mr. Wolf. Yes, and I am suggesting to you precisely that you
would take away a very effective tool to both me as a practitioner
counseling a client and to the trier of fact, a judge, who cannot say
to one, "Look, these" — as Representative Schroeder said this morn-
ing— "these rights are independent, but clearly they are inter-
twined. You are not going to trade off your right to visit the child
versus the right to pay support."

Family law is an area where there is a lot of discretion, but there
are two rules when a client walks into my office. If they are the
child support payer, they pay. Second, if they are the child custo-
dian, they better not interfere with visitation rights. Those are the
two rules. Beyond that, everything else goes.

But I think it is very important that we not eliminate from the
system the idea that one piece of this is going to be over here in
front of IRS.

First of all, there is not an IRS office in every county in this
country, that is for sure. It is going to be harder for a child support
recipient to utilize the services of IRS than it is to utilize their
local courthouse, their local child support enforcement agency. It
would be harder.

It will also be harder, and the question you ask me as a
practitioner

Chairman Ford. Do the courts use the IRS to collect child sup-
port across State lines?

Mr. Wolf. I don't see how procedurally that would be very effec-
tive. I think the bureaucratic chaos that would cause far exceeds
our desire for prompt, efficient, and expeditious exercise of enforce-
ment rights. I just don't see them in this situation.

If I may, Mr. Chairman, earlier this morning there was a lot of
discussion about bankruptcy, and I believe some of it was mis-
directed. Child support arrearages are not dischargeable in bank-
ruptcy.

The problem we run into is twofold: division of property under
a divorce declaration can be dischargeable, and the recipient, usu-
ally the wife, the custodial mother, doesn't care whether the money
she is about to get is child support or alimony or division of prop-
erty. She needs the money, cash. If you take a component of it and
discharge it in bankruptcy, oftentimes you will find that you are
then throwing her out of her house, you are increasing her poverty.

The second problem is that as soon as you have a bankruptcy fil-
ing under the present system, there is an automatic stay order in
the State courts, so that you can't enforce your child support order.
They can't discharge it, but you can't enforce it, because there is
an automatic stay, and until you get the bankruptcy court to re-
lease that automatic stay, you can't get the enforcement techniques
of the State court system.

I think that is truly what Representative Schroeder's bill should
be addressing, because there is not really a discharge of the child
support arrearage.

106

Chairman Ford. I think she stated that this morning, did she
not?

Mr. WoiJi'. I was unclear.

Chairman Ford. I thought in response to the questions coming
from one of the other members of the committee, I thought she
stated that. Maybe I didn't interpret it right.

I guess all litigation is on a State level, in the State courts, is
that correct? And if you federalized the program, would you still
have some real conflicts with State courts?

Mr. Wolf. Federal courts have historically run away from family
court issues. They don't want to have anything to do with it. It took
Congress to pass PKPA, and even then courts have very severely
restricted the interpretation.

The Federal district courts avoid family law matters wherever
they can.

Chairman Ford. Mr. Jackson, you mentioned that there was a
conflict of interest in States where a noncustodial parent requested
a downward modification in a child support order.

Mr. Jackson. I think that was Mr. Henry.

Chairman Ford. Was this you, Mr. Henry?

Mr. Henry. Yes.

Chairman Ford. Who do you suggest that the State represents?
Is it the child or the mother or the father, or the State?

Mr. Henry. There are a number of ways to approach the issue.
Some believe that the State is protecting the child through its re-
sponsibility to State government in trying to

Chairman Ford. This is opposed to the interests of the child.

Mr. Henry. Right. Others would argue that at least historically
in the IV-D program, the IV-D attorneys have been representing
the State and its taxpayers in an attempt to minimize public ex-
penditures on welfare.

As I said, there is an ABA ethics opinion that at least with re-
spect to families that are not currently on welfare indicates that
there is a traditional attorney-client relationship between the attor-
ney and the custodial parent, which produces difficulties for attor-
neys who are then being asked by Federal and State law to start
representing noncustodial parents in the same case.

Chairman Ford. Mr. Santorum.

Mr. Santorum. Thank you, Mr. Chairman.

Mr. Wolf, you were talking about visitation, and you heard the
question I asked Mrs. Schroeder earlier. Do you have any thoughts
about what role, if any, the Federal Government should take with
regard to visitation and particularly interstate visitation problems?

Mr. Wolf. Yes, sir. If one presumes that visitation is a compo-
nent of custody, and most courts consider it that, then in fact the
Federal Government has acted in that regard.

We might wish to look further into further strengthening the
PKPA, the Parental Kidnapping Prevention Act, which really
began as the Federal overlay to the Uniform Child Custody Juris-
diction Act, to avoid competing State interests in the area of cus-
tody and visitation.

But the very point that you make is one of the reasons why you
have to avoid the federalization. That is, even though the Federal
Government might by legislation assist the States in preventing

107

interstate battles over visitation, I think that is as far as the Fed-
eral Grovernment should go in the area that is uniquely State
based. And once you do that, if you then federalize the child sup-
port issue, but leave the custody and visitation issue in the State
system, you are then creating this duality that really will make it
a very difTicult, if not impossible task to address the issues to-
gether.

Mr. Santorum. Are there any specific suggestions you would
have as to how to address the visitation problem? Number one,
would you suggest something in a child support enforcement bill
discussing visitation, or would you do something in a separate bill?

Mr. Wolf. I think it would be best served to be treated on its
own and address that question head on. The thing you could prob-
ably do is to mandate the States to give full faith and credit to the
visitation orders of sister States.

Once you can easily register a foreign custody or visitation dec-
laration in a sister State, and then get enforcement without the sis-
ter State then relitigating it in favor of their home State parent,
I think that is all you really need to do.

Mr. Santorum. How would you feel about that, Mr. Jackson?

Mr. Jackson. I would agree with that.

Mr. Santorum. Anyone else have any comments on that?

Mr. Grubbs. The only comment I have is that currently IV-D
agencies are precluded from being involved in any type of visitation
enforcement. You also cannot use IV-D funding for any kind of vis-
itation dispute resolution or anything else.

There may be some situations out there where States might like
to have a little more flexibility to deal with the issue when they
see that it may in fact work to help induce child support enforce-
ment. Plus, there are also some other entities, and I certainly know
in the case of Texas where some other non-IV-D governmental en-
tities, like Friends of the Court and domestic relations offices, have
in fact taken on visitation issues. And there might be ways that
you could encourage a little more of that kind of activity outside
of the IV-D system.

Mr. Santorum. Since you were talking, Mr. Grubbs, I will turn
to you. You mentioned in your testimony that there are private
agencies that could assist in this problem. Could you detail what
you mean by that and what we can do here on the legislative front
to facilitate that participation?

Mr. Grubbs. I would be happy to. There are currently some very
interesting projects going on around the country involving the pri-
vate sector. When I say that I am talking both in terms of some
f)rivate companies, as well as the private bar, and even at the local
evel, some non-IV-D governmental entities, like I said. Friends of
the Court or domestic relations ofTices. I think they could all be in-
volved to a much greater extent in helping solve the child support
problem.

The Chairman's home state, Tennessee, is actually in the fore-
front of some of these privatization initiatives. Their IV-D program
in some counties is actually turned over to private firms that nave
established some pretty amazing track records in improving the

f»erformance of establishment and enforcement of child support ob-
igations.

108

There also is a pilot project getting ready to begin in Dallas, Tex.
A private firm, Maximus, that does a lot of different government-
type contracting work, is likely to be awarded a contract by the
family law judges in Dallas County to set up a program that I con-
tinue to insist is going to be the most fundamental way we can im-
prove child support. And that is, beginning on a certain date, all
judges in Dallas County will put every new child support order
onto a system by which payment is monitored, and at the first de-
linquency, within 10 days, immediately instigate enforcement of
those orders.

It is not going to use Federal, State, or county dollars. It will be
paid for by a $10 a month fee imposed on the noncustodial parent.
This particular company is basically going to take on the respon-
sibility for all of those new orders being issued in Dallas County.

If tnat is successful and if it proves somewhat marginally profit-
able, as hopefully it will, you could see that kind of thing repeated
all over the country. There is no reason that couldn't occur in other
places. And for every one of those cases you keep out of the IV-
D system it means your existing FV-D agencies can do much more
to serve the current backlog of cases.

Mr. Santorum. I appreciate your comments about what is going
on and what can happen. My question was, is there anything that
we need to do legislatively to facilitate what you are discussing, or
are these things going to be happening whether we do something
or not, or are there things in current law that are barring partici-
pation from other sources to help this process along?

Mr. Grubbs. I would suggest going back and looking at all of the
provisions of the 1984 and 1988 acts relating to the IV-D program
and all pending legislation, such as Senator Bradley's bill to imple-
ment the recommendations of the Interstate Commission, and look
to see if the IV-D agency is the only entity that should be allowed
to use the tools identified in there.

What we did in Texas was very much along that line. We had
reserved certain State enforcement tools only to the IV-D agency.
An example of that is our State law on administrative wage with-
holding. This had been reserved for the IV-D agency, but we
opened that up and private attorneys are having a field day in
using that tool to go out and impose wage withholding orders on
delinquent obligors.

Mr. Santorum. Let me request that if you have done that al-
ready, we would appreciate any information you have as to things
we can do here on the Federal level.

Mr. Grubbs. I would be pleased to do that.

Mr. Santorum. Thank you.

[The following was subsequently received:]

109

ouncil

Nalionil Hcadquancn Wuhinglon. DC Officr Wc5l Regional Offlcr

J6I6 Far Wnl Blvd 2000 L SlrMl. NW 2330 Buuno Dnvt

Suilc 101151 Suiw 402 Sacramento. CA 95825

Austin. TX 78731 Washington. DC 20036 (916)184-4126

(512) 860-2279 (202) 7287534
(512) 343-0060: fax

July 30, 1993

The Honorable Rick Santorum, M.C.
Ranking Minority

Subcommittee on Human Resources
U.S- House Ways and Means Committee
122 Longworth House Office Building
Washington, D.C. 20515

Dear Mr. Santorum,

During my testimony before the Subcommittee on Human Resources on June 10, I was asked
to provide some information about specific legislation that could increase the role of the
private sector in child support enforcement.

Attached are several recommendations to address problems brought to my attention that have
proven to be barriers to or have otherwise limited the role of private businesses involved in
child support enforcement.

Please let me know if you need more information or if I can be of further assistance. Again,
thank you for the opportunity to testify and share the Child Support Council's ideas about
ways to improve the child support program.

Darryll W. Grubbs
President

cc: Members of the Subcommittee on Human Resources

110

National Headquarters Washington, DC Office West ftegional Office

3516 Fat West Blvd 2000 L Stteet, NW 2330 Buuno Drive

Suite 101 151 Suite 402 Sacramento CA 95825

Austin, TX 78731 Washington, DC 20036 (916)484-4126

(512) 860-2279 (202) 728-7534
(512) 343-0060 fax

CHILD SUPPORT LEGISLATION: 103RD CONGRESS

(1) Amend the federal Fair Debt Collection Practices Act to clarify that the provisions of the
Act shall not apply to the collection of court-ordered child support.

(COMMENT: Despite letters of clarification by the Federal Trade Commission that the
FDCPA does not apply to collection of court-ordered child supjwrt, several states have
threatened legal action against private child support collection agencies for non-compliance
with provisions of this Act. The application of the provisions of the FDCPA to child support
collections is frustrating the national effort to encourage new and legitimate child support
collection businesses as an alternative to overworked and backlogged government child
support enforcement agencies.)

(2) Amend Title IV-D of the Social Security Act to require states to have laws for the
establishment of paternity in Title IV-D cases through DNA testing of not just blood but also
saliva and other bodily tissues and fluids.

(COMMENT: State parentage establishment laws are failing to keep place with technological
changes in testing. Some states still fail to recognize the results of DNA testing in parentage
establishment. Some of those that do permit DNA testing may allow only testing of blood,
although new technology now permits conclusive DNA test results from saliva and other
bodily tissue and fluid. The failure of states to keep their parentage establishment laws
current is slowing down efforts to increase the rate of parentage establishment for child
support enforcement.)

(3) Amend Title IV-D to specifically prohibit IV-D child support enforcement agencies from
denying or terminating IV-D services to clients who fail to terminate agreements for
enforcement services by private attorneys, county domestic relations offices, guardians ad
litem, private child support collectors, or other entities assisting the client in enforcing a
child support obligation.

(COMMENT: Despite federal advisory opinions issued to state IV-D agencies that they
should not terminate IV-D services to a client simply because she is also using enforcement
services provided by other public and private enforcement entities, states are continuing to
terminate or threatening to terminate client cases under these circumstances. Federal law in
this area needs to be made clear and absolute.)

(4) Amend the provisions of Title IV-D requiring states to begin immediate wage withholding
(IWW) in both IV-D and non-IV-D cases (by January 1, 1994) to permit the IV-D agency or
other public entity that is required to monitor and enforce the wage withholding order in non-
IV-D cases to charge a minimal fee (not to exceed $10 per month) against the non-custodial
parent for costs associated with this activity. If the IV-D agency is providing the service,
income from these fees shall not be considered program income for the purpose of federal
IV-D funding.

Ill

(COMMENT: Implementation of these "universal" IWW provisions is causing great concern
among state IV-D agencies as federal funds are not available for enforcing IWW in non-IV-D
cases, although federal law requires states to implement this activity subject to loss of federal
IV-D funds. Permitting a small fee to be charged against the NCP for monitoring and
ensuring compliance with the IWW order would provide a source of funding for this
activity.)

(5) Amend Title IV-D to authorize a custodial parent or a collection entity (attorney,
domestic relations office, guardian ad litem, or private collector) acting on her behalf to
submit a case to the IV-D agency for inclusion in the IRS income tax refund intercept
program (and upon payment of a minimal fee) without having to apply for full IV-D
services.

(COMMENT: By permitting access to certain valuable IV-D enforcement tools without the
necessity of first applying for full IV-D services, custodial parents can obtain some of the
major enforcement benefits of the IV-D program without adding to the caseloads of already
overwhelmed IV-D agencies.)

(6) State agencies (employment, driver licensing, professional and occupational licensing,
public utility, revenue, and others) must make available upon request by any state's IV-D
agency certain information that may assist the IV-D agency in locating an absent parent for
enforcement of a delinquent child supf)ort obligation, including providing the IV-D agency
with a magnetic tape containing the names, addresses, dates of birth, and social security
numbers of all individuals for whom files or records are maintained by the state agency.

(COMMENT: Failure to locate absent parents to establish or enforce child support orders is
the number one reason state IV-D agencies fail federal audits, yet some key state government
agencies [including employment agencies that are 100% federally funded] continue to deny
state IV-D agencies access to records and information that may lead to locating delinquent
child support obligors. State agencies should be mandated to provide this information,
including magnetic tapes containing names, addresses, dates of birth and social security
numbers to any state IV-D agency upon request and with appropriate assurances that it will
be used only for this limited purpose.)

(7) Title IV-D should be amended to extend the October 1995 deadline by which all state IV-
D agencies are required to have new automated case management systems fully operational.
Enhanced federal funding (90%) for these new systems should be continued until they are
fully operational.

(COMMENT: Automating the management of child support cases by IV-D agencies is on of
the fundamental ways that IV-D agencies will be able to manage their growing caseloads
more efficiently and effectively. Unfortunately, many states are unlikely to complete these
new systems before the 1995 deadline. Rushing to complete the design and development of
these systems will only result in problems and inadequacies when they become operational.
The deadline must be extended and states given the necessary time to complete the design
and implementation of well-planned and -built systems.)

112

Mr. Santorum. One additional question on child support assur-
ance. Mr. Jackson, you mentioned the APWA is in favor of it.

Does anybody have any comments about that?

Mr. Wolf. The American Bar Association did not take a specific
position on child assurance. However, to the extent that the U.S.
commission generally did not favor a Federal child support assur-
ance program at this time, we would concur. We don't believe that
that would be the appropriate way to go at this time.

Mr. Jackson. To clarify, Mr. Santorum, Mr. Chairman, our asso-
ciation indicated we favor demonstrations in this this area.

Mr. Wolf. State based?

Mr. Jackson. State-based demonstrations.

Mr. Grubbs. My personal feehng is demonstration projects are a
fine way to try this. I think the underlying issue, though, that is
raised is, if you have a system that effectively enforces child sup-
port, do you need to provide child support assurance to everyone?

I think that an objective of child support assurance is when you
combine child support payment, AFDC, and child support assur-
ance, the objective seems to be to guarantee a minimum level of in-
come. If that is what the objective is, that ought to be what is on
the table. Because the IV-D program has been strapped with a $50
disregard, which is the reason that the Federal deficit you were
asking about earlier, that is part of the reason the Federal deficit
is there, because the second they impose the $50 disregard, that
adds to the cost of the IV-D program.

The same thing will occur with child support assurance. But I
think child support assurance should be provided. But once the
child support program has said basically there is nothing more we
can possibly do to help this family, then I think that is govern-
ment's responsibility.

Mr. Henry. The National Child Support Enforcement Association
supports child support demonstration projects at the State and
local level. One thing I would recommend, though, is demonstration
projects be sufficiently funded and sufficiently long term to test
some of the basic goals we are trying to reach, which in addition
to helping kids and relieve childhood poverty, we are trying to fig-
ure out whether the availability of the assured benefit will cause
custodial parents to leave the welfare rolls. They need to know the
assured benefit payment is going to be there for a number of
months or years before they make a rational decision to leave the
status quo.

The other thing we are trying to test is whether the requirement
that is in most of these proposals, that a support order be in place
as an eligibility requirement for the assured benefit requirement,
whether the payment itself will increase cooperation from welfare
recipients. Again, I think you need a fairly long-term demonstra-
tion project if we are going to test that assumption.

Mr. Santorum. Thank you.

I do have one additional question for Mr. Jackson. The Commis-
sion recommendation about setting up these information systems
by building on the current system W-4 is that something you feel
the States can do to reform the interstate system?

Mr. Jackson. Filing of the W-4?

113

Mr. Santorum. Can the States put together a system of checking
across State Hnes based on a W-4 form? If someone files a new hire
and some State files a W-4 form, it obviously would be transmitted
to some State agency, and you would have to have some system
where other States can check to discover whether there is a child
support order out there.

Is that something that would be welcomed by the State, or is this
an additional burden that the State doesn't necessarily want to
take on?

Mr. Jackson. I think with the proper legislation, if I understand
the question correctly, I think, yes, the States would welcome it.
Part of the problem, again, going back to the whole locate business,
and the need for a national system that helps locate absent par-
ents. It is not on line yet.

One project is going on in the southeast part of the State, includ-
ing Virginia and South Carolina, but there is no national effort
under way right now to develop a national locate system. If you are
going to do the W-4 thing on an interstate basis, you are going to
have to have some kind of a system to make that work as well.

In Virginia it is only going to be applicable to those Virginia em-
ployers and employees. There is no way we can enforce that across
State lines at the present time.

If we are serious about taking care of the customer that we are
serving, and if those customers nave to be served because of people
who go across State lines, we have to figure out what the systems
are going to be. There is no question that they can be figured out.
The question is how it will be done.

Mr. Wolf. I believe that is one of the recommendations of the
commission, that there be sufficient funding so the State systems
can link with each other, at least by computer.

Mr. Santorum. Thank you, Mr. Chairman.

Chairman Ford. I thank the panelists for coming and waiting so
patiently. Thank you for your input. We really do appreciate it.

I would like to call our next panel: Margaret Campbell Haynes,
former Chair, U.S. Commission on Interstate Child Support, direc-
tor, Child Support Project, Center on Children and the Law, Amer-
ican Bar Association; Michael Infranco, City of New York, deputy
Commissioner of child support enforcement. Human Resources Ad-
ministration; Robert Melia, director of strategic planning. Child
Support Enforcement Division, Massachusetts Department of Reve-
nue; Robert Williamson, American Society for Payroll Management.

Ms. Haynes.

STATEMENT OF MARGARET CAMPBELL HAYNES, FORMER
CHAIR, U.S. COMMISSION ON INTERSTATE CHILD SUPPORT;
AND DIRECTOR, CHILD SUPPORT PROJECT, CENTER ON
CHILDREN AND THE LAW, AMERICAN BAR ASSOCIATION

Ms. Hayn1':s. Thank, you Mr. Chairman. My name is Margaret
Campbell Haynes. I am testifying as former Chair of the U.S. Com-
mission on Interstate Child Support.

I hate to begin with an apology, but my secretary prepared copies
of my testimony while I was out of town. I have discovered here
that the pages are misnumbered and I will give you corrected cop-
ies of the testimony later.

114

As you know, one of the debates going on is whether part or all
of the child support system should be federalized. The so-called
Downey-Hyde proposal has stimulated discussion and thoughtful
analysis throughout the country, and I think the debate has been
veiy healthy.

Having said that, let me highlight a fundamental conclusion of
the U.S. Commission on Interstate Child Support. After 2V2 years
of public hearings throughout the country, a National Leadership
Conference on Child Support, and countless hours of deliberations,
we concluded that federalization was not the cure-all for child sup-
port problems.

On the surface it is very attractive to say let's collect child sup-
port like we collect taxes. If you look at the problems of child sup-
port, however, federalizing enforcement collection and distribution
with the IRS will not improve the situation.

Mr. Wolf has already addressed how States have much more ac-
curate address information than the IRS. He also pointed out the
problems with enforcement against the self-employed, which IRS
also has problems with.

The Commission makes a number of of recommendations geared
toward the self-employed that will improve State performance in
that area. A number of States are acting on those recommenda-
tions. And I think we could also do more to strengthen current IRS
enforcement responsibilities through the tax onset and full IRS
collection.

We were concerned about issues of accessibility if you federalize;
local child support agencies and State trial courts are located in
many more locales than IRS and Social Security offices.

I also submit that an IRS agent is not going to be as responsive
to a custodial parent calling up asking for case status as a local
child support worker would be.

We were concerned about prompt distribution of payment. Right
now many child support payments are made through money orders.
They come in with missing or improper identification that requires
a manual search. And we were concerned that there is no existing
model for prompt Federal distribution of up to 10 million weekly
child support payments, especially payments which change depend-
ing upon the parties' circumstances and custodial arrangements.

Finally, we were concerned about the tremendous cost of dupli-
cating at the Federal level what already exists at the State level.

The one thing the IRS has that the States don't is income infor-
mation. We urge Congress to require IRS to provide support agen-
cies with that income information. It is not necessary to create a
whole new system.

We were convinced that the most effective reform was with
greater uniformity of laws and procedures at the State level backed
by adequate resources. Once you get past that federalization issue,
there is a lot of agreement among the Downey-Hyde proposal, the
report of the U.S. Commission, and the administration's proposals.

All of them speak of the importance of a national computer net-
work based on linkages of existing state automated child support
systems and the Federal parent locate service or CSENet.

All support employer reporting of new hires and direct income
withholding. The Congressional Budget Office estimated that the

115

Commission's recommendation of nationwide W-4 reporting would
cost $55 million yet result in $210 million in increased collections.
The Commission recommends that employer reporting should be to
a central State location to ensure immediate State access to that
data and the ability of the state child support agency to monitor
employer compliance.

All proposals also support registries of support orders. Again, the
Commission recommends that such registries be maintained at the
State level. It is essential that States have information on orders
in order to comply with the review and adjustment requirements
Congress has already mandated.

Obviously, having State registries would not foreclose the possi-
bility of a national registry of abstracted support order information.

All of the proposals emphasize the need for improved paternity
establishment. We urge Congress to require States to have expe-
dited procedures for paternity establishment just like they are now
required for establishment and enforcement. And these should in-
clude hospital-parent outreach, civil voluntary acknowledgments,
and presumptions based on genetic test results.

Finally, all of the proposals emphasize the need for health care
reform. We have a number of comprehensive recommendations. I
urge Congress to look at the ERISA preemption which currently
prohibits States from prohibiting discrimination in dependency cov-
erage which now exists in self-insured plans.

Let me conclude by urging Congress not to neglect the need for
resources at the State level. That is one thing that you will hear
a lot about today. You can have the best laws in the country, you
can have the most comprehensive automated child support sys-
tems, but they are never going to eliminate the need for trained
child support workers to handle the complex cases and to provide
customer service. The current child support case load is 1,000 per
full time employee, and that is just staggering.

The Commission urges Congress to require the Secretary of HHS
to conduct State staffing studies, and then require the States to
comply with them.

I commend you, Mr. Chairman, for focusing on children's finan-
cial needs. It is important what we have that commitment from the
top to make our system improve.

Thank you.

[The prepared statement follows:]

116

STATEMENT OF MARGARET CAMPBELL EAYNES, CHAIR

U.S. COMMISSION ON INTERSTATE CHILD SUPPORT

before

SUBCOMMITTEE ON HUMAN RESOURCES

WAYS AND MEANS COMMITTEE

U.S. HOUSE OF REPRESENTATIVES

March 18, 1993

Good morning, Mr. Chairman, and members of the Subcommittee. Thank
you for this opportunity to comment on various propo£.als for reform
of the child support system. My name is Margaret Campbell Haynes.
I am testifying as the former Chair of the U.S. Commission on
Interstate Child Support .

Congress created the Commission in 1988 to recommend improvements
to the interstate establishment and enforcement of child support
orders. In focusing on the need for interstate reform. Congress
recognized the hurdles a custodial parent and child face in
collecting support when they live in a different state from the
noncustodial parent. For example, mothers in intrastate child
support cases reported receiving 70 percent of the support they
expected during 1989. Yet mothers in interstate cases reported
receiving only 60 percent of the support owed them in 1989; and
mothers who did not know the location of the father reported
receiving only 37 percent of what was expected.^

The 15 members of the Commission represented various participants
in the child support system, including three members of Congress:
Senator Bill Bradley (D-NJ) , Congresswoman Barbara Kennelly (D-CT) ,
and Congresswoman Marge Roukema (R-NJ) . We spent 2 1/2 years
holding public hearings across the country, examining the problems
and developing recommendations. In August 1992 we issued our
report to Congress .

I. Child Support Enforcement and Assurance Proposal

Despite improvements in recent years, the interstate child support
system remains one plagued by a lack of uniformity in state laws,
policies, and procedures; insufficient locate information;
inadequate enforcement remedies, particularly against the self-
employed; inadequate resources; multiple, often conflicting,
support orders between parties; and a lack of communication among
the states. In response to such a dismal picture, former
Congressman Downey and Congressman Hyde proposed a revolutionary
reform of the child support system. The proposal would federalize
modification, enforcement, collection and distribution of child
support .

The U.S. Commission on Interstate Child Support also considered
whether reform of the child support system required federalization
of some or all of the services now provided by state courts and
child support agencies. While there are some advantages to a
federal system, all but one Commission member felt that there were
serious concerns that weighed heavily against such an overhaul .

^ U.S. General Accounting Office, Interstate Child Support:
Mothers Report Receiving Less Support from Out-of-state Fathers.
HRD-92-39FS ( Washington, DC: Gov't Printing Of f ice 1992), pp. 16-
18.

117

Shifting child support responsibility to the IRS will not enhance
locate. The IRS usually obtains address information from
individuals once a year. State sources of information -- such as
the Department of Motor Vehicles, credit bureau reports, quarterly
wage statements -- are much more current. Nor will the IRS
necessarily increase enforcement against self-employed obligors.
According to the IRS, an estimated 10 million individuals and
businesses do not file returns. About 64 percent of these
nonfilers are self-employed. State remedies such as revocation of
occupational licenses, mandatory credit bureau reporting, liens on
property, and attachment of lump sum payouts are more likely to
increase enforcement from self-employed obligors.

A federalized system will not improve accessibility to custodial
parents. In fact, the Commission was fearful that accessibility
would be decreased since IRS and Social Security offices are not
located in as many locales as local state trial courts and child
support agencies. Based on testimony from states such as
Massachusetts, the Commission concluded that a federal system would
also result in greater difficulty in tracking down the correct
obligee for disbursement of payments where there is limited case
information. We were concerned that there is no existing model for
prompt federal distribution of potentially at least 11 million
weekly child support payments, payment amounts which may change
monthly depending upon parties' financial circumstances and custody
arrangements. The Commission did not think that fragmenting a
family law case between state courts and federal agencies was in a
child's best interest. Finally, the Commission was concerned about
the tremendous costs of duplicating at the federal level what
already exists at the state level, especially when most states are
just beginning to benefit from Congress' investment in state
automation.

The Commission therefore opposes federalization of child support.
Rather it recommends that Congress require greater uniformity
within the state-based child support system.

Within such a system, the Commission wholeheartedly endorses the
child support enforcement and assurance proposal's emphasis on the
need for nonadversarial paternity procedures. The Commission
strongly supports hospital parentage acknowledgment procedures,
civil parentage acknowledgment proceduresat any point during the
child's minority, and creation of a rebuttable presumption of
parentage based on genetic test results.

With regard to establishment of a support order, the Commission
recommends the creation of a National Child Support Guidelines
Commission. However, the Commission disagrees with Congressmen
Downey and Hyde that a national guideline should be based on the
Income Shares model. Currently, states tend to use one of three
guideline models: the percentage of income, such as used in
Wisconsin; the income shares, such as used in Colorado; and the
Melson formula such as used in Delaware. Since no guideline
perfectly addresses every fact situation, especially multiple
family issues, the Commission recommends that the Guidelines
Commission review all existing guideline models. The Commission
should study their strengths and weaknesses and determine needed
improvements. Any resulting national guideline may include best
features from each current guideline model .

The child support enforcement and assurance proposal envisions
nationwide implementation of child support assurance. Also
referred to as child support insurance, the proposal is that the
government would guarantee a yearly minimum support amount based on
the number of children in a single-parent household. If the
obligor failed to provide support in the amount of the insured
benefit, the government would provide the family with the
difference between the insured benefit and the ordered support.
The benefit ensures that custodial parents have some level of
financial stability without regard to the obligor's payment
pattern.

118

Although early results from New York's CAP is promising, the
Commission believes that additional information regarding the
feasibility and effectiveness of child support insurance is needed.
The Commission supports state demonstration projects on child
support insurance. Based on an evaluation of these demonstrations,
Congress should then decide whether to implement child support
insurance nationwide.

With regard to collection and enforcement, I am pleased that the
Downey-Hyde proposal endorses the cornerstones of the Interstate
Commission's reform: registries of support orders, a national
computer network that links certain federal and state automated
systems for child support purposes, employer reporting of new hires
through use of the W4 form, and direct income withholding.

II. Report of the U.S. Commission on Interstate Child Support

A. Registry of Support Orders

To facilitate enforcement, the Commission recommends that Congress
require every state to establish a Registry of Support Orders.
Commissioners envisioned that the state IV-D office would serve as
the registry since that office already maintains data on IV-D
orders. In non-IV-D cases, the Registry would store an abstract of
case information; but not perform collection, accounting,
disbursement or enforcement services.

It is crucial that such registries be maintained at the state
level. States need information about child support orders in order
to fulfil the review and adjustment mandates of the Family Support
Act of 1988. As long as states continue to provide child support
services, we must ensure that they have the resources to perform
the job effectively.

However, Congress may wish to consider an addition to the
Commission's recommendation. In my personal opinion, it may be
useful to also have a national registry of support order abstracts.
This national registry would not duplicate or replace state
registries. Rather, it would serve a "pointer" function. A state
seeking information about outstanding support orders on a
particular obligor could use the national network described below
to query what other states had outstanding support orders. The
national registry of order abstracts would have the miminum
information -- names of parties, social security numbers, and
state (s) that have issued an order -- needed to then direct
specific requests to the appropriate states.

B. National Computer Network

"In a day of electronics where computers replace humans in every
business, the child support system stands as a dinosaur fed by
paper. "^ The Commission recommends that Congress expand the
Federal Parent Locate Service to create a national locate network.
Commissioners do not envision a national data bank but linkages
among statewide automated child support systems and between state
systems and federal parent locate resources. Through the network,
child support agencies and attorneys could obtain address, income,
and support order information for child support purposes

The network would allow states to direct locate requests to a
particular state or to broadcast the request nationwide. State
data bases which should be accessible include publicly regulated
utilities, employment records, vital statistics, motor vehicles,
taxes, crime and corrections. When a targeted state is unable to
locate the person, the expanded FPLS would also be able to
automatically reroute the request to other states, based on
Department of Labor studies of migration patterns. Based on the
success of NLETS (National Law Enforcement Telecommunications

^ Supporting Our Children: A Blueprint for Reform (U.S.
Commission on Interstate Child Support (1992) .

119

Network) , the Commission recommends a mandated 48-hour turnaround
time for processing information requests.

C. W-4 Reporting of New Hires

All states now enforce child support orders through income
withholding. Studies show, however, that in interstate cases there
is an average of thirteen to twenty weeks between location of an
obligor's source of income and service of the withholding order on
the out-of-state employer.' During the delay, the obligor may move
to new employment .

To ensure the availability of the most current employment
information on obligors, the Commission recommends amendment of the
W-4 form for reporting new hires. The amended form would have
boxes for the employee to indicate the existence of a support
order, the amount of such order and the payee, the existence of an
income withholding order, and the availability of employer-provided
health insurance.

The Commission further recommends that the employer send a copy of
the W-4 information to the state Employment Security Commission
(ESC) . The Commission recommended reporting to the ESC in part
because employers are familiar with reporting wage information to
that entity. The employer would be required to begin withholding
immediately if the employee indicated the existence of an income
withholding order.

The state IV-D agency, through an automated interface with the
Employment Security Commission, would match orders in its Registry
of Support Orders against the W-4 information. The IV-D agency
would also broadcast the information nationwide through the
computer network. If there was a match with an order maintained on
any state's registry, the appropriate state agency (or person in
non-IV-D cases) would send a federally designed income withholding
notice or order directly to the employer. The withholding notice
would confirm or correct the information supplied by the employee.
Any employee supplying false information would be subject to
criminal penalties.

To further facilitate income withholding, the Commission recommends
that Congress establish a universal definition of income subject to
withholding, a uniform ceiling on the amount of income that can be
garnished for support, uniform standards for the time within which
employers must forward the W-4 information (10 working days is
suggested) , and uniform standards regarding priority of
withholdings when an obligor is subject to several state
withholding orders and lacks sufficient income to meet all of them.

The Congressional Budget Office estimated that the Commission's
recommendation would cost $55 million to implement nationwide, and
result in $210 million of increased support collections.

I am pleased to report that at least 10 states* have now enacted
W-4 reporting and legislation is pending in several other states.
Based on state experience with W-4 reporting and further
discussions with employer groups, I would like to offer the
following personal suggestions which slightly modify the
Commission's recommendations.

1. Obligors often do not know correct information about their
support orders or to whom payments should be forwarded. Therefore,
to require the employee to provide such information on an amended
W-4 form means there will often be misinformation. The

' U.S. General Accounting Office, Interstate Child .qupDort :
Wage Withholding Not Fulfilling Expectations, HRD-92-65BR (1992) .

* Alaska, California, Georgia, Hawaii, Iowa, Massachusetts,
Minnesota, Virginia, the State of Washington, and West Virginia.

120

H^^t!?^°'^t^v,^'^"..^^''u"'^^.P''°^^^"'^^^^ ^f employers are required to
begin withholding based on the faulty info^ation prior to any
lr.1^ T^^°''\ P^y^^"ts may be sent to the wrong location and the
goal of prompt receipt of support by the obligee frustrated

What is most crucial about the W-4 reporting is the employer
address information. I therefore suggest that the W-4 form be
amended to only solicit information about the availability of
employer-provided health insurance. It is not necessary to include
information about support terms. Such information will be gained
when the W-4 data is matched against the state registry of support
orders and broadcast through the national network.

To avoid confusion, I also recommend that employers not be required
to implement income withholding until they have received the
federal income withholding notice/order. That ensures accurate
withholding.

Finally, I recommend that federal legislation provide the employers
with flexibility in how the W-4 information is transmitted. For
example, state laws often allow transmission of the data through
mailing a copy of the W-4 form, faxing the information, or
electronically transmitting the information.

2. Congress may also want to explore whether the state child
support agency is the more appropriate entity to receive the W-4
information. One advantages is that the state IV-D agency is also
most likely to be the registry of support orders. It would also
ensure there is a state office monitoring compliance with the W-4
reporting that has a vested interest in improving child support
enforcement. On the other hand, the disadvantage of reporting the
information to the state IV-D agency is that the agency may be
overwhelmed by receipt of W-4 information for employees on whom
there is no IV-D order.

3. States should not be required to store the W-4 information
indefinitely. It may be appropriate to require retention of the W-
4 information for three months after its receipt. At that time,
the information should be appearing on wage reports from the state
employment security commission. There is no reason to maintain
duplicate data banks.

4. Congress and the states need to educate the public that W-4
reporting will not only greatly facilitate income withholding. It
will also provide valuable locate information. For that reason,
the employer reporting of new hires should not be tied into payroll
periods but to a set period from the point of hire .

D. Direct Income Withholding

In 1984 Congress required states to make income withholding
available as an enforcement tool in interstate cases. An agency or
attorney sends an interstate income withholding request to the
state where the obligor derives income. That second state provides
the obligor notice and an opportunity to contest. Child support is
usually forwarded from the out-of-state employer to a collection
point in the employer's state, then to a collection point in the
custodial parent's state, and then finally to the custodial parent.

A number of child support agencies report success in sending an
income withholding request directly to the out-of-state employer,
despite lack of jurisdiction over the employer. In fact, GAO found
that 75 percent of employers comply with a direct withholding
request.' The Commission recommends that Congress legalize what
appears to be working and require states to have laws that require
an employer doing business in the state to honor an income
withholding order or notice sent directly from any state.

In addition to the above recommendations, the Commission identified

* Wage Withholding Not Fulfilling Expectations, supra.

121

a core set of recommendations which we also feel are crucial to any
reform of the child support system.

E. Revision of URESA

Congress specifically required the Commission to make
recommendations regarding the Uniform Reciprocal Enforcement of
Support Act (URESA) . The Commission worked very closely with the
National Conference of Commissioners on Uniform State Laws
(NCCUSL) , the drafters of the original URESA. The result of that
cooperation is a new act called the Uniform Interstate Family
Support Act. UIFSA was officially approved by NCCUSL in August
1992, and by the American Bar Association in February 1993.

UIFSA contains a number of provisions that implement key
recommendations of the Commission. For example, UIFSA contains a
broad long arm statute that, within the confines of Supreme Court
decisions, expands the opportunity for a case to be heard where the
custodial parent and child reside. In addition, UIFSA contains
provisions implementing direct income withholding and easing
evidentiary rules in interstate cases, and allowing use of
telephonic hearings.

One of the most major revisions to URESA is adoption of the "one
order, one time" principle. Currently under the Act, a URESA order
exists independently from any other support order.' That means
that several conflicting support orders governing the same parties
and child can exist at the same time. To achieve "one order, one
time," UIFSA creates priorities to establish or modify a support
order involving the same parties and child (ren) .

The changes to URESA can greatly improve the interstate
establishment and enforcement of support orders by providing
uniformity in the law if all states adopt UIFSA without
modification. The Commission therefore recommends that Congress
require states to adopt the Uniform Interstate Family Support Act
verbatim, effective as of a particular date. I am pleased to
inform you that six states have already enacted UIFSA: Arizona,
Arkansas, Colorado, Montana, Texas, and the State of Washington.

F. Determination of Parentage

The Commission found that many states unnecessarily stress
adversarial procedures for parentage determination. The Commission
agrees with the Downey-Hyde proposal that states should first
pursue voluntary parentage acknowledgments. The Commission also
agrees with the proposal and the Administration regarding the
importance of early paternity establishment. The Commission
strongly supports hospital outreach programs such as those used
successfully in Washington and Virginia. In 1991 Washington was
able to obtain hospital parentage acknowledgments in 4 0 percent of
its nonmarital newborn cases .

Where parentage is contested, the Commission recommends a number of
improvements to state law. For example, the Commission recommends
that Congress require states to create a presumption of parentage
if genetic test results reach a threshold probability of parentage
or a threshold percentage of exclusion, as established by the
state. Further, to prevent delay tactics, the Commission
recommends that states have laws that require a tribunal to order
temporary support if test results create such a presumption of
parentage .

G. Health Care Support

In 1991, of the 25 million children without employer-provided
insurance, 8.4 million lacked any kind of public or private

Section 31 of the 1968 Revised URESA.

122

insurance. Health care for children is vital. If insurance is
not available to either parent at a reasonable cost, the Commission
believes that states and the federal government should expand the
eligibility of Medicaid and CHAMPUS to cover such children. To
minimize government costs, governments could charge parents a
premium for dependency coverage at a rate that would cover actual
administrative and reimbursement costs.

Where insurance is available, the Commission wants to ensure that
children have effective coverage. That is not the case today.
Despite a federal requirement that states in IV-D cases pursue
medical coverage when obtaining a child support order, about 60
percent of all support orders lack provisions regarding health
insurance.* The lack of mandated health coverage is especially
evident in interstate cases. Seventy-five percent of custodial
mothers in interstate cases reported in 1989 that health insurance
for children was not provided by the noncustodial father.'

Even where insurance is obtained for the child, the custodial
parent may lack access to the coverage . The Commission heard
testimony of employer-provided insurance plans that discriminate in
dependency coverage; of obligors who fail to enroll their children
as ordered; of insurance carriers that refuse to accept claims
filed by the custodial parent on behalf of the employee's
dependents; and of obligors who pocket insurance reimbursements
rather than forward the money to the custodial parent .

One obstacle to state efforts to enforce broad coverage is the
Employee Retirement Income Security Act of 1974 (ERISA) .'"' ERISA
primarily deals with pension plans. However, it also preempts
state regulation of health insurance plans where the employer bears
the risk of loss; according to the U.S. General Accounting Office,
56 percent of the nation's employees in 1990 were covered by self-
insured ERISA plans. ^^ Unfortunately, ERISA does not fill the
state regulatory void. The result is that self- insured plans are
subject to neither federal nor state regulation.

This preemption has been a major impediment to states seeking to
address the problem of healthcare support for children. For
example, the Commission received testimony that many self-insured
plans refuse to provide dependency coverage unless the dependent
resides with the employee. Such discrimination has a negative
impact on interstate cases and nonmarital children. Yet, ERISA
prevents states from prohibiting discrimination by self-insured
plans.

The Commission recommends that Congress remove the effects of ERISA
preemption of state regulation of health-care coverage for
children. Once that is done, states should enact laws prohibiting
discrimination based on whether a child lives with the employee or
was born during a marriage .

The Commission's Report also contains a number of recommendations
that encourage the insurance carrier to deal directly with the

^ Children's Defense Fund, Special Report: Children and
Health Insurance (1992) .

' U.S. Bureau of the Census, Child Support and Alimony:
1989. Current Population Reports, Series P-60, No. 173 (Washington,
DC: Gov't Printing Office 1991).

' U.S. General Accounting Office, Interstate Child Support:
Mothers Report Receiving Less Support from Out-of-State Fathers.
HRD-92-39FS (1992) .

^° 29 U.S.C. §§ 1001-1461 (1988).

^^ U.S. General Accounting Office, Medicaid: Ensuring that
Noncustodial Parents Provide Health Insurance Can Save Costs
GAO/HRD-92-80 (June 192) .

123

custodial parent. For example, when a parent has been ordered to
provide healthcare coverage, state laws should require insurance
carriers to accept an application for dependency coverage from the
uninsured parent; to accept claim forms signed and filed by the
uninsured parent on behalf of the insured employee's dependents;
and to directly reimburse the parent who paid for the health care.

The Commission recommends that employers should also facilitate
healthcare coverage. For example, the Commission recommends that
employers and unions should release to the uninsured parent or the
IV-D agency information about the dependency coverage, including
the name of the insurance carrier; enroll children who are
beneficiaries of ordered health coverage immediately upon receipt
of the tribunal's order or upon the authorization of the employee;
withhold healthcare insurance premiums similar to wage withholding
for support; and provide notice of any termination or change in
insurance benefits affecting the employee's children.

H. Staffing and Training

Even the best automated system will not replace the need for an
adequate number of trained personnel to process child support
cases. However, child support case workers are staggering under
the weight of overwhelming caseloads. The average FTE child
support worker has over 1000 cases. '^ While OCSE has cited many
states for failure to conform to the audit criteria requiring the
processing of 75 percent of cases needing services, no staffing
study or mandated staffing level has ever been imposed by OCSE.

The Commission strongly urges Congress to take action to ensure
that the staffing levels in the state and local agencies are
increased. The Secretary of Health and Human Services should
conduct a staffing study in each state -- with state input --to
determine staffing needs. States should then be required to
implement the recommended caseload staff ratio. I am pleased that
Congresswoman Kennelly has included compliance with the mandated
staffing studies as part of her bill. Additionally, the Commission
recommends stronger federal and state commitment to training to
ensure that problems are better anticipated, resources are more
widely used, and appropriate legal remedies are sought.

I . Funding

Currently states receive 66 percent of their funding for
administrative costs from the federal government. States also
receive federal incentives of 6 to 10 percent (based on collection
efficiency) of the amount collected for both AFDC and nonAFDC
cases. However, federal incentives are capped in nonAFDC cases at
115 percent of the amount collected in AFDC cases.

Some argue that the incentive program should be maintained and
retargeted to reward states that perform well on criteria that
reflect the program's goals. Such goals may include the
traditional duties of child support agencies: to locate parents,
establish parentage and support orders, and enforce orders. Others
argue that incentives skew state case-processing priorities by
forcing states to work only those cases that will likely meet the
target criteria. Most persons who want to eliminate incentives
prefer to see the incentive money shifted to enhanced federal
administrative cost funding, which would translate to a federal
funding rate of 80 to 90 percent of the administrative costs
incurred by states .

The Commission urges Congress to fund a study to examine funding
alternatives. In the interim, the Commission recommends three
immediate changes: revising the federal incentive formula to

^^ Center for Human Services, U.S. Dep't of Health and Human
Services, A Study to Determine Methods, Cost Factors. Policy
Options and Incentives Essential to Improving Interstate Child
Support Collections: Final Report 36 (1985) .

124

reflect a balanced program that serves both AFDC and nonAFDC
families, revising the federal funding formula to provide
incentives for healthcare support, and requiring states to reinvest
incentives into the child support program. Any revisions should
have a transition period before audit penalties could be imposed
and a promised moratorium before further changes could be made to
the formula. This would allow states to plan their budgets more
effectively over a longer period of time.

In summary, the Commission believes that implementation of its
recommendations will result in a strong child support program that
is more uniform, equitable and accessible than the system that now
exists. I am pleased that our distinguished members Senator Bill
Bradley, Congresswoman Barbara Kennelly and Congresswoman Marge
Roukema have already introduced legislation based on the
Commission's report. The importance of their support of the
Commission and commitment to strong child support enforcement
cannot be overstated.

III. Administration's Proposal

I appreciate the opportunity to comment on President Clinton's
child support proposals in A Vision of Change for America.

As discussed above, the Commission agrees with the need for a
national computer network, registries of support orders, and W-4
reporting. In addition I would like to make the following
comments.

A. Parentage Establishment

There is consensus among the three child support proposals that
Congress should require states to have nonadversarial procedures
for the establishment of paternity, including hospital parentage
outreach. It is also crucial that states promptly pursue parentage
establishment. Therefore, I recommend that Congress amend Title
IV-D to require states to use expedited procedures for the
establishment of parentage. Currently, states are required to use
expedited procedures for the establishment and enforcement of
support, yet expedited procedures for parentage establishment are
at the option of the state.

B. Healthcare

There is also consensus among the three proposals as to the
importance of healthcare support. I urge the Administration to
seek to remove the ERISA preemption regarding state regulation of
healthcare coverage for children. Although Senator Bradley, and
Congresswomen Roukema and Kennelly have addressed many of the
Commission's healthcare recommendations, this crucial
recommendation is not part of the bills they have introduced.

C. Involvement of IRS

The Administration's proposal speaks of using the IRS to collect
seriously delinquent cases. As discussed elsewhere, the Commission
concluded that replacement of state enforcement efforts by
federalizing enforcement with the IRS would not effectively reform
the child support system. This conclusion was based on testimony
from throughout the country and 2 1/2 years of intense study and
analysis. On the other hand, more could be done to improve IRS'
current enforcement responsibilities.

For example, the Commission recommended a number of changes
regarding the federal income tax refund intercept . Current
statutory requirements set different criteria for AFDC and nonAFDC
cases. The Commission recommends that custodial parents in nonAFDC
IV-D cases should be entitled to use the federal income tax refund
offset procedure to collect arrearages regardless of the age of the
child -- just as now available in AFDC cases. When money is
collected through the offset, the Commission recommends a change in
the priorityof distribution. We recommend that the intercepted

125

refund first be distributed to the family for nonAFDC arrearages,
then to the federal government for federal tax debts, then to state
or local governments for AFDC child support arrearages, and finally
to other entities as delineated in Section 634 of the Internal
Revenue Code .

The Commission also recommends that Congress strengthen the "full
IRS collection" procedure established in 26 U.S.C. § 6305 and 42
U.S.C. § 652.

Finally, I personally support a proposal that the federal income
tax return should be used to require the obligor to voluntarily
report any unpaid child support and to include payment toward such
arrears along with his or her federal income taxes. In support of
the proposal, the W2 fojrm completed by employers should be amended
to include information concerning the amount of money withheld from
the employee ' s wages for purposes of support enforcement .

IV. Conclusion

This is an exciting time in the child support community, and a time
of hope for custodial parents. The Interstate Commission's report
has been issued, and in less than a year has resulted in pending
federal and state legislation. President Clinton has made improved
child support enforcement a national priority. Both Democrats and
Republicans are committed to improving the child support system.

Although there is great disagreement on proposals to federalize
child support, there are many areas of strong agreement .
Recommendations regarding a national computer network, registries
of support orders, W-4 reporting, direct income withholding,
streamlined paternity establishment, improved healthcare
enforcement, adequate resources for the child support program
(financial and personnel) -- all have received almost universal
endorsement. I urge Congress to take advantage of this historic
moment and speedily act on these agreed-upon proposals that are at
the core of any reform of the child support system.

Thank you, Mr. Chairman, for the opportunity to testify.

72-449 - 93 - 5

126

Chairman Ford. Thank you very much.
Mr. Infranco.

STATEMENT OF MICHAEL INFRANCO, DEPUTY COMMIS-
SIONER, HUMAN RESOURCES ADMINISTRATION, NEW YORK
CITY

Mr. I^fFRANCO. Thank you very much. My name is Michael
Infranco. I am deputy Commissioner of New York City's Human
Resources Administration. I am very pleased to have this oppor-
tunity to appear before you today. Our agency is one of the largest
direct providers of child support services in the Nation.

The child support enforcement job is not an easy one, especially
so in New York City, where poverty and nonmarital birthrates are
high. The mobility and density of populations make absent parent
location efforts particularly difficult.

High levels of unreported or extra-legal income and self-employ-
ment make establishment and collection of support awards often a
challenging undertaking; and, most significantly, we must rely
heavily on the judicial system, which is very demanding in its pro-
cedures, but at the same time is itself burdened by high case loads
and other serious child welfare issues.

Despite all of these challenges, we in New York City have made
much progress, especially in the last several years. Our collections
last year totaled $190 million, or $33 million more than the year
before. Over the last 3 years, collections have increased by nearly
75 percent.

The bottom line is that we have been able to provide child sup-
port for a much greater number of children and to a much greater
extent. Much of the progress can be attributed to the City of New
York's aggressive use of the tools provided by the Family Support
Act of 1988.

For one, the system often does not work for cases in which the
noncustodial parent is not regularly employed, again getting back
to the situation where you have extra-legal income or self-employ-
ment, and therefore for which income withholding is not possible
or feasible.

Secondly, the judicial processes for obtaining support establish-
ment are often complicated, time consuming, too adversarial and
frustrating to us. It effectively limits access to the program, not
only for the IV-D program staff, but also to many mothers and cus-
todial parents who need to have that access.

Similarly, the interstate process continues to be characterized by
long delays, confusion and lower likelihoods of success.

Finally, I think we need to do a much better job convincing par-
ents that paternity establishment is important, that child support
can play an essential role in achieving self-sufficiency for single
parent households. And although the process can be frustrating,
help can be gotten to make the system work for the children's sake.

127

As important as these proposals are, it is important that they be
viewed in relation to how well and to what extent they address the
issues and impediments just noted.

From New York City's perspective, the Commission on Interstate
Child Support has indeed presented an excellent blueprint for re-
forming not only its State case processing, but also the entire pro-
gram. We enthusiastically and strongly endorse its recommenda-
tions.

The child support enforcement assurance proposal goes beyond
strengthening the child support enforcement program and seeks to
provide a minimum level of economic security for all single-parent
households through its assured benefits. We certainly concur in
this objective as well.

However, there are some specific proposals which have particular
relevance to our experience. In my testimony I have commented in
greater detail about them, and they certainly have been mentioned
here. Particularly of help to us would be the W-4 new hire system
of reporting. We feel that would be an excellent help to us, and we
have had some direct experience in the benefit from this type of a
system in that we do direct computer payroll matches with a num-
ber of large organizations, which is not quite the same — certainly
not universal. But where we can do that, it really helps the proc-
ess.

Also, I have some concerns about, as has been expressed, the role
of IRS, and I think many of the others, and the panelists have ade-
quately spoken on that and answered some questions about our
particular experience in that area. However, what I would like to
talk about a little more is paternity.

Since the great majority of New York's child support cases in-
volve nonmarital children, we particularly welcome those proposals
that call for the adoption of a simplified nonadversarial and hos-
pital-based paternity establishment procedures by the States. In
fact, for the past year New York City, in conjunction with New
York State Department of Social Services, has been engaged in a
federally funded pilot program to test such procedures at several
hospitals.

Our preliminary experience has confirmed that for early pater-
nity establishment to become a reality, we must work with parents
to convince them of the desirability and the benefit to their chil-
dren to do so. Just having voluntary processes available at the time
of birth is not sufficient, as we think the Interstate Commission's
suggestion to enhance Federal funding be made available for States
to work with hospitals and birthing facilities. To gain parents' co-
operation is an important recommendation which should not be
overlooked.

Finally, I would like to point out that New York City does not
look at its child support enforcement program in isolation. Rather,
we see it as an integral part of our overall efforts to promote family
self-sufficiency and help lift children out of a life of government de-
pendency and poverty. We know that child support usually cannot
do this alone.

Welfare reform in New York City is alive, not only as an idea but
also in terms of concrete efforts to expand the JOBS program and
to try out new ways where we as an agency can deliver comprehen-

128

sive services to families. Right now we are very excited about our
planned participation this October in New York State's Child As-
sistance Program, or CAP. As you know, this CAP is the only oper-
ating test of a child assurance payment system, I believe, operating
in the country, and we view it as an excellent example of welfare
reform and urge your support by continuing to allow and promote
such demonstrations.

In closing, I would just like to again thank you for the oppor-
tunity to comment on these support issues.

[The prepared statement follows:]

129

TESTIMONY OF MICHAEL INFRANCO
CITY OF NEW YORK HUMAN RESOURCES ADMINISTRATION

Good morning Congreesman Ford and other members of the committee. My
name is Michael Infranco. I am Deputy CommiBsioner of New York City's
Human Rf=!«onroft8 Administration. 1 am here today on behalf of
CommlBsloner Barbara Sabol. Specifically, I head the Human Resources
Administration's Office of Child Bupport Enforcement which la
responsible for administering the IV-D program for New York City.

I am very pleased to have this opportunity to appear before you. Our
agency is one of the largest direct providers of child support
services in the country. Thus we have a great deal of experience to
draw upon and a very large stake in the outcome of the proposals now
before Congress. Also, I personally welcome this opportunity because
I very strongly believe in the necessity of the program and the great
Importance of ite mission, eBpecially to the lives of millions of this
country's most vulnerable citizens - its children living at or near
poverty levels. In my 17 years of deep involvement with the program I
have been able to see first hand how Congressional action can greatly
affect the ability to perform our mission of helping children get the
support that they deserve from both parents .

The child support enforcement job is not an easy one, ©specially in
New York City, where poverty and non-marital birth rates are high,
where mobility and density of populations make absent parent location
efforts particularly difficult, where high levels of unreported or
extra legal income and self -employment make the establishment and
collection of support awards often a challenging undertaking, and,
most significantly, where we must rely heavily on a judicial system
which is very demanding in its procedures, but at the same time which
is, itself, overburdened by high caseloads and other serious child
welfare issues.

Despite all these challenges, we in the City of New York have made
much progress especially in the last several years. New York City
child support collections last year totaled $190 million or $33
million more than the year before. Over the last three years
collections have increased by nearly 75%. The bottom line is that
this has meant that we have been able to provide child support for a
much greater number of children and to a much greater extent.

Much of this progress can be attributed to the City of New York's
aggressive use of the tools provided by the child support provisions
of the Family Support Act of 1988. Along with the creative and
dedicated efforts of staff, it has been primarily the use of new
guidelines for setting and modifying support awards, the use of
immediate income withholding, and the use of automation, that have
made such progress possible In New York City. It should also be noted
that further progress is expected as we begin to implement recently
enacted New York state legislation addressing the Family Support Act's
requirements for the periodic adjustment and review of orders, as well
as provisions for hospital-based paternity establishment, medical
insurance enforcement and the direct seiture of the assets of
delinquent non-custodial parents.

However, New York City is no different from the rest of the country in
that much more needs to be done if we are to come close to meeting
this program's potential. There are major problems impeding progress
which urgently need to be addressed. For one, the system often does
not work for cases in which the non-custodial parent is not regularly
employed and, therefore, for which income withholding is not possible
or feasible. We need simple and creative solutions for effectively
and efficiently dealing with the growing large number of such cases.

Secondly, the judicial processes for paternity and support
establishment are often complicated, time consuming and frustrating.
This discourages participants and effectively limits access, leaving
many children without the benefits of the support enforcement program.
We need to develop simpler, less adversarial and more convenient
processes for support establishment.

130

Thirdly, Interstata cases continue to be characterltad by long delays,
confusion and lower likelihoods of success. The interstate process
must be eimpllfied, etandardlsed and eped-up.

Finally, but I believe most Importantly, we need to do a much better
job convincing parents that paternity •stabllshment is important, that
child support can play an essential role in achieving and maintaining
self-sufficiency for single parent households, and that although the
process can be frustrating, help can be gotten to make the system work
for their children's sake. Without the cooperation of parents, no
success is possible.

There are many different proposals to reform the child support
enforcement program. It Is Important as these proposals are
considered, that they be viewed in relation to how well and to what
extent they address the issues and Impediments just noted. In
general, from New York City's perspective, the Commission on
Interstate Child Support has Indeed presented an excellent blue-
print for reforming not only interstate case processing but also the
entire program and I enthusiaBtlcally and strongly endorse its
recommendations. The Child Support Enforcement and Assurance Proposal
goes beyond strengthening the child support enforcement program and
seeks to provide a minimum level of economic security for all single
parent households through its assured benefits. We certainly concur
In this objective as well.

However, there are some specific proposals which I would like to talk
about today because of their particular relevance to our child support
experience in New York City.

f.otgrnity gpt»bllghment

Since the great majority of New York City's child support cases
involve non-marital children, we particularly welcome both the
Commission's and the Child Support Enforcement Assurance Proposal's
recommendations on parentage, including those that call for the
adoption of Eimpllfied, non-adversarial and hospital-based paternity
establishment procedures by the states. In fact, for the past year
New York City, in conjunction with the New York State Department of
Social Services, has been engaged in a federally funded pilot program
to test such procedures at several hospitals. Our preliminary
experience has confirmed that if early paternity establishment is to
become a reality we must work with parents to convince them of the
desirability and benefit to their children to do so. This is true
even if voluntary establishment of paternity does not require
judicial action as soon will be the situation in New York State. Our
experience leads us to conclude that just having voluntary processes
available at the time of birth is not sufficient. Thus we think that
the Interstate Commission's suggestion that enhanced federal funding
be made available for states to work with hospitals and birthing
facilities to gain parents' cooperation is a very important
recommendation, which should not be overlooked.

Reporting of New Hires

The CommiBBlon's recommendation calling for the reporting of new hires
through the W-4 process will without doubt be of major assistance. We
have numerous cases where the traditional methods of reporting
employment to the child support program Is too delayed to be of use.
These are often situations, which because of the nature of the
employment, for example, food services or construction, job changes
are frequent and those who wish to avoid their child support
reBponslbilities can more easily do so. Additionally, we already know
early reporting works because of our succesBful experience with
ongoing direct computer payroll matches . Thus the federal government
can take a very positive step by adopting a universal new hire
reporting system as proposed by the Interstate Child Support
Commission.

131

The Rol» of the Intamal R«vnu» STvica

I would Ilka, though, to strike a note of caution regarding the
recommended role of the Internal Revenue Service in the child eupport
program as called for in the Child Support Enforcement Anaurance
Proposal. Primarily because of the atatee ' poor collection record in
many caeee, it ia being recommended that the IRS aeaume full
responoibility for child support collections. However, based upon our
experience, this may be unwise since the most difficult cases to
collect child support from, are those where income withholding is not
readily possible, namely in cases with illegal or unreported income
and in cases with sel f -employment . It is no coincidence these are
precisely the situations in which the IRS has difficulty collecting
taxes, as there seem to be a strong parallel between being able to
avoid supporting your government and being able to avoid supporting
your children. Thus I see no reason to expect significant
Improvements from this recommendation. To be sure, there is a need
for an increaaed IRS role. But here again the Interstate Commission
has provided a blueprint for this with its recommendation for
improving the IRS full collection service which is now available but
which is not widely used because of its present ineffectiveness. The
Commission has also made a number of additional suggestions including
governmental license restrictions and penalties for the hiding of
assets among others. We feel these types of approaches are more
likely to succeed with these difficult cases.

Finally, I would like to point out that New York City does not look at
the child support enforcement program in isolation. Rather we see it
as an integral part of our overall efforts to promote family self-
sufficiency and help lift children out of living a life of government
dependency and poverty. We know that child support usually cannot do
this alone. Rather, as emphaslEed by the Family Support Act,
meaningful work, child care and child support enforcement together
offer the beet means for accomplishing this. Just as we look forward
to Congressional action to strengthen the child support program, we
look for your support, especially as to funding, in these other areas
as well.

Welfare reform in New York City Is alive not only as an idea but also
In terms of concrete efforts to expand the JOBS program and to try out
new ways, where we, as an agency, can deliver comprehensive services
to families in order to lift them out of poverty. Right now we are
very excited by our planned participation this October in New York
State's Child Assistance Program or CAP. As you know CAP is the only
operating test of a form of assured child support payments in the
country. In CAP, through an assured higher level of benefits than
AFDC and through comprehensive services, child support enforcement,
employment and economic independence are all encouraged. We view CAP
as an excellent example of welfare reform and urge your support by
continuing to allow and promote such demonstrations.

In closing, on behalf of the Hew York City Human Resources
Administration, Commissioner Barbara Sabol and myself, I would like to
again thank you for the opportunity to comment on these very important
issues now before Congress.

132

Chairman Ford. Thank you very much.

I know it is warm up here; I don't know whether it is as warm
out there. If you would hke to pull your coat off, you are welcome
to do so.

Mr. Melia.

STATEMENT OF ROBERT M. MELIA, DIRECTOR OF STRATEGIC
PLANNING, MASSACHUSETTS DEPARTMENT OF REVENUE

Mr. Melia. Good afternoon, Mr. Chairman. My name is Bob
Melia. I am the director of strategic planning at the Massachusetts
Department of Revenue. I oversee both tax administration func-
tions and the child support enforcement program in my State.

From a tax administrator's point of view, the good news about
child support is that over the last 15 years collections have in-
creased sevenfold. The bad news is that the program's budget has
also increased sevenfold, which means there has been no increase
in productivity during that time.

That is especially disappointing in light of the 1984 and 1988
Federal reforms which gave States more and better enforcement
tools, and also in light of the hundreds of millions of dollars that
the Federal Government has spent on improving computer systems
for child support agencies.

It is suggested there is something fundamentally wrong with the
enforcement strategy that we are pursuing. Our existing strategy
is caseworker-based. That is, we expect an individual caseworker
to review individual cases, make individual decisions, and enforce
those cases one at a time.

We all know the results. With a case load of 13 million, the sys-
tem has all but collapsed. We need to build our program around
a new strategy, a strategy that involves a seamless, highly auto-
mated collection system that can enforce the majority of cases with-
out the need for caseworkers to ever touch that case.

In the last year and a half in Massachusetts, we have made sig-
nificant progress toward building such a system. There are two
fundamental parts to the system. One is a new hire reporting. In
Massachusetts, all employers must report new hires to the revenue
department within 14 days of hire. That information is imme-
diately entered into our computer system, and 24 hours later the
employer receives a wage assignment in the mail. That has allowed
us to enforce about two-thirds of the cases where the father is in
Massachusetts without a caseworker ever having to lift a finger.

The way we now move to collect past-due child support involves
what we call an administrative lien. That is a notice to an obligor
that says unless you pay what you owe in full within 30 days, the
Department of Revenue will seize any income or assets it can find.
Over the last year we have sent out 70,000 such notices and what
it allows us to do is to match a file of all the child support
delinquents in Massachusetts against, for example, a data base of
6 million bank accounts in Massachusetts, identify the bank ac-
count of every single child support delinquent in the State and
freeze them all on the same day without a caseworker having to
get involved.

Together, those two innovations have improved the in-State com-
pliance rate — that is where the obligor is in Massachusetts — from

133

65 percent to 80 percent in about a year and a half. That is note-
worthy because at the national average, the compliance rate is in-
creasing by less than 1 percent per year. It means by abandoning
our caseworker-based strategy and shifting to this new strategy, we
were able to achieve in about a year and a half what probably
would have taken 15 to 20 years had we stuck with the old
strategy.

Also, at an 80 percent compliance rate, child support assurance
becomes affordable. We did a simulation on 85,000 families to de-
termine what would have happened in Massachusetts had a child
support assurance program been in effect in 1992. We found that
3,000 families would have been able to leave the welfare rolls, that
the poverty rate among working single-parent families in Massa-
chusetts would have been cut 25 percent, and that the net cost to
the State would have been about $35 million.

As this committee seeks to fashion the next major piece of child
support reform legislation, you will hear literally hundreds of sug-
gestions. The Massachusetts experience suggests that five of them
are key to improving child support collections.

First, create a national new hire data base. Extrapolating from
our experience, that might be worth as much as $2 billion a year
in additional child support collections.

Second, allow all States electronic access to IRS data.

Third, require all States to adopt the administrative lien and
automated enforcement capability that we have pioneered in Mas-
sachusetts.

Fourth, require States that still operate on a fragmented local or
county basis to consolidate their programs at the State level be-
cause unless they consolidate at the State level, they will simply
be unable to take advantage of these innovations.

And fifth, to adopt the full faith and credit in the one order, one
place, one-time recommendations of the U.S.

Chairman Ford. When you say consolidate on the State level, I
don't want to cut you off, but

Mr. Melia. In many States the program is run in effect on a
county level or at a local level where there is a IV-D director with
a small staff, but that director is a coordinator and not a manager
of the program, and every county is on its own. You might have
50 or 60 or 70 or 80 counties in a State, and if you are that frag-
mented, your ability to put together a single State data base and
start to do the types of computer matches against other data bases
is extremely limited and it is extremely cumbersome.

Chairman Ford. OK.

Mr. Melia. If Congress will make those five reforms, which I
think are not expensive, at least they have not been in Massachu-
setts, I think that without significant additional spending you can
achieve significant improvements across the country.

Mr. Chairman, thank you for the opportunity to testify.

[The prepared statement follows:]

134

TESTIMONY OF ROBERT M. MELIA

DIRECTOR OF STRATEGIC PLANNING,

MASSACHUSETTS DEPARTMENT OF REVENUE

before

Subcommittee on Human Resources

Committee on Ways and Means

United States House of Representatives

Thursday, June 10, 1993

Mr. Chairman, my name is Bob Melia, and as the Director of
Strategic Planning for the Massachusetts Department of
Revenue (DOR) I oversee both tax administration and child
support enforcement efforts in the Commonwealth.

Thank you for this opportunity to discuss new directions in
child support enforcement, and to share some of the
cutting-edge child support collection techniques developed
by DOR. My comments today will focus on three topics:

o Using the power of a state tax agency to collect child
support;

o Analyzing the costs and benefits of child support
assurance; and

o Leveraging federal funding to force sudden, dramatic
improvement in states' enforcement efforts.

Many of the ideas and recommendations presented here
represent a radical change in enforcement strategy. I'd
therefore like to take a moment to discuss why such change
is necessary.

The Problem

In 1979, every dollar spent on child support enforcement
yielded only $3.70 in collections. Since then. Congress
has done a great deal to strengthen the effectiveness of
enforcement efforts and improve productivity. Thanks to
federal reform efforts, the following tools are now used in
every state:

o Child support guidelines, designed to increase the
amount, fairness and uniformity of support orders;

o Wage withholding, intended to make collection fast and
simple;

o Tax refund intercept, developed to be a highly

cost-effective way to collect past-due child support;

o Unemployment compensation intercept, intended to be a
reliable way to ensure the continued flow of child
support when obligors are between jobs;

o Liens, designed to efficiently collect arrears; and

135

o The Federal Parent Locator Service, intended to be an
effective way to locate obligors who have moved out of
<; •-. a t «? .

All of these tools — by making enforcement easier and
more efficient — should have sharply boosted the
productivity of the program. Moreover, the federal
government has invested hundreds of millions of dollars in
computer support for the program, which should have
increased productivity still more. But the basic equation
hasn't changed. A dollar spent on child support today
translates to just $3.82 collected. That's an average
improvement in efficiency or productivity of just three
tenths of one percent per year.

This complete lack of improvement in productivity has
prevented the program from fulfilling its promise.
Collections have increased six-fold since FY79, but only
because the program's budget has also increased six-fold.
This amounts to a policy — one hesitates to use the word
"strategy" — of simply throwing money at the program.

If the available funds were inexhaustible, this policy
might eventually work. However, given the current fiscal
climate and our current collections to cost ratio, it is
prohibitively expensive to create an effective child
support enforcement system. If every family that qualified
for a child support order had an order set under
guidelines, over $30 billion in child support would be
payable per year. At our current 3.8:1 ratio, we'd need to
spend $8 billion a year to collect this money, quadruple
what we're spending now.

The real question facing Congress, then, is this: either
find another $6 billion to throw at the program, or develop
a better, more productive strategy.

A Shift in Strategy

Zero productivity growth and failure to achieve dramatically
better results have caused many legislators and children's
advocates to think about transferring the program to the IRS.
The most compelling argument for doing this is captured in
one statistic: each year the IRS collects about 90 percent
of what is owed, but for child support enforcement, that
figure — known as the "compliance rate" — is just 50
percent.

As someone with one foot in tax administration and the other
in child support enforcement, I'd like to discuss the key
differences in enforcement strategy between a tax agency and
a child support agency and suggest ways to use tax
enforcement techniques to collect more child support.

The main reason why the compliance rate for taxation is so
much higher is because the tax system was designed to handle
huge numbers of cases quickly and easily. For example, when
a taxpayer moves out of state and changes jobs, his new
employer automatically withholds the proper amount of tax and
sends it to the IRS, which doesn't have to lift a finger. it

136

that same person also owes child support here's what usually
happens : zhe mother calls to complain that she hasn't
received her check. A caseworker checks to see if the father
is paying and discovers he is not. She calls the father's
old employer and learns that the father has left. She then
puts in a locate request, and waits weeks or months for the
response. In the meantime, the mother calls again and again
to check on the status of her case, and each call triggers a
predictable — and predictably futile — response.

In short, every time an obligor changes jobs, we have a
crisis. As 1.9 million obligors change jobs each year, that
works out to 7,600 crises every working day. No wonder
productivity isn't improving. After coping with all the
crises, there's no time left for improving the program.

when the IRS implemented large scale tax withholding in the
1940s, they designed the system so that it would work. They
ENGINEERED it.

Nobody designed the child support system the way it is. The
problem is that nobody designed it at all. The child support
enforcement system grew up piecemeal during the 1940s and
1950s. Back then, divorce was rare, birth out of wedlock
was scandalous and society was much less mobile. In 1945 the
average county had an AFDC caseload of 68 cases. It was easy
for one probation officer to keep track of all his cases.

Fundamentally, that system is still in place today. We have
put a veneer of automation and centralization onto the
program, but in most states, it still comes down to an
individual caseworker making individual decisions about
individual cases. We all know the results. This system has
all but collapsed under the weight of 13 million cases.

We need to build a system that handles the vast majority of
cases without human intervention. While I do not advocate
transferring the program to the IRS, we must build a system
that collects child child support as efficiently as the IRS
collects taxes. And because we haven't got another $6
billion to throw at this problem, we need to build a system
that will do more, better, faster with less.

That's a tall order. But it's not as far in the future as
some may think. Over the last 18 months we've made a good
start in Massachusetts. I'll be the first to admit that we
haven't made much progress in Massachusetts in the areas of
paternity establishment or modification. But we've
revolutionized our approach to enforcement.

We've completely reengineered key business processes, with
the goal of enforcing most cases without human intervention.
There are three major elements to this approach:

o Cases with similar characteristics are grouped together;

o Decision-rules determine what type of enforcement

actions should occur for particular groups of cases; and

The computer searches various databases and
automatically takes the appropriate enforcement action.

137

We start by notifying every obligor who is at least $500 in
arrears of the amount of his dsbt, and ve L■cq.)P<;^ pav'n»er,i-
within 30 days. If the debt is not paid, we send a second
notice informing the obligor that an administrative lien is
in effect and that the Department of Revenue will seize any
asset or income stream we can find if payment is not made
within 30 days. Since last spring we have issued 70,000 such
liens .

We routinely match this file of 70,000 cases against other
databases, including wage reporting data, tax data, bank
account data, and information on unemployment compensation
recipients, workers' compensation claimants and lottery
winners. When a match is found, any of the following actions
can occur without human intervention:

o If the obligor is more than $500 in arrears, the

system will also instruct the employer to increase the
amount withheld by 25 percent, until the arrears are
paid off.

o If the obligor has a bank account in Massachusetts, we
will automatically seize funds by "levying" the
account.

o And if the obligor is receiving government benefits
unemployment insurance, workers' compensation
benefits or lottery winnings — those benefits will
automatically be levied.

In addition, when our new hire reporting system indicates
that an obligor has changed jobs, the system notifies the
new employer to withhold the amount of the support order.
While employers have 14 days to report a new hire to DOR,
many employers will fax us the information on the
employee's first day at work, usually a Monday. That
information is entered into our database that same day, and
the employer will receive a wage assignment 24 to 48 hours
later.

The system will also notify the obligor of the action being
taken, and offer an appeal process. The vast majority of
obligors do not appeal, meaning that thousands of cases can
be enforced without any human intervention at all.

The results have been remarkable:

We now track 35,000 obligors as they change jobs, go
onto unemployment compensation or injure themselves and
receive workers' compensation. These cases represent
two-thirds of all cases where the obligor is in
Massachusetts, and they are essentially on auto-pilot.

80 percent of our total collections are now made without
human intervention. If all of our caseworkers went on
strike tomorrow, that money would continue to flow.

The number of paying cases is at an all time high,
increasing by 34 percent since we began this radical

138

overhaul of our enforcement strategy.

c Our new hire reporting systera, coupled with our ability
to transfer wage assignments from one employer to
another without any caseworker involvement, is now
enforcing 500 cases per week in which the obligor is
changing jobs within Massachusetts.

o Collections from liens on workers' compensation payments
have nearly quadrupled since last year, and are now
running at a rate of $1.5 million annually.

o In a four month period we placed liens on 8,300 bank
accounts, netting $4.3 million.

o Collections from unemployment compensation benefits are
now running at $15 million annually, compared to $5
million under the manual process. Moreover, the number
of staff needed to run this part of our program has been
cut from 20 to 2.

If the old strategy was akin to giving a caseworker a fishing
rod, and asking him to reel in obligors one by one, our new
strategy is the equivalent of using electronic driftnets to
scocp up obligors by the thousands.

80% Compliance Rate

In August 1992 — when we began to move away from our
caseworker-based enforcement strategy — we collected 65
percent of the child support owed that month by obligors
who lived in Massachusetts. By March 1993 — when we had
completely abandoned our caseworker-based strategy in favor
of an automated enforcement strategy — that ratio had
increased to 80 percent, a 15 point increase (the
compliance rate for out of state obligors is far lower,
primarily because DOR cannot apply its new strategy to
these cases).

Nationwide, including interstate cases, the compliance rate
is about 50 percent. Moreover, the national compliance
rate has been increasing by less than one point per year.
That means DOR was able to achieve in just a year and a
half what would have taken fifteen to twenty years if we
had stuck with our caseworker-based approach and progressed
at the national average.

The only prerequisite for adopting this strategy is a
centralized, state-run child support enforcement program
with a single, comprehensive computer database of all IV-D
child support cases. Many states already meet this
prerequisite, and others are moving in this direction. If
we could achieve an 80% compliance rate nationwide, not
only would children be better off, but we could
open up dramatically new possibilities of welfare reform,
including child support assurance.

139

Child Support Assurance

Child support assurance has been receiving lots of
attention lately, and with good reason. Unlike AFDC, it
would provide tremendous incentive to work, because child
support benefits are not reduced by earnings. And unlike
traditional welfare reform proposals — which require
billions of dollars up-front for remedial education, job
training and child care costs — child support assurance
can be implemented at a very low cost, provided that
Congress makes a handful of key reforms that will enable
all states to get to an 80 percent child support collection
rate .

Because the Department of Revenue is the inf irmation nerve
center of Massachusetts government, we are : i a unique
position to analyze the feasibility and impact of child
support assurance. DOR has access to AFDC and Medicaid
information, wage reporting data, child support case
information, and the income tax returns of custodial
parents and obligors. We combined this data on the 85,000
current support cases that are enforced by DOR and
simulated what would have happened if Massachusetts had
implemented child support assurance in 1992.

Our simulation used the following criteria:

o There must be a child support order to qualify for the
program;

o All child support collected would be passed on to the
custodial parent;

o Regardless of the income received by the custodial
parent, he or she would be guaranteed a minimum of
$3,000 to $4,500 per year in child support, depending
on the number of children;

o The benefit would be available to all families with

child support orders, regardless of whether the mother
had remarried or had ever been on AFDC;

o Each dollar paid or passed on to the custodial parent
would reduce AFDC payments, if any, dollar for dollar.

In our simulation $165 million in assured benefits were
paid out. DOR recouped $95 million in child support
collections, for a gross cost to the state of $70 million.

However, net cost to the state was significantly lower
because the AFDC and Medicaid caseload was reduced by
nearly 3,000 cases. (Our simulation relied on 1990 work
done by Irwin Garfinkle, Philip Robins, Pat Wong and Daniel
Meyer to estimate the impact of child support assurance on
labor supply and AFDC caseloads). These case closings
resulted in $36 million in annualized savings, reducing the
net cost $34 million.

We also calculated that if we had been able to collect 78

140

percent of all child support due in Massachusetts in 1992,
that the cost of this program would be zero. As I've
already si-ated. by March of 1993 we h;»H (syreoded the 78
percent break-even point for those cases in which the
obligor lives in Massachusetts. However, our compliance
rate for cases in which the obligor is out-of-state is much
lower, resulting in overall compliance rate for 1992 of 62
percent .

We also analyzed the reasons for the $70 million shortfall
between assured benefits paid ($165 million) and the amount
of assured benefits recouped ($95 million). First, we
found that even if we had collected 100 percent of all
child support due in 1992, there would still be a shortfall
of $30 million. This happens because many child support
orders are lower than the amount of the assured benefit,
leaving government with some unrecouped assured benefit
payments, even when 100 percent of the child support order
is collected.

The remaining $40 million shortfall can be attributed to
inadequate enforcement. Of this amount, $24 million
accrued in cases in which the obligor was outside of
Massachusetts, and $16 million accrued in cases in which
the obligor was in Massachusetts but DOR failed to enforce
the case. Only one-third of DOR's obligors live outside of
Massachusetts. Yet this portion of the caseload adds more
to the cost of child support assurance than does the
two-thirds of the cases in which the obligor lives in
Massachusetts. This underscores the need for Congress to
create a workable interstate child support enforcement
system.

Finally, the assured benefit reduced the number of non-AFDC
families living below the poverty line in Massachusetts by
almost 25 percent.

What Congress Must Do

Most of the pieces of an effective child support
enforcement system are now in place, at least in some
states: a new hire reporting system; access to income tax
and bank account data; improved computer systems; and
state-wide child support databases.

Massachusetts was able to use these pieces to reach an 80
percent compliance rate in just a year and half. The
strategy we used does not cost much money. In fact, most
of the enforcement tactics described in this testimony
actually decrease the cost of running the child support
enforcement system by reducing the need for caseworkers.

Congress is now faced with hundreds of proposed child
support reforms. The U.S. Commission on Interstate Child
Support alone recommends 100 different reforms. Based on
the Massachusetts experience, there are six reforms that
are critical to a creating a child support system that
works:

141

Report New Hires: We estimate that a national system
of new hire reporting would increase child support
collections by about 52 billion arwVually, a'c a cuiL of
§10 million. This 200 to 1 benefit/cost ratio, in
contrast to the existing 3.8:1 ratio, demonstrates the
power of transferring a tax administration enforcement
strategy to child support.

Provide Access to IRS Data: Much of the information
used by DOR to identify obligors' income and assets
was reported to DOR for both tax and child support
enforcement purposes. If access to Massachusetts tax
data was the key to increasing compliance rates to 80
percent for obligors living in Massachusetts,
access to IRS data is the key to a national compliance
rate of 80 percent. This is the reason that some
advocates are urging Congress to transfer the child
support enforcement program to the IRS. However, it
will cost far less, and we'll see results far more
quickly, if we transfer IRS data to existing child
support enforcement programs rather than transfer the
existing programs to the IRS.

Automate Enforceaent: Switching from a
caseworker-based system to automated enforcement is
a fundamental prerequisite for improving the program.
Without this switch in strategy, child support
programs will be unable to make effective use of new
hire and tax data.

Consolidate Prograas at The State Level: The income,
asset and location data needed to run an automated
program is organized primarily at the state level.
County-based programs are too fragaented to make good
use of this data.

Give Pull Faith and Credit: Getting one state to
enforce a wage withholding order issued in another
state's court is notoriously awkward and
time-consuming. Often conflicting orders result,
complicating both automated and manual enforcement
efforts. He recommend that Congress adopt the U.S.
Commission on Interstate Child Support's proposal,
under which employers would be required to honor an
order issued by another state, as well as the UIFSA
"one order, one place, one time" provision. Without
these reforms, a national new hire database will be of
very little use.

Use Adainistrative Liens Across State Lines: Federal
law already requires each state to use liens to
collect past-due support. However, most child support
enforcement agencies do not have the authority to
administratively issue a lien. Because past-due
support has the status of a court judgment, it makes
no sense to go back to court to obtain a lien. Doing
so when a judgment already exists wastes the resources
of courts and child support enforcement agencies and
causes unnecessary delays. We recommend that Congress
require the use of administrative liens, and that they
be valid throughout the U.S. Under the present

142

system, arrears in interstate cases are collected at a
snail's pace through wage withholding. Once
administrative liens are available, collection cf
arrears in interstate cases will be revolutionized.

Federal Funding

I'd like to conclude my testimony with a few words on the
role that federal funding should play in any additional
reform. In the course of completing the next major piece
of child support legislation, Congress will hear many pleas
for more money for child support caseworkers, more monsjy
for computer systems and higher federal reimbursement
rates.

The child support enforcement program suffers from many
defects, but lack of money is not one of them. Since 1979,
spending on child support enforcement has increased
six-fold. Total federal spending has increased about two
and a half times during this same period. Congress has
been more than generous to this program.

There are still a handful of states where the
program is woefully underfunded. But overall, the program
needs a new strategy more than it needs new money. If
Congress agrees that the strategy we are using in
Massachusetts is valid — use computers and electronic
databases to collect child support, and use caseworkers
only for the minority of cases where human experience and
judgment is really needed (contested paternity cases,
self-employed obligors who are hiding income and assets,
etc.) — there is no longer any justification for an
open-ended reimbursement program that guarantees that the
federal government will reimburse two-thirds of a
caseworker's salary regardless of whether that caseworker
is productive. In fact, by continuing this funding scheme.
Congress may actually delay the day when other states
abandon their caseworker-based enforcement strategy and
move to a more effective automated strategy.

In Massachusetts, we did not adopt such a strategy until
faced with a severe fiscal crisis and an early retirement
program that resulted in 10 percent of our caseworkers
walking out the door on the same day. In government as in
all human endeavors, necessity is the mother of invention.
In Massachusetts, we would prefer to see Congress adopt a
lower federal reimbursement rate and use the savings to
increase incentive funding. We also recommend that
Congress require the states to reinvest all incentive funds
in their child support programs. If Congress gives states
a financial incentive to adopt techniques that work, we
might just create a child support enforcement system that
works .

Mr. Chairman, thank you for the invitation to testify
before this distinguished committee.

143

Chairman Ford. Thank you very much.
Mr. Williamson.

STATEMENT OF ROBERT D. WILLIAMSON, PRESIDENT,
AMERICAN SOCIETY FOR PAYROLL MANAGEMENT

Mr. Williamson. Thank you, Chairman Ford, for allowing me to
offer suggestions on behalf of the employer community and the
members of the American Society for Payroll Management.

Our members, the people in cnarge oi payroll operations at large
multiState employers, want the best possible withholding process
just as much as do child support workers because a streamlined ef-
ficient system will save employers administrative burden while it
gets the support money out where it belongs, to children, without
delay. We therefore were pleased to assist the Commission on
Interstate Child Support as it developed its payroll-related rec-
ommendations, and we generally support them.

We strongly urge that any new child support legislation include
the following. These sound like housekeeping details, but they are
really essential to a smooth operating system.

Give child support withholding top priority, even over a Federal
tax levy, and provide that it will not be interrupted by a bank-
ruptcy order.

Eliminate delayed response to interstate orders by allowing em-
ployers to act on all orders, regardless of their origin.

Uniform orders are needed, including standard definitions for in-
come and disposable pay.

Employers should be allowed a handling fee for making and pay-
ing over withheld child support. Ten dollars may sound high, but
surveys we have conducted indicate that this fee per pay period is
justified.

Guidance on allocating payroll deductions under multiple orders
is a must when, as is often the case, the obligor's disposable pay
won't cover more than one. When this happens today and inter-
state orders are involved, nobody really knows how to handle them.

For paying over withheld support, a central national payment
point would be ideal or at least a single remittance point per State.
We should not rush into immediate withholding. We recommend
that withholding commence only when an order is received and not
just on the employee's say-so on an expanded form W-4. We think
you could leave child support withholdings off the form W-2 be-
cause this information will appear on the employee's pay stub.

New hire reporting on form W-4 certainly makes sense, and it
will not be arduous, so long as employers are given reporting for-
mat flexibility and enough reporting time is allowed them. Under
present conditions, we believe that some multi-State employers
might need 30 days from the date of hire to report, preferably
again to a single point or at least one point per State.

Workable definitions of covered employees and rehires are also
needed.

Penalties for failing to report should be the same as for forms
W-2. That is $50 for each failure to provide up to a maximum of
$250,000 per year.

And lastly, employer education should be advanced through pub-
lications and outreach programs. We believe that most noncompli-

144

ance on the part of responsible employers is the result of unclear
information, or the lack of information, and it is not intentional.

The points I have just highlighted are elaborated at length in my
written testimony. I hope that we can continue to be part of the
development of the payroll-related aspects of the new child support
legislation, and I assure you that we stand ready to assist you and
the subcommittee in any way we can.

That concludes my testimony.

[The prepared statement follows:]

145

American Society For Payroll Management

P O Box 1221, New York, NY 10025
Phone (212) 662-6010 * Fax (212) 866-6517

WRITTEN STATEMENT OF ROBERT D. WILLUMSON
PRESIDENT, AMERICAN SOCIETS' FOR PAYROLL MANAGEMENT

SUBCOMMITTEE ON HUMAN RESOURCES

COMMITTEE ON WAYS AND MEANS

June 10, 1993

The American Society for Payroll Managcmeni is the associaiion thai represents the interests of large
U.S. employers We have long been concerned with the child support withholding process as it represents
a tremendous administrative burden for emplovcrs We were fonunaic to ha\e had the opportunity to
work closcl> with the Interstate Commission on Child Support throughout the development of its
recommendations to Congress We share the Commission's goals for a more efTicient child supf>on
withholding system, and know that the Commission and Congress are sensitive to the balance between
social goals and employer burden In this spirit, we are pro\iding comments for consideration in the
development of further reforms in child support enforcement

• Ensure That Child Support Withholding Always Takes Priority. Under the current laws, child
support may be interrupted by a bankruptcy order, and does not take priority over a federal tax levy unless
the withholding began before the employer's receipt of the le\> We urge Congress to pass legislation
giving child support absolute prionty over all other wage attachments

• Eliminate Legal Risks Associated with Interstate Withholding Orders. Many child support
enforcement units submit interstate withholding orders direcih to employers without regard to
jurisdiction, and without proper registration Determining when an order does or doesn't have legal
junsdiction is e.vtremcly complex for employers to determinc--and an error in judgment could result in
costly employee litigation We urge Congress to pass legislation that eliminates the current junsdictional
issues in matters of interstate withholding Specifically, we propose that Congress provide legislative
language that allows employers to legally process all child support withholding orders without regard to
their state of origin.

• State Uniformity. We urge Congress to require that all withholding orders, regardless of the state of
origin, be uniform In addition, a common definition for such terms as "income" and "disposable pay" are
necessary Currently, the definition of these terms \aries considerably among orders This lack of
consistency makes automation difficult if not impossible, and in\ites employer error We also urge
Congress to require that employer input be solicited in the development of a standardized child support
withholding order

" Recovery of Employer Cost. Federal law currently allows emplo\ers to collect an administrative fee for
child support withholding However, the amount of the adnunistratise fee is legislated by each state
Based on studies conducted by ASPM, the average cost to withhold and disburse child support is $10 per
employee per pav period Most stales allow for a much lower adminisirati\e fee We urge Congress to
mandate that the administrative fee for child support withholding be no less than $10 for each pay period
in which withholding is made from an employee's wages We concur that the combined total of the child
support withheld and the administrative fee not exceed the maximum percentage of disposable pay
allowed by law (e.g.. 50%)

• Multiple Withholding Orders In those instances where there is more than one withholding order
against an employee's wages, and disposable pay is insufficient to cover both, states are inconsistent wnh
respect to how withholding should be computed Some stales require an equal allocation to all
withholding orders (eg. Texas), while other states require that withholding be computed based on the
sequence in which the withholding orders were received (e g . Indiana) We propose that the procedure
be standard for all states, and believe that the allocation method is the most fair to dependent children

146

• Disbursement of Child Support Withheld. Under the curreni s>siem. most employers are required to
issue a separate payment to each county wiihin the stale One ASPM member reports making 5 separate
payments within one state Only 22 states ai this time ha\e one central payment location The
requirement to issue multiple payments to multiple agencies is nol only costly for employers, but can
create problems for the collection agencies, and ultimately, the custodial parent We propose that a single
collection and disbursement operation be put in place This collection and disbursement function could
be operated by private contractors under the supervision of the Federal Office of Child Support
Enforcement Through the use of such technologies as EFT, we believe that there would be no delay in
making payments to custodial parents under such a system In fact, we think that efficiency would
increase since withholding payments would no longer be transferred between agencies as they are now
Errors would also be eliminated. When an employer is required to issue payments to multiple agencies,
payinents are frequently forwarded to the wrong agency This results in significant delays in paying the
custodial parent It's important to add that under a central payment system, employer burden would be
significantly reduced as a single payment or electronic transfer is far less expensive and time consuming
than several

• Immediate Withholding Upon Date of Hire. It is our understanding that Congress is considering a
provision that would require employees to indicate if they owe child support and the amount of the child
support owed on a modified Form W-4 Based on this information, the employer must begin withholding
child support immediately Since the employer has no official confirmation as to the amount of
withholding, or to whom the withholding is to be paid, we urge Congress to include a protocol provision
that would allow employers to hold the amounts withheld in trust until a standard confirming withholding
order is received by the employer from the appropriate withholding agency

• Reporting Child Support Withheld on Form W-2. Some members of Congress recommend that
employers be required to report the total amount of child support withheld on the Form W-2 We believe
that this information is best obtained from the child support enforcement agencies. The enforcement
agencies already have the automated systems in place to track and report this type of information We do
not see the value of the fRS retrieving this information from employers We also urge Congress to
consider the reporting burden this requirement places on employers

• New Hire Reporting. Members of Congress have proposed that a national computer network be
established linking information from state enforcement agencies concerning new hires and rehires State
information is obtained from employers by their submission of the employee's Form W-4 Thirteen states
have already imposed new hire reporting requirements and 17 others are considenng legislation. Based
on our current expenence (both good and bad) with the slates' existing new hire reporting programs, we
make the following recommendations as it relates to new hire reporting:

1. Centralized Reporting. A central source of information reporting would be more efficient than
reporting information to each state. With centralized reporting, the reporting requirements are uniform
for all the states, multi-state employers need not prepare separate reports, and the information is better
controlled and disseminated to the stales from one central location In other words, one central data base
would provide information to the stales rather than many stales supplying information to a national data
bank. This concept is already embraced by the IRS in its "single wage reporting" project

2. Uniform Reporting Requirements. Where option #1 isn't possible, we urge Congress to require that
the states have uniform repiorting requirements Exhibit I below summarizes the many variables that
already e.xist in the states' new hire reporting requirements This is based on only 13 states. The
complexity will surely increase when all of the states require new hire reporting.

Exhibit I

State New Hirc/Rchiic Reporting:
Variable Reporting P^()^ isions

Reporting Frequency

Where to Report (agency \aries b\ slate)

How to Report

What to Report

Penalties

Covered Employers

Covered Employees

Who is a "rehire'^"

Agency of Enforcement/Administration

Administrati\e Fees (charged to new hires)

147

3 Frequency of Reporting. New hire reponing should be required no more frcquenll) than monthly
and employers should be allowed to select the date each month that they will report By allowing
employers to select the reporting date, the national and/or state data base won't be flooded with
information-rather, the information will be reported on a staggered basis Requinng that employers
report each pay penod would put a tremendous burden on those employers that pay their employees
weekly It is also our belief that if an employee has changed jobs within 30 days, the state would not be
able to withhold child support anyway. For this reason, we feel that the burden caused by pay period
reporting doesn't justify' the benefits that would be realized by the si.ites

4 Employee Exemptions. Many states with new hire reporting requirements exempt employees who
work sporadically or earn less than a certain dollar amount (eg . $300 per month) from the new hire
reporting requirements We support these exemptions and recommend Congress include similar
provisions.

5 Rehires. States also require that "rehires" be reported Unfortunatcl>. there is no specific or uniform
definition of rehire Some slates have determined that a rehire is any employee with a lapse in pay of one
day This is extreme and burdensome for all panics imoKed Wc suggest that a rehire is any employee
with a lapse in pay of one month or more

6. Method of Reporting Almost all states with new hire reporting requirements allow employers to
report new hires and rehires in a variety of formats magnetic media, printed list. Form W-4. phone or
fax We urge Congress to allow for the same flexibility For some employers the Form W-4 may be a
convenient reporting vehicle, while the large corporation would be better able to supph magnetic media or
pnnted lists We think that where magnetic media is possible, both states and employers benefit

7. Penalties. Penalties for failure to report should not be excessive, and should be consistent with the
information return reporting penalties that currently exist (eg. $50 for each failure up to a maximum of
$2.'>0,000 per year) We also urge Congress to provide for a period of leniency while employers are
prepanng for and learning the new hire reporting requirements

• Software Standards and Edit Criteria. Most employers process their payrolls through some form of
an automated system With this in mind, software standards and edit criteria, where properly promoted
by the Federal Office of Child Support Enforcement, would provide software vendors and pavToll service
providers an incentive for including routines that ensure that child support is withheld correctly and paid
over timely Currently, few payroll systems notify the user when the standard child support payment
exceeds the maximum percentage of disposable pay Some software systems attempt to pnontize wage
attachments, but do it improperly By giving guidelines to software vendors and senice providers, who
are relatively few in number, many employers will be in compliance with the CCPA

• Employer Outreach The laws governing child support withholding and other provisions of the CCPA
are generally not understood by employers We believe that most instances of noncompliance are the
result of ignorance and not willful In light of this, we encourage Congress to develop a program of
employer outreach seminars supported by enhanced publications for employers.

-end-

148

Chairman Ford. Thank you very much.

Let me thank each panelist again for your testimony.

Mr. Melia, you talked about your collection rate in Massachu-
setts, which is very impressive. Have other States adopted or
talked with you about your approach in the collection efforts there?

Mr. Melia. Yes, and there is a fair amount of interest in what
we are doing because it is a way to enforce many more cases with-
out having to hire additional caseworkers, so it gets us out of the
trap that a number of people have mentioned.

In order to do that, the absolute prerequisite is a centralized
child support database. Most States still don't have such a
database. By 1995 most States should be in a position to do that
if they meet the Federal date for having a single comprehensive
computer system.

States also need to have something to match that against, and
the most important or the most lucrative source of data to match
that is a new hire database. Even without a new hire database
States could match it against existing quarterly wage reports. You
would be 3 months behind, but it would be better than what we
have today.

Chairman Ford. Ms. Haynes, is an amendment to ERISA still
needed even if President Clinton's health care plan is enacted into
law?

Ms. Haynes. Well, I don't know the specifics of what the health
care reform will entail, but the testimony that we heard from child
support agencies throughout the country included a lot of problems
where the self-insured employers would not provide insurance cov-
erage if the dependent did not reside with the employee or if the
child was born out of wedlock, and because of the ERISA preemp-
tion, their State statutes prohibiting such discrimination did not
apply to these self-insured plans. So the input that we were getting
is that, yes, it is very necessary to remove the ERISA preemption.

Chairman Ford. Is that right? OK.

Well, I thank the members of the panel for your input and testi-
fying before the subcommittee. Hopefully we will be working in this
area in the coming months and hopefully we will be able to call you
to guide us and direct us in drafting some legislation that would
be in the best interests of child support enforcement. Again, thank
you very much.

Nancy Ebb, the senior staff attorney for the Children's Defense
Fund; Geraldine Jensen, president of the Association for Children
for Enforcement of Support; David Levy, Children's Rights Council,
president, and Paula Roberts, senior staff attorney for the Center
for Law and Social Policy.

Let me welcome you and thank you for coming. I want to apolo-
gize for your having to wait all day like this. I am sorry about the
40 minutes that it took with the three votes on the House floor, but
thank you very much for waiting, and thank you for your testimony
that you are about to give.

Ms. Ebb.

149

STATEMENT OF NANCY EBB, SENIOR STAFF ATTORNEY,
CHILDREN'S DEFENSE FUND

Ms. Ebb. Thank you, Mr. Chairman. The Children's Defense
Fund appreciates the opportunity to testify today.

We believe strongly that the support of both parents is important
for children to thrive and to live with economic dignity. Our long-
standing work to make child support better has led us to believe
that any solution to the child support problem that so plagues chil-
dren in this country must include child support assurance as one
key component.

I would like to start my testimony by reframing the question
Congressman McDermott asked earlier today about federalization:
In the case of child support assurance, why wait? We have heard
a number of common solutions to the child support problem, but
also a number of conflicting theories about what will truly make
the system work for children. As we test out those solutions, as we
debate whether to give State-based child support enforcement one
last chance before moving to federalization, should children have to
bear the burden of continuing poor performance of the child sup-
port enforcement system?

Like you, we have worked long and hard to improve child sup-
port enforcement. We are proud of some of the very significant im-
provements we have seen. We also despair, though, as we look at
the continuing poor performance on behalf of children. Looking at
the IV-D case load, including those cases with orders as well as
those still in need of paternity establishment, we are making collec-
tions in only 19.3 percent of the cases across the country.

If we are trying to make child support what it must be, a
regular, reliable source of support for children, this is simply not
adequate. Why should we wait to move forward with child support
assurance?

The Children's Defense Fund supports a universal child support
assurance program. We advocate beginning with the youngest,
most vulnerable children and phasing it in from there, starting
with the youngest children because they are the ones whose par-
ents may face the greatest barriers to work and ability to support
their children without child support. If that is not possible, though,
for any reason, and we must begin with demonstrations, then we
believe firmly that it is important to look at demonstrations that
are likely to move swiftly toward broader coverage.

We urge if we begin with demonstrations that there be a signifi-
cant number of broad-based demonstrations establishing the viabil-
ity of the approach, expanding rapidly to serve a greater population
as program success is established, and testing out strategies for
replicating the program and expanding it to national scale.

Our written testimony outlines criteria for achieving this result
and for expanding to nondemonstration States as interim evalua-
tions establish program success. We believe as we begin the discus-
sion of child support assurance, we should begin with two ques-
tions, "Why wait, and how can we move as quickly as possible to
support children?"

We believe also as the subcommittee explores design of child sup-
port assurance that it is important to look at how that assurance

150

program should be structured. We would urge that it include five
key program components.

First, dramatically improved child support enforcement. Assur-
ance can't work without strong, aggressive enforcement, and we
think that is a bedrock piece of the program. Working with other
advocacy groups, CDF has developed a proposal for such improve-
ments. I understand that they will submit that statement for the
record so I will not reiterate it today.

Second, an assured minimum benefit should be included that is
enough to make a difference in a child's life. A $3,000 minimum as-
sured benefit for one child and a larger one for larger families
would have a modest but significant impact on children. It would
give a custodial parent enough of a base so that he or she can com-
bine a part-time job or a full-time job with child support assurance
as a viable alternative to welfare. So a minimum benefit that is
enough to achieve that result is an important piece of the program.
It is also vital that families receiving AFDC see some benefit from
child support assurance rather than a dollar for dollar reduction in
order to give them a stake in pursuing employment, training, and
child support as a realistic alternative to welfare.

Third, it is important that child support assurance reach all chil-
dren in need of assistance. For most children a child support order
should be the entrance key to the program. But for some it may
not be appropriate to ask that, for example, in cases of rape or in-
cest. And in other cases despite the parent's best efforts to obtain
a support order that may not be possible. Those children as well
should be deemed eligible for the program.

Fourth, the child support assurance program should include
some form of health assistance for poor and near-poor children. As
Congress looks at both health reform proposals and child support
assurance proposals, it is important to look at the interplay of
those two proposals and to ensure that there will be coverage for
children in child support assurance who don't have access to cov-
erage through other means.

And finally, the program should include strong outreach to custo-
dial and noncustodial parents to reach them, to bring them into the
system and to explain both the benefits and the responsibilities of
child support.

We are encouraged by the subcommittee's interest in child sup-
port assurance. We look forward to working with you and your staff
to make it a reality for children.

[The prepared statement follows:]

151

TESTIMONY OF NANCY EBB
CHILDREN'S DEFENSE FUND

The Children's Defense Fund appreciates che opporcunicy to
testify at these oversight hearings on child support enforcement.
We commend the Subcommittee on its willingness to explore solutions
to the child support problem, a failure of parental responsibility
that blights the lives of millions of children.

The Children's Defense Fund ("CDF") is a national non-profit
group that advocates on behalf of low-income and minority children
and families. We have long been active in the area of child
support. It is our strong belief that the support of both parents
is important for children to thrive and to live with economic
dignity. Regular, reliable child support is a key component in
helping families achieve self-sufficiency.

We worked hard on the child support improvements shaped by
this Subcommittee and enacted as the Child Support Enforcement
Amendments of 1984 and the Family Support Act of 1988. After
federal legislation was enacted, we followed the regulatory process
to try to ensure that the legislative intent of the provisions was
carried through in regulations. We wrote The Child Support
Advocacy Manual: A Guide to Implementing P.L. 98- 378.

We have provided extensive technical assistance to state
administrators, legislators, and child advocates in an effort to
see that federal child support enforcement provisions live up to
their promise. We have done extensive survey work in the area of
child support in an effort to identify both problems and innovative
solutions. Our long-standing work on child support has led us to
conclude that cuiy solution to the problems of children in
single-parent families must include child support assurance as a
key way of helping their families achieve self- sufficiency.

The Crisis in Child Support

The numbers etch in stark relief a picture of children in need
of new solutions. We have seen a national sea change in families.
In 1959, 91 percent of children lived in a two-parent family. By
1992, this number had plummeted to 74 percent.

By 1991, one in every four children lived in a family with
only one parent in the home. Of the 15.7 million children living
in single-parent families in 1991, more than half were poor.
Millions more live close to economic disaster.

The obligation to support a child does not disappear when a
parent leaves the home. Yet appallingly few children receive
support from their non-custodial parents. According to Census
Bureau data, only a slim majority (58 percent) of custodial mother
families had a child support order in 1990. Among custodial
mothers without a child support order, nearly two- thirds (64
percent) wanted a child support order but could not get it. This
proportion was even higher (72 percent) among poor custodial mother
families without an order.

Even families with a child support order are not guaranteed
support :

♦ Among custodial mother families with orders to receive
child support in 1989, half (48 percent) received no
support at all, or less than the full amount due.

♦ In 1989 alone, there was a $5.1 billion national child
support "deficit" -- the total shortfall between the
amount of support American children were due from
noncustodial fathers and the amount they actually
received.

♦ The record is even more disturbing for cases served by
federal-state child support enforcement agencies, which
in FY 1991 reported collections in only 19.3 percent of
their cases. While these agencies certainly have made

152

their cases. While these agencies certainly have made
notable improvements in recent years, they still fall far
short of being able to ensure that child support will be
a reliable source of income for the children they serve.

The Devastating Impact of Nonsupport on Children

Inadequate child support victimizes children by threatening
their immediate economic security. Child support payments are
often sporadic and unreliable, leaving families unable to cover
essential daily expenses such as food and rent.

Child support payments also may be too low to enable working
single parents -- mostly women -- to support their children.
Custodial mothers who work often face low wages (generally less
than those of men) and high child care costs. According to the
Economic Policy Institute, 37 percent of all women earned poverty
wages or less ($6.52 and under) in 1991, compared with 26 percent
of all men. Moreover, the 1990 National Child Care survey found
that employed single mothers spend 21 percent of their annual
income on child care. Many of these low-wage earners cannot earn
enough to keep their children out of poverty. For these families,
the absence of reliable support from the second parent means that
one parent is trying to do the work of two. The work effort of the
custodial parent without help from the second parent often does not
produce family self-sufficiency or a viable alternative to welfare.

The Promise of Child Support Assurance

Child support assurance represents a bold new strategy for
responding to the new realities of American family life. It seeks
to restore our nation's strong historical commitment to parental
responsibility and family values by insisting that every child
receive the support of two patents. At the same time, it seeks to
assure that children do not suffer when parents fail to pay and
government fails to collect child support.

While child support assurance is a new idea, it builds on an
already well-established one. The concept of insuring children
against the inability of a parent to support them is a proud and
long-standing part of our Social Security system. The Social
Security program insures children against the inability of their
parent to support them due to disability or death. Child support
assurance responds to the sweeping demographic shifts that have
taken place since the inception of Social Security to insure
children against the newest threat to their economic well-being --
the current epidemic of non- support among parents who do not live
with their children.

Why Child Support Aaauranee la So Importamt

-Child support asaurance reinforcea parental reaponalbilitv.

making it harder for noncustodial parents to avoid child support
payments. Because child support assurance is premised on much
tougher child support collection, breaking up or never marrying no
longer will provide an opportunity to escape financial
responsibility for one's children.

Moreover, child support assurance gives custodial parents an
incentive to seek paternity and child support orders even if the
noncustodial parent earns too little to make substantial child
support payments initially. This new incentive will help ensure
through early establishment of paternity that children have access
to the noncustodial parent's future income, including earnings,
benefits, and inheritance. Particularly in the case of young
fathers, earnings and child support payments will rise over time,
offering enormous long-term benefits of establishing paternity.

153

Child support assurance encourages work effort and offers
fcunilies a way to support their children without welfare. Child
support assurance removes barriers to work that are embedded in the
current welfare system and supplements earnings with the assured
benefit. Unlike welfare's work disincentives, most child support
assurance proposals are designed so that single parents can keep
the assured benefit even if they work. This means that work effort
by a custodial parent is rewarded by greater family income, and
that the combination of at least part-time work and assured child
support offers a viable alternative to welfare.

Child support assurance is a universal, non-sticrmatizing way
to help children. Unlike welfare, child support assurance helps
all children who now suffer from irregular, unreliable support --
not just those who are poor. The cost of making such a program
universal can be minimized by aggressive enforcement against non-
paying parents, ensuring that those who can afford to support their
children are held to their responsibilities.

Key Components of Child Support Assurance

As the Subcommittee explores design of a child support
assurance program, we urge that it include five key program
components :

♦ Dramatically improved child support enforcement. Child
support assurance cannot work without strong, aggressive
enforcement that holds noncustodial parents responsible
for supporting their children to the maximum extent
feasible .

Improvements that should be made include improved
establishment of paternity and support obligations; improved
location and collection teohniques; shifting key enforcement
elements to the federal level; improved resources and training;
outreach; and better medical support enforcement. Working with
other advocacy groups, CDF has developed a proposal for such
improvements. Because it is our understanding that the groups will
submit a detailed description of these improvements for the record,
we have not described them at length in this testimony.

♦ Ab eaatired minimum benefit that is large enough to make
• difference In a child's life -- and adequate for
faallles with more than one child. The amount of the
assured benefit is key to its success. Since one
benchmark of the program's success is its ability to
improve the economic status of children, it is essential
that the benefit be adequate to achieve its goal.

An adequate benefit is also essential to encourage low- income
women otherwise not convinced of the value of establishing
paternity to come forward and do so because they see appreciable
benefits for their children; to give low-income custodial parents
a sense that work, combined with a child support assured benefit,
is a viable alternative to welfare; and to send the message that
child support is a significant obligation, not a trivial one.

A $3,000 minimum assured benefit for one child -- and a larger
one for larger families -- would have a modest but significant
impact on children. According to estimates by the U.S. Department
of Agriculture, single parents with incomes of less than $30,000
spent an average of $5,030 to cover one child's expenses in 1990;
higher-income families spent an average of $9,330 for one child.
A $3,000 minimum benefit for a single child is therefore extremely
modest in light of actual expenditures.

It is also vital that families receiving Aid to Families with
Dependent Children see a benefit from child support assurance,

rather than a dollar-f or-dollar reduction, in order to give them a

154

stake in pursuing child support and the motivation to pursue job
training, employment, and child support as a viable alternative to
we" fare. Frank Furstenberg, a noted academician who conducted
fc^as group interviews of young black women and some of their male
partners, reported finding a pervasive hostility toward the child
support system. One reason, he found, was the sense that child
support does not benefit AFDC children:

[The] procedure of linking child support to the repayment
of welfare had the effect of making both the father and
the mother feel that the money that came into the system
was not going to support their children. For some men,
this was a further excuse to evade payments; for some
women, the low payoff from the system discouraged them
from cooperating in efforts to locate the father.

Source: Furstenberg, Sherwood, and Sullivan, Caring and Paving,
1992 .

Providing some benefit to AFDC families through child support
assurance is important to reduce t .s hostility and to help
families move from welfare to a less stigmatizing system that
rewards efforts to be self-sustaining. The pass-through of some
child support assurance benefit to AFDC families could be on a
universal basis, or the incentive could phase out as income
increases (similar to the EIC phaseout) . Alternatively,
legislation could follow the approach taken by the National
Commission on Children. The Commission proposed that AFDC benefits
to single parents be reduced by approximately 50 percent of the
amount of the guaranteed child support payment for which they are
eligible. Whatever its precise formulation, we believe that such
an approach is an important part of child support assurance.

♦ Child support assuremce should reach all children whose
parents participate -in child support enforcement efforts.

While eligibility should in general be restricted to
children with a child support order, in limited instances
children should be deemed eligible if there is good cause
not to pursue paternity or support (e.g., in cases of
rape or incest) and in cases where the child does not
have an order because the system has failed to obtain one
despite the custodial parent's cooperation.

♦ Th* assured child support benefit should Include an
assured health benefit. Working parents struggling to
stay afloat need the assurance that they can provide for
their children's health needs. For too many single
parents, medical coverage for their children is a
chimera. In 1991, fourteen percent of all children in
mother-only families had no health insurance. Only
forty-one percent of all such children were covered by
private health insurance, a number which plummeted to 16
percent for poor children in mother-only families.

(Source: Census Bureau, Poverty in the United States:
1991. Series P-60, No. 181, 1992. Calculations by CDF).

While theoretically many of these children can and should be
covered by the absent parent's health plan, in too many instances
that is not the reality. According to Census Bureau data, only two
in five custodial mothers with a child support order in 1990 had
provision for the child's private health insurance included in
their order. Of those families with health insurance included in
their order, one-third did not receive the mandated coverage.

As Congress considers both health reform and child support
assurance proposals, it is essential to look at the interplay of
these proposals and to ensure that they provide adequate coverage
for poor and near-poor children participating in child support
assurance. Health insurance coverage should be provided to poor

155

and near-poor children eligible for child support assurance if chev
do not have access to their noncustodial parents' private health
insurance; if their custodial parents do not have any insurance; or

if the coverage available to them fails to meet basic health care
needs such as preventive health care.

♦ The program should include strong outreach to custodial
and noncustodial parents. Many custodial parents do not know what
their child support rights are, or how to get help establishing and
enforcing them. Local and community-based outreach and public
education is essential to help custodial parents understand that
they have a stake in pursuing child support and child support
assurance, to emphasize the economic and non-economic benefits of
child support, and to help them navigate the system to obtain
services. Outreach to noncustodial parents is important to educate
them about their responsibilities, and about the benefits that flow
from establishing paternity and a formal link to their child.

Implementing Child Support Aseurance

In designing a child support assurance program, one of the
threshold questions is whether it should be a universal program or
a demonstration. We strongly support a universal national child
support assurance program rather than limited demonstrations.

Despite our best efforts to make child support cushion the economic
loss caused by the absence of a second parent, in too many cases it
simply does not provide a regular, reliable source of income to the
child's household. We can - and must - improve our efforts to
collect child support, but children should not be asked to bear the
burden of our failures. Universal child support assurance should
be put into place now so that another generation of children does
not have to wait for national policy to catch up with changed needs
and changed demographics.

A universal child support assurance program can be phased in
(the practice that was followed in extending Medicaid coverage to
non-wel£are low- income children) . Such a phase-in would logically
begin with the youngest children whose custodial parents face the
greatest barriers to full-time work and therefore the most acute
need for income from the second parent. Implementation could be
phased in over a five year period, building experience and capacity
to serve a universal population of all children.

Our strong preference is for a universal, phased- In system.
In the event that Implementation of child support assurance does
not begin with a universal system, we urge that there be a
significant number of broad-based demonstrations that establish the
viability of the approach, that expand rapidly to serve a greater
population as program success Is documented, and that test out
strategies for replicating the program and expanding it to national
scale.

.The selection process for any demonstration project should
place a heavy emphasis on a successful track record of child
support assurance, both to keep program costs down and to emphasize
that private responsibility precedes public responsibility. There
should also be a heavy emphasis on programs that can be replicated
on a national scale. States willing to explore multi-state
approaches that can advance national replication should be given
priority.

If demonstrations rather than a universal program are
authorized, the following criteria should apply to the choice and

156

structure of demonstration projects:

♦ Priority in selection of demonstration sites should be
given to states that have demonstrated pre-eminence in
establishment of paternity and child support orders and
child support enforcement or a recent history of
significant improvement in these areas; to states that
have a demonstrated record of effective automation; and
to states that have made efforts to link child support
systems with other service delivery systems;

♦ Demonstrations should include the key elements outlined
earlier in our testimony;

♦ The state submitting a demonstration proposal should
commit itself to improvements in establishment of
paternity and child support orders and child support
enforcement as a condition of continuing federal
financial support for the child support assurance
demonstration;

♦ There should be a two-tier federal match provision, with
federal financial participation increasing as
demonstration sites reach a given performance threshold
in establishment of paternity and child support orders
and child support collection;

♦ The demonstration should include provision for an interim
and final evaluation of effectiveness;

♦ Participating states should be required to commit
themselves to a demonstration of significant size in
order to meaningfully measure the impact of child support
assurance, and further commit themselves to a plan to
expand the program to a statewide one once interim
reports indicate that the. program is effective. Criteria
for effectiveness should include increased family income;
increased income or hours of work by custodial parents;
and improvement of state performance in establishing
paternity and child support obligations and collecting
child support; and

♦ Enhanced federal funds that are more favorable than the
basic two-tier match rate should be made available to
encourage submission of a multi -state demonstration
proposal ;

In addition to this demonstration authority, there should be
federal authority and matching funds provided to states that choose
to phase In a non-demonstration, statewide child support assurance
progreun as soon as Interim reports In demonstration states Indicate
program success. Federal matching funds should be provided at the
lower of the two basic match rates provided to demonstration
states. This ensures that demonstration sites are rewarded for
initiative and innovation by being able to achieve a more favorable
match rate, but also encourages expansion of child support
assurance to other states as soon as evaluations' establish its
success. This program design, while less desirable than a
universal approach, helps ensure that the successful lessons of
child support assurance are translated into national help for
children.

Child support assurance is a vital part of a strategy to
provide for the needs of our nation's children. Combined with
other approaches that help families move towards self- sufficiency,
as well as strategies that help two-parent families form and

157

thrive, child support assurance -- and more aggressive child
support enforcement -- offer great hope for changing and improving
the lives of children. We appreciate the Subcommittee's interest
in the issue, and look forward to working with you and your staff
to make it a reality.

72-449 - 93 - 6

158

Chairman Ford. Thank you very much.
Ms. Jensen.

STATEMElSrr OF GERALDINE JENSEN, PRESmENT, ASSOCIA-
TION FOR CHILDREN FOR ENFORCEMENT OF SUPPORT, INC.

Ms. Jensen. Mr. Chairman, thank you for this opportunity to
testify today on behalf of the 25,000 ACES members throughout
the nation. We are the famihes who are entitled to child support
payments. I am also a member of the U.S. Commission on Inter-
state Child Support.

In 1975, when Congress enacted child support legislation for the
first time, my son was born. In 1984, when he was 9 years old, you
reviewed the laws and promised him a system that would begin to
collect payments. That did not happen for him nor did it happen
for many millions of other children.

In 1988, ACES came back and told Congress the system is still
broken. He was 13, and again promises were made that he, too,
would begin to receive payments as well as the other millions of
children across the nation.

It is now 1993. He will be 18 next month, and the promise has
not been fulfilled.

When I listen to Members of Congress and those here testifying
who ask for one more chance for State government to try to help
children like my son, I think he has lost all of his chances, and you
risk losing another whole generation by not making the needed
fundamental and radical changes.

In 1988, you asked States to introduce child support guidelines
as a rebuttable presumption. Because of that, the amount of sup-
port paid increased in 27 States, it decreased in 16 States, and it
remained the same in 7, but the guidelines are different every-
where. A family with $30,000 and two children in Illinois will pay
child support of $284 a month; a family with the same income in
Florida will pay $475 a month. This inherent unfairness breeds
State hopping, resentment among noncustodial parents and does
not insure children fair and equitable support across the Nation.

The Family Support Act tried to help children get paternity es-
tablished and obtain orders by providing 90 percent funding. Un-
fortunately, the number of paternities established increased only
18 percent after the higher funding when you compare it to the al-
ready increasing 10 percent per year rate.

ACES members in Georgia and Indiana report that they are
being told they must pay $300 for genetic blood tests. This is im-
possible for low-income single mothers. Since these fees are not
being charged to AFDC families, only to the working poor, many
are literally forced on to welfare to establish paternity and collect
child support.

We must ensure that there are effective and efficient systems in
place in States to establish paternity. States that use administra-
tive process have proven that this works. States that continue to
use the court-based quasi-judicial systems continue to show that it
takes years and years to establish paternity.

Our members report it takes 1 to 2 years for the State welfare
agency to tell the State child support agency that their case even

159

needs paternity established, and then it takes at least another year
for the process to be done. This is unacceptable.

Our children are growing up without any help. Only 13 States
have put in place Statewide child support computer systems.
Thirty-nine States have told ACES in our annual survey that they
will not have computers in place by 1995, and even if every single
State had a computer in place, they were not designed to interlink.
There is no hope that they will be the basis of a national locate sys-
tem or even a national system for child support orders.

The Federal Government blames State government, States blame
the Federal Government. This finger pointing does not help our
children.

Some $257 million have been spent on the computer systems,
$863 million more is being requested.

An example of a recent problem with a computer system is in
Alabama where the OCSE refused to certify it because the child
support computer does not talk to the welfare computer. It could
not calculate arrearages, and it could not distribute payments.

ACES finds it very difficult, if not impossible, to understand how
the Federal and State government could work on systems like this
for years before they notice these basic fatal flaws. Almost one-half
of the States implemented immediate income withholding for non-
IV-D cases and for IV-D cases after the Family Support Act. These
States are not complaining that they are overburdened by having
to process cases for non-IV-D families. The only States that are
voicing this complaint are those who have not taken the action as
of yet.

We would support allowing Federal funding for cases for States
to monitor immediate income withholding for non-IV-D cases be-
cause it is found that if they don't do the immediate income with-
holding, the case will be in default within 6 months, and they will
then have to be tracking down the absent parent and starting the
process all over. That is much more expensive and makes children
wait much longer.

Also, the timeframes that were enacted under the 1988 Family
Support Act have not become reality for families. Just one simple
example of that is in Prince George's County. One of the time-
frames requires the applications be made available upon demand
and cases be opened within 20 days.

Prince George's County child support agency closes and locks its
doors every afternoon. They put a sign on the door that says "no
appointment, no service," they then tell you it is 30 to 45 days to
get an appointment.

The current system is broken. We need a national system which
is Federal, housed in the IRS, that is administrative, not court-
based. We do not want a system to go to Federal court. We want
a system to collect child support just like taxes.

We need child support assurance to help families where they
cannot collect the payments because the parent is not able to pay.
We need you to act now, this year, and not wait another 5 years.

Thank you.

[The prepared statement follows:]

160

TESTIMONY OF GERALDINE JENSEN, PRESIDENT

ASSOCIATION FOR CHILDREN

FOR ENFORCEMENT OF SUPPORT, INC. (ACES)

MEMBER, U. S. COMMISSION ON INTERSTATE CHILD SUPPORT

HUMAN RESOURCES SUB COMMITTEE, JUNE 10, 1993

ACES is the largest child support advocacy organization in the U.S.
We have 300 chapters in 49 states with over 25,000 members. ACES'
members are typical of the 9.9 million families entitled to child
support payments in the U.S. We have joined together to seek
improved child support enforcement, so that our children are
protected from the crime of non-support, a crime which causes
poverty.

America's child support enforcement system fails in almost every
possible way to serve the children. The system needs radical and
fundamental restructuring. 17 million children are owed over $20
billion in unpaid child support. This large amount of debt to the
children is really only about one-half of what is truly due,
because about 45% of the entitled children do not yet have child
support orders .

The 1988 Family Support Act required states to adopt child support
guidelines as a rebuttable presumption. This caused the amount of
support paid to be increased in 27 states, to be decreased in 16
states, and they remain the same in 7 states. Guidelines are
different in all states. For example, in Illinois families with a
combined income of $30,000, have a child support order of $284 a
month, while the same family in Florida will have a child support
order of $475. (Source: Institute for Research On Poverty,
University of Wisconsin, Discussion Paper: Child Support Guidelines
And Their Impact On The Economic Weil-Being Of Our Nation's
Children) .

This lack of fairness breeds state "shopping" and resentment among
non-custodial parents who are ordered to pay various amounts.
Additionally, all states have created "exceptions" to use with the
guidelines. Often these "exceptions" violate federal regulations,
but OCSE has done nothing to make states comply with the federal
regulations. For example, many states only use guidelines for
families with a combined income of under $50,000.

This means that upper income parents pay an amount ordered at the
judges discretion, while low income parents pay a standard set
amount with little deviation. Some upper income parents in this
situation threaten custody battles to coerce custodial parents,
usually women who have a few financial resources to use in a
custody battle, to settle for less child support. Also, some
states allow parents to pay less child support, because they have
a second family, have a college loan to pay off, etc. There is no
uniformity among "exceptions". States have not made sure that the
childrens' financial security is placed first in the divorce
process. Children throughout the nation need to be treated fairly
and equally.

National child support guidelines should be put in place. Adequate
information is available and sufficient experience can be found
from state governments to develop fair national child support
guidelines. Children's support orders should be determined by
their needs and their parent's ability to pay, not by where they
live and which state guideline applies. There must be a national
process, as well, for periodically reviewing and updating child
support orders to ensure that orders keep pace with the children's
needs and the parents' income.

161

The 1988 Family Support Act sought to help familieE establish
paternity and obtain child support orders. State IV-D agencies told
families that they could not assist them to establish paternity and
establish orders, because they did not have the needed funds for
genetic blood testing. So, Congress acted to solve this problem by
providing 90% funding for blood tests. The number of paternities
established is only 8% higher after implementation of the 90%
federal funding (1987-1988 showed a 14% increase, 1990-1991 showed
a 22% increase, difference = 8%). ACES members in Georgia and
Indiana report being told that they must pay $300 for the genetic
tests, this is impossible for most low income single mothers.
Since these fees are not being charged for AFDC families and only
to the working poor, many are being forced onto welfare in order to
establish paternity and collect child support.

Some states are not taking advantage of the 90% funding at the same
time that they tell us they are back logged on cases and don't have
enough resources to process the cases.

We must ensure that each state has in place effective laws and
practices to establish paternity and child support orders,
successful state models which have demonstrated dramatic
improvements in establishing paternity and obtaining support orders
through an expedited administrative process need to be expanded
nationally. These administrative processes are effective for
children on whose behalf paternity must be established and for
children whose paternity is not disputed, but who need support due
to parental divorce, desertion, or separation.

Only thirteen states (lA, MN, NY, SD, VT, WA, CO, CT, MI, ID, RI ,
DE, AR ) have taken advantage of the provision for 90% funding for
statewide automated systems. Thirty-nine state (jurisdictions)
child support agencies told ACES, in our annual survey, that they
will not have automated systems in place by 1995. Even if the
states had an automated system in place, all would be different,
they are not being designed to interlink. There is little hope at
present. Statewide automated systems will be basis of a national
parent locator system or a child support order registry. State
governments blame the Federal Office of Child Support for the lack
of automated systems and the Federal Office of Child Support blames
the states. This finger pointing does not help the children. Over
$257 million has been spent by states developing automated systems,
states are requesting an additional $863 to complete the systems,
this totals $1.1 billion dollars. Much of the money spent
developing the system has been wasted. In a GAO report, it was
shown that one state spent $17 million on a system which did not
work before OCSE suspended the funding, another spent $11 million
over three years on a functions system, and another $4 million over
two years on a system which did not meet federal requirements .

States who have been certified by OCSE report that they need
additional funds to update the systems. For example. New York has
received $33 million, its system was certified by OCSE, yet they
are requesting an additional $25 million to correct the problems.
ACES members in New York report that only child support workers who
have attended classes can use the computer to determine the
arrearages. Courts have to arrange to have a IV-D child support
worker to be present at the court hearings to determine the back
support due. OCSE recently refused to certify the Alabama
statewide child support automated system, because it did not
interlink appropriately with the welfare computer, and because it
did not accurately calculate the arrears and make payment
distributions. OCSE has been funding the development of the Alabama
system for several years. ACES does not understand how the state
and federal government can be working on the systems for years
before they notice basic fatal flaws.

162

Children suffer because states cannot even identify which cases
need orders, or which cases have not received payments so that
action can be taken to implement income withholdings. This is why
only 20% of the cases have income withholding orders eight years
after Congress passed a law making it mandatory upon a one month
default, and four years after this law was expanded to include
income withholding at the time an order is entered.

Almost one-half of the states implemented income withholding at the
time of divorce, or establishment of paternity for all cases, IV-D
and Non IV-D. None are reporting that they are over burdened due
to processing the increased number of payments, the only states
making this complaint are those who have not yet included Non IV-D
cases in the immediate income withholding process. There is no
basis to believe their concerns are valid, when one compares the
states who handle only IV-D cases and those who handle IV-D and Non
IV-D cases. In both situations, only about 20% of the cases have
an income withholding order. Since 59% of Americans work at jobs
which issue regular paychecks, the number of cases where
collections are made via income withholding should be closer to 59%
It appears to ACES that cases where income withholding is
appropriate are simply not processed.

States like Ohio and Michigan, report problems caused by federal
regulations which prohibit IV-D child support funding to be used to
monitor Non IV-D cases and process payments. The regulation forces
states to have two separate accounting systems, one for IV-D and
one for Non IV-D.

ACES believes that it is duplication of efforts and a waste of tax
dollars to have two systems which are exactly the same, just to
ensure that federal funds are not spent on monitoring Non IV-D
cases. If immediate income withholding is not put in place, there
is an 80% chance that payments will stop six months after the order
is entered. The government will spend much more money tracking
down the absent parent and carrying out an enforcement action than
currently spent on obtaining income withholding orders and
monitoring the case. The pilot project funded by Congress in Bexar
County, TX, and studies done in Washington, DC, both showed that
80-90% of their cases are in default within six months after orders
are entered if an immediate income withholding was not put in
place .

Timeframes that IV-D agencies must follow were adopted by OCSE via
regulations. I was one of a thirteen member Child Support Advisory
Committee that the U.S. Department of Health and Human Services
gathered together to help write the timeframes.

IV-D Child Support Agencies in all states are non-compliant with
the timeframes at least in part, many are totally non-compliant.
This is reported to ACES by our members and by the State IV-D
Agencies who have told us they have no plans of meeting the
timeframes until they have statewide child support computer systems
in place. In fact, one county in California has installed a
computer program to identify cases not meeting the timeframes.
Workers begin to work on cases only after they exceeded the
timeframes .

Examples of problems caused by non-compliance with the timeframfes
are:

Application by non-AFDC clients are to be available upon demand.
In Prince George County, MD they lock the door of the child support
agency in the afternoon and placed a sign out front which states,
"no appointment, no child support services". It takes 30-45 days to
get an appointment. Neither OCSE or the State of Maryland have done
anything to make Prince George's County comply with the timeframes
in response to ACES members complaints.

163

Applications are suppose to include a description of services
available, person's right's and responsibilities, state policy on
fees, costs and distribution of collections. ACES has yet to find
one state which complies with this requirement. In Maine, they are
requiring clients to sign a contract to receive services. OCSE has
done nothing to correct the problems .

Cases must be opened by IV-D within 20 calendar days of the
application or referral. Case opening includes: establishing a
case record, assessment of case to determine action needed,
solicitation of needed information from custodial parents and other
relevant sources. Also includes: initial verification of
information such as, employer, etc. If location information about
the non-payor is known, IV-D must proceed with enforcement/
establishment action, if location is unknown they must refer the
case for location attempts. ACES knows of no state that meets this
requirement. In fact, ACES members routinely receive letters from
Texas and Florida IV-D agencies telling them not to contact them
for six months about case information.

Parent locator timeframes require states to do a locator quarterly
when previous attempts were unsuccessful. Defines location as
finding the physical whereabouts of the absent parent or the absent
parent's employer, other sources of income or assets as necessary
to take next appropriate action.

Section 303.3 (b) requires IV-D agency to use appropriate federal,
interstate, and local location sources such as state agency
records, etc. All sources must be checked within 75 days. This
includes using the Federal Parent Locator and seeking a State
Parent Locator from the state where the absent parent lives.
States are to refer the case to the state central registry for a
State Parent Locator within 20 days of determining that the absent
parent is in the other state. The state in which the absent parent
resides must attempt to locate the absent parent at least
quarterly .

CFR Section 303.3(b)(5) requires state IV-D agencies to do State
Parent Locators quarterly on all cases and to submit the case
annually for a Federal Parent Locator.

Federal Regulations issued in October 1992, requires a $1 fee from
states for each case submitted for a Federal Parent Locator. State
IV-D agencies refuse to submit names because of the cost.

Establishment of Paternity and Support Obligations timeframes
require that paternity be established or the punitive father be
excluded within one year after located. ACES members report that
the average length of time to process a paternity case is three
years. Often it takes one - two years for the AFDC agency to send
the case to the Child Support Agency who then takes another year to
process the case.

Establishment of Support Obligations timeframe requires IV-D
agencies within 90 calendar days of locating an absent parent or of
establishing paternity to establish an order for support. If legal
service of notice is needed it must be completed or documented that
attempts of legal service of notice have been made. States must use
diligent efforts to obtain legal service of notice. Support orders
must be established within 90 calendar days of successful legal
service of notice.

ACES knows of no state who complies with this timeframe, the
average length of time it takes a caseworker to prepare a case for
court is six months, then it takes 4-6 weeks to get a court date.
ACES court monitoring project showed the following results: cases
are continued about 30% of the time, the non-payor no shows 30% of
the time, and about 20% of the time all needed information is not
available and the hearing has to be rescheduled.

164

Enforcement of the support order timeframes require IV-D agencies
to monitor cases and to be able to identify delinquencies of one
month or more, this monitoring includes child support payments and
health insurance. 303.6(b) requires the IV-D agencies to maintain
and use an effective system for identifying cases in default.
303.6(c)(1) requires states to start income withholding
administratively if appropriate or take any needed enforcement
action within no more than 30 calendar days of identifying the
delinquency, this includes beginning location attempts. If legal
service of notice is needed the IV-D agency must complete it or
document unsuccessful attempts. If legal service of notice is
needed and successful or if it is not needed, the action to enforce
must be completed within 60 days of the identification of the
delinquency .

ACES surveyed all State IV-D agencies, all told us they can not
meet this timeframes. They might be able to do so when statewide
automated systems are in place.

Most states are meeting payment distribution timeframes for Non-
AFDC cases. They are not meeting timely distribution of the $50
disregard. In fact, OCSE revised regulations requiring the first
$50 paid to be distributed within 15 to 30 days. Many states
continue to fail to comply.

Case Closure Criteria which is part of the timeframe regulations is
being met in most states. However, some states list clients
uncooperative and threaten them with case closure if they complain
about slow or ineffective service, and some states refuse to
collect back support due for children over age 18, even though
federal regulations require such action and other states fail to
meet the 60 day notice to clients.

THE FUTURE; PROTECTING CHILDREN FROM POVERTY CAUSED BY NON-SUPPORT

A national system for reporting new hires via W-4 Forms should be
developed. W-4 Forms should be matched with a national child
support registry, to ensure that income withholding is done quickly
and effectively.

This system of income withholding, payment collection, distribution
and enforcement of orders should be placed under the IRS.

We must send a national message that supporting children is a
fundamental responsibility as important as paying taxes. This
national agency must be given all the tools it needs, including
improved information for locating absent parents and improved tools
for making prompt and effective collections, to aggressively pursue
child support and medical support for children.

The Federal Office of Child Support Enforcement should be placed in
the IRS. An Assistant Tax Commissioner should be appointed to be
the Director of the IRS Child Support Division. Initially, the
division would take over current duties of OCSE. In one year, it
would be required to have set up a central registry of interstate
case orders and do interstate income withholding. Within two
years, all new cases would be added to the registry and income
withholding process, within five years the system should be fully
functioning and include all child support cases.

Critics of federalization states that, "We have invested billions
of dollars into state child support systems, changing it to a
federal system would be a waste and state child support workers
would be out of jobs". ACES believes that continuing to throw good
money after bad is not good policy. States have proven their
inability to run an effective child support enforcement system, the
national collection rate is only 23%. The argument not to change
sounds like; we must continue to make B52 bombers even though they

165

are obsolete, because if we change B52 bombers employees would lose
their jobs. We can retrain workers and make sure that they have
jobs in the new system. We cannot replace childhoods lost to
poverty .

Children are the innocent victims of family break ups and they
should be protected from poverty. We should adopt a Child Support
Assurance program that guarantees that child support will be a
regular and reliable source of income for children with an absent
parent .

A system like social security is needed for children entitled to
child support, to insure that they receive regular payments even if
the non-custodial parent cannot be found or cannot pay due to
unemployment. This Child Support Assurance program will reduce
poverty in the U.S. by 42%.

Children need to be put before all other debts and support payments
due to them and no statue of limitations for collections should
apply. Federal law should prohibit statute of limitations on child
support cases. Commission recommendations extend collection for 20
years, this is actually less than what some states have now under
judgement renewal laws.

Studies show that the best way to end the cycle of poverty is
through education. Children growing up in single parent households
entitled to support have fewer opportunities for higher education.
A federal statute making duration of support to age 23, if the
child is attending school is needed.

An expbinded federal pareut locator system should be aeveloped. This
can be done by adding NLETS and NCIC to the existing Federal Parent
Locator System and by increasing access to the system by government
child support agencies. Recent regulations done by HHS, requires
the states to pay for information from the federal parent locator
system and fees for use of the national system by any government
law enforcement agency working on child support cases should be
prohibited. Child support agencies need access to NLETS, this is
the system that accesses all of the State Department of Motor
Vehicle records and NCIC which lists the crime records. This can
be accomplished by Congress designating child support agencies as
law enforcement agencies.

This lack of staff and funding severely hinders child support

enforcement efforts and acts as another barrier to low income

families attempting to utilize government services for child
support enforcement.

A new funding structure for states to ensure that they establish
orders on a timely basis should be developed. This should include
elimination of the federal incentive payments to the states, and
the adoption of a 90% federal match with a requirement for state
maintenance of effort at current levels.

Priority of distribution on post AFDC cases should be "family
first." Assisting families who become self-sufficient .^-.d fr.^ of
the welfare roles should be a priority. The current system
penalizes these families by paying the state government back
support payments, before the family receives the back support
payments due to them.

States and the Federal Government benefit through lower cost for
AFDC (Aid to Families with Dependent Children) when child support
is collected. As of the end of 1991, all states made a "profit" on
child support collections: 66% reimbursement + 6% incentive
payments + funds recouped for AFDC expenditures = more $ than what
was spent on the child support enforcement program. They can
afford to pay families first.

166

Example of making a "Profit" on Child Support Enforcement:

Expenditures of $27,086,106

Reimbureement at 66% 1. $17,876,830

Collections: $30,191,573 AFDC

$57,562,494 Non-AFDC

* Amount qualifying for incentives -

$60,500,000 @ 6% 2. $3,630,000

Amount of AFDC recouped by state 3 . $9,226, 858

Total Income (1 + 2 + 3) = $ $30,733,688

Total Income $ 30,733,688
Total Expenses -27.086, 106
"Profit" $ 3,647,582

* Incentive payments are based on the AFDC amount x 2, if less
money is collected on AFDC cases than Non-AFDC cases. This is
often called the "cap."

Profit made on child support enforcement should be reinvested in
the child support enforcement program.

The government child support agency should list their clients as
the custodial parent and child. Child support enforcement services
should be an entitlement. Families should have a right to
effective and efficient services. New federal timeframes are a
step in that direction, except clients were given no rights in the
1988 Family Support Act to obtain action on their cases under the
timeframes. Clients should be given a right to services, and
states should be required to meet the timeframes. Non-compliance
with timeframes should be a reason to request for a state fair
hearing. States should be prohibited from charging fees of more
than $25 to families owed support.

Child support and visitation are two separate issues. A parent who
is unemployed and without income cannot pay support, this parent's
rights to visitation should be protected and enforced. ACES
believes that it is wrong to deny visitation when support is not
paid and we believe it is wrong to withhold support when visitation
is denied. These actions harm the child. We know from our
experience and from studies that 13% of the parents who fail to pay
child support state that they ar^' withholding payments because the
visitation is being denied. To prevent this from happening, we
need an effective custody visitation dispute resolution program.

State courts should be required to have in place programs for
resolution of custody and visitation problems. Prince George's
County, MD, and Washington, DC, are good models for these types of
programs .

PROBLEMS WITH RECOMMENDATIONS BY U.S. COMMISSION ON
INTERSTATE CHILD SUPPORT

The direct income withholding process as recommended by the
Commission on Interstate Child Support is flawed. It requires a
non-payor to contact the child support agency in the state where
he/she resides to resolve problems, such as; incorrect amount of
support being payroll deducted or not owing child support. This
will not work, since only the state issuing the order can correct
these problems. Also, the Commission calls for employers to issue
income withholding checks directly to the payee. This would mean

167

that the 3,000 weekly income withholdings being done by the GMC
Factory in my hometown, would be by individual checks to different
people rather than the one transaction to the county child support
agency .

Instead of the county distributing payments to the families, GMC
will have to take over this duty. Some of these checks will be for
AFDC families, so Jeep will have to be told by the state agency
which checks to send to the families and which to send to the
state. Since the average length of time a family is on AFDC is 17
months and because many families are on AFDC more than once, GMC
will certainly be kept busy sorting out who gets which check when.
This distribution system being promoted by the Commission is to
ensure that private attorneys can act as reception sites for
payments collected via income withholding. Then they can take
their fee out of the child support before passing it on to the
family .

This proposed system is way too burdensome to private industry.
Income withholdings should be managed by the IRS. It would not be
a hardship to businesses like the Commission recommendations, since
it would be part of an already existing tax collection system.

W-4 reporting of new hires as recommended by the Commission does
not help solve enforcement problems on interstate cases. W-4 Forms
will be sent to State Employment Service Agencies by employers.
These agencies will then send them to the State Child Support
Agency to match it with the child support records. Not all child
support orders will be on file, because the Commission's plan
includes only AFDC cases and Non-AFDC cases who choose to use the
system. Those who opt in are given the choice of the W-4 match
being reported to the client, their attorney or the IV-D agency.
This scheme is unpractical and unworkable. Millions of cases will
get lost between the State Employment Service Agencies and Child
Support Agencies Non-AFDC clients will be told by their private
attorney's not to sign up with the state, that it is better to have
a private attorney handle the match.

In reality, the only thing that private attorneys will do better
than the state government is to collect a fee from families owed
support. The lack of a universal child support enforcement system
will continue to be a barrier to families in need of support since
most of these families are AFDC recipients for part of their
child's life. But most of all, the fault of this plan resides in
the fact that the states will only have their own state child
support orders on file, therefore, if a non-payor leaves the
original state, records in the new state which is doing the match
will not list the order. For example, if the order is originally
entered in New York and the non-custodial parent moves to
Connecticut to work, the W-4 matched with Connecticut records will
not show a child support obligation, only New York records would
show a match.

Jurisdiction being basad in the state where the non-payor lives
rather than in the state where the child lives, gives home court
advantage to the parent who has abandoned the child, the law
breaker. The jurisdiction system recommended, long arm statues,
would encourage people to go to court in the state where they had
sexual intercourse rather than in the state where the child lives.
For example, if a couple went to Florida on spring break and
conceived a child, and the Mother went home to Virginia and gave
birth and the Father returned to his home state of Michigan, the
jurisdiction plan of the Commission would allow the case to go to
court in Florida where the child was conceived or Michigan where
the father lives. The case could not be taken to court in Virginia
where the child lives. The Commission states that this gives the
family more choices. ACES believes this gives attorneys more
places to argue jurisdiction and gives non-payors more places to
run and hide. It certainly does not give the custodial parent one
place to count on to help them establish an order, nor does it

168

provide tax payers any accountability to ensure that efficient case
management occurs .

Jurisdiction to establish orders should be in the state where the
child lives. This requires federal statues which place jurisdiction
of child support action to establish and/or modify orders in the
place where the child resides. A National Jurisdiction Act should
have the following provisions: (1) interstate child support cases
to be cause of action, (2) the venue for the action to be where the
child resides, and (3) trial court of any state should have power
to serve the defendant. Parental Kidnapping Prevention Act is a
model for child state jurisdiction.

The Commission had four law professors tell us that there is no
constitutional impediments to national jurisdiction, one told us
there could be a constitutional problem. The Parental Kidnapping
Act overcame this problem. Actually, the discussions in which the
decision was made to reject national jurisdiction evolved around it
"just is too big of a change, that it would upset attorneys and
judges" .

In order to ensure an efficient system to establish paternity and
orders, state child support IV-D structures should be required to
be "single"-statewide. Audit failures by states show patterns of
lack of services statewide in states which are state supervised
county-run programs: WI , MD and PA have been found not to provide
statewide services. CA, NJ, CO, IL, IN, MD, MI, MN, NE, PA, TN, OR
and OH have been found to have problems with establishment of
orders and collection/distribution of support payments.

Administrative establishment and enforcement was not endorsed by
the Commission, even though testimony and statistics showed that it
was more effective than judicial based. This is further evidence
of the Commission's efforts to ensure full employment for attorneys
at the expense of children. Commission members were from the
national office of the ABA and the California, Oregon and Texas
ABA. Only four members of the Commission were not attorneys.

Child support enforcement and establishment actions should be
administrative rather than judicial whenever possible. The
Commission recommends that the choice of law should be placed in
the state where the non-payor lives rather than the state where the
child lives. These orders will be based on the cost of raising the
child, the cost of day care, and the cost of food and shelter, in
the state where the non-custodial parent lives rather than the
state where the child lives.

American families entitled to support need an effective and fair
enforcement system. The children need it to survive, to grow up
secure and safe. It is time to solve the problem of non-support.
We can do it, we have the resources and ability. We need to set up
a national system, which is administrative rather than judicial,
and a Child Support Assurance program to protect children from
poverty. It is the right thing to do for our children.

169

Chairman Ford. Thank you very much.
Mr. Levy.

STATEMENT OF DAVID L. LEVY, PRESmENT, CHILDREN'S
RIGHTS COUNCIL

Mr. Levy. Hello, Mr. Ford. It is a delight to see you back as
chairman.

Chairman Ford. It is good to be back as chairman.

Mr. Levy. Great. I would like to briefly acknowledge our college
student interns, Mike Wilkens, University of Redlands; Monya
Vuletic, Stockton State University; Mark Funaki, Duke University;
Susan Laufer, Cornell University; Jennie Givens, Furman Univer-
sity; and Emily Hadlow, Smith College

Chairman Ford. Are these people in the room?

Mr. Levy. Yes, and office staff Lynn Nesbitt, LaJuan Sykes,
Anna Gbedegbebou, please rise.

Thank you, Mr. Chairman.

Three national organizations are affiliated with our Children's
Rights Council, and they have authorized me to add their support
to the statement I am making today. They are Mothers Without
Custody, headed by Jennifer Isham of Illinois. Mothers Without
Custody represents 2 million noncustodial mothers. They have
chapters in more than 20 States. Grandparents United for Chil-
dren's Rights, headed by Ethel Dunn of Madison, Wis. Grand-
parents United for Children's Rights has chapters in about 20
States. Also, the Step-Family Association of America, headed by
Judith Bauersfeld, Ph.D. of Pittsburgh. SAA is headquartered in
Lincoln, Nebr.

In addition, our Children's Rights Council has chapters in 23
States, half headed by women, half by men. All these groups are
part of a growing national network that wants a better support sys-
tem that includes financial as well as emotional support for our
children and grandchildren.

Mr. Chairman, earlier you predicted that this witness would
comment that the AFDC program is swelling the already swollen
national debt. I am glad to see that some other speakers also have
made this criticism. Congressman Santorum also acknowledged a
report prepared last year by Representatives E. Clay Shaw, Nancy
Johnson, and Fred Grandy which found that the APDC system is
a net loss for the taxpayers, and thus is increasing the national
debt.

We also find this acknowledgment in the HHS, 16th annual re-
port to Congress, but it is buried on page 6. Page 6 acknowledges
that the reductions in AFDC benefit costs do not offset all expendi-
tures. In other words, up goes the debt.

Of course, the States are making a profit from the system. In
1991, for example, California made $81.5 million in welfare reim-
bursements and incentives to collect, as reported in the 16th an-
nual report to Congress. So States may want to keep the current
system going. It profits them if not the children they are sup-
posedly serving. But as the citizens of those States wake up to
what is happening, perhaps you may have a change.

"From a Federal budget perspective the child support enforce-
ment is an expensive disappointment," says the report from Con-

170

gress Members Shaw, Grandy, and Johnson. A report provided by
Democratic Members of Congress by the General Accounting Office
also offers grim findings.

In the report prepared at the request of Congresswoman Rou-
kema, Congresswoman Kennelly, and Senator Bill Bradley on
interstate child support cases released January 9, 1992, 66 percent
of mothers with a child support order, who did not receive payment
from the father, say it is because the fathers were unable to pay.

The 66 percent figure is reported by custodial mothers whether
the fathers are in State or interstate; and as ridiculous as it may
sound, that same GAG report cited in my written testimony reports
that our Government is classifying deceased fathers as deadbeats
as well as counting children due support who are already emanci-
pated.

Also, for years researchers have been complaining that the Cen-
sus Bureau only asks custodial mothers how much they receive. It
does not ask noncustodial fathers or noncustodial mothers how
much they pay or custodial fathers how much they receive.

We are basing public policy on one quarter of the pie. I know of
no other area of government where there is such inadequate data
to frame public policy. It is the reason why child support data is
considered to be junk science. Junk science is poor data and poor
data makes poor public policy.

In another report called "Caring and Paying," Frank F.
Furstenberg and other researchers find other enormous problems
with the system, find it unresponsive to both parents, custodial and
noncustodial. Sanford Braver, a leading researcher from Arizona
State University, states personal power over the children's upbring-
ing is a major indicator of child support compliance, and by that
he means involvement in the child's life.

The Census Bureau confirms that fathers with joint custody and
visitation pay far more in support than fathers without joint cus-
tody and visitation, and I am sure if you surveyed the 2 million
noncustodial mothers, you would find the same results.

The Casey Foundation recently ranked States by child wellness,
and our Children's Rights Council made a correlation of States
with the greatest number of single parent households. There is a
direct correlation. The States with the highest amount of poverty
and other indicators of lack of wellness have the highest number
of single-parent families. Poverty is the symptom, single-parent
families are the cause. More two-parent families, as Barbara
Whitehead said in the April 1993 issue of Atlantic Monthly, may
be the answer.

Dick Woods, administrator of the Iowa access demonstration
grant from the Federal Government, one of seven access grants
provided in section 504 of the Family Support Act, is producing a
lot of information. The Federal evaluators are very pleased with
how this may point us in new directions to better handle
postdivorce situations.

Some groups who testify before you cannot afford to tell you
what I am telling you because they may believe that custodial
mothers do not want to hear that America needs a different ap-
proach. All I can say is that there are an increasing number of
women, such as the women heads of the three national organiza-

171

tions I referred to, who are part of a growing national movement
that want better data, more focus on two-parent famihes, more
work programs, more mediation and more treating of parents as
people who love their kids and want to do well by them.

We suggest you not rush into any new financial support legisla-
tion this year. Instead, study the data that exists, evaluate some
of the child support programs authorized in 1988 that are only now
going into effect, and collect better data.

Just a word about Prince George's County, Md., that the previous
speaker mentioned. I live in Prince George's County, and our Chil-
dren's Rights Council was the catalyst for a wonderful program op-
erating there on visitation mediation, which has an average settle-
ment time per case of about an hour and a half, a cost of only $25
per case, and keeps its kids and parents out of court.

Linda Botts, the head of the child support office in Prince
George's County, is enthusiastic about this program. It is an exam-
ple of how Prince George's County has taken the lead, along with
the Friend of the Court in Michigan which was referred to earlier
today, to try to balance the system. And Debbie Stabenow, who is
running for Governor in Michigan is strongly supportive of balance.
Thanks partly to Ms. Stabenow, Michigan's statute refers to both
visitation and support together.

It is time to end the warfare between the sexes which has subtly
underlined so much of this debate. It is time for a win-win situa-
tion, and I hope my good friend. Congressman Albert Wynn will
not mind my referring to the win-win situation that we need.

Thank you.

[The prepared statement follows:]

172

Testimony before the
Human Resources Subcommittee
of the House Ways and Means Committee
Thursday, June 10, 1993

By David L. Levy, Esquire
President, the Children's Rights Council

Our Children's Rights Council (CRC) favors family
formation and family preservation, but if families break up,
we work to assure a child the two parents and extended
family the child would normally have had during the
marriage. Our advisors include Dear Abby, Vicki Lansky,
Joan Berlin Kelly, and Senator Dennis DeConcini.

Three national organizations area affiliated with our
CRC. They are:

* Mother Without Custody (MW/OC), headed by Jennifer
Isham of Illinois. MW/OC represents 2 million non-custodial
mothers;

* Grandparents U.dted for Children's Rights (GUCR),
headed by Ethel Dunn of Madison, Wisconsin. GUCR has
chapters in about 20 states;

* The Stepfamily Association of America (SAA) , headed by
Judith Bauersfeld, Ph.D. of Pittsburgh, Pennsylvania. SAA
has about 65 chapters around the country.

In addition, our Children's Rights Council has chapters
in 23 states, about half headed by men, and half by women.
Our seventh national conference in April featured major
researchers from around the country in the child and family
area; and we were pleased at the fine column that featured
our ideas by nationally syndicated columnist William
Raspberry in early May, 1993.

I talked with Congresswoman Marge Roukema recently and
she said that she and Senator Bradley and other members of
Congress thought they had fixed the child support system in
1984 and when they found they hadn't, they thought they had
fixed it again in 1988>" and now they find they still haven't
fixed it, so they will have to do so again now, in 1993.
Other members of Congress have expressed similar
frustrations .

In a report entitled "Moving Ahead How America can
Reduce Poverty Through Work," prepared by Representatives E.
Clay Shaw, Nancy L. Johnson, and Fred Grandy, Republican
members of the Human Resources Subcommittee in June, 1992,
those members said "...even though the government Child
Support Enforcement program, subsidized by tax dollars, is
collecting more and more money, there has been virtually no
change in the nation's aggregate child support payments in
relation to the number of demographically eligible mothers,
it's as if the government program is pulling cases out of
the private sector, providing them with a public subsidy,
but not improving overall collections."

173

The Report also states that the federal and state
outlays and state savings in the AFDC system now produce a
net loss to the taypayers, and that this has been true for
three years — 1989, 1990, and 1991. In other words, the well
went dry three years ago! How many members of Congress know
that? How many members of the media and the public know
that? How many know that this is another reason that our
national debt keeps going up.

Of course, the states are making a profit from the child
support system. In 1991, for example, California made $81.5
million dollars in welfare reimbursements and incentives to
collect, as reported in the 16th annual report to Congress
by the Office of Child Support Enforcement, U.S. Health and
Human Services.

So the states may want to keep the current system going-
-it is a profit center to them, if not to the children they
are supposedly servicing. But the citizens of those states,
if they know what a bureaucratic mess has been created,
which is increasing the national debt, might well be upset.

And Congress ought to be upset, too.

"From a federal budget perspective, the Child Support
Enforcement is an expensive disappointment," the report from
Congressmembers Shaw, Grandy and Johnson says.

A report provided for Democratic congressmembers by the
General Accounting Office also offers grim findings. In the
report, prepared at the request of Congresswoman Roukema,
Congresswoman Barbara Kennelly and Senator Bill Bradley on
interstate child support cases, released January 9, 1992, 66
percent of mothers with a child support award who did not
receive payment from the fathers say it is because the
fathers were unable to pay!

The 66 percent figure is reported by the custodial
mothers regardless of whether the fathers live in the same
state or in a different state or in a different state from
the mothers. This is in Report GAO/HRDD-92-39-FS .

As ridiculous as it may sound, that same GAO report
states that our government is classifying deceased fathers
as deadbeats, as well as counting children due support who
are already emancipated! The deceased, those living in
foreign countries and those who have moved back in with the
mothers, are classified as living in "other" locations.
None of those categories constitute more than 14 percent of
the questionnaires reviewed. So as many as 28 percent of
fathers classified as living in "other" locations could be
either living with the mother or dead, the GAO report
states .

In another report, called Caring and Paying, Frank F.
Furstenberg and other researchers find that many parents,
custodial and non-custodial, are ill-equipped for work and

174

face formidable obstacles in the job market. The report
states that the government's goals of increasing family
incomes for children in poverty, and removing those same
families from welfare rolls, are often starkly
contradictory. The report admits how unresponsive,
impersonal and complex our society's child support
institutions are.

On this note, Sanford Braver, a leading researcher from
j^rizona State University, states that personal power over
the child's upbringing is a major indicator of child support
compliance. In other words, how active are you in your
child's life? The Census Bureau confirms Braver's findings,
in the figures last year that 90.2% of fathers pay their
child support, 79.1% of fathers with visitation pay their
child support, and only 44.5% of parents with neither joint
custody nor visitation pay child support.

In a related issues, the Casey Foundation recently
ranked states by poverty. The head of our Children's Rights
Council of Georgia, Sonny Burmeister, correlated the state
poverty rates with the states shown in other demographic
sources as having the greatest number of single parent
households. He found that the states with the greatest
number of single parent households also were the states with
the highest poverty. The states with the smallest number of
single parent households had the lowest poverty rates.

I mention this because to the extent that child support
is seen as an answer to poverty, and the problems of single
parents, it just isn't so.

Poverty is the symptom, and more two parent households
are the answer, as the landmark article in Atlantic
Monthly's April, 1993 article by Barbara Whitehead pointed
out. The attempt to lay poverty at the child support
doorstep is just additional misinformation!

It is similar to the problems of drugs and crime and
schools, where children of single parent households are
overrepresented in the statistics. Child support
unconnected to parenting is another form of assistance to a
single parent household. Understood in that light, child
support unconnected to parenting will be a failure for the
same reasons that the increase in single parent households
have been a rising problem for the past 25 years. Single
parents do all they can for their children, and many
children of single parents turn out fine, but statistically
such children are much more at risk than children in two
parent homes.

Dick Woods of Iowa, winner of one of the access
demonstration grants in Section 504 of the Family Support
Act, is finding that parent education and information for
parents on how to better handle access/visitation questions
after divorce, is doing a great deal to help with parent
child relations. Officials in HHS and the federal
evaluators of the Dick Woods's program, who have spoken at
our CRC national conferences, are also pleased with Woods'

175

work. We have heard it said that the preliminary report by
the federal evaluators, which is due later this year, may
shed light on the complex interrelationships between access,
support, and other family issues.

The battleground used to be over divorce. That
battleground has now shifted to custody. My fellow
attorneys make out, but the children lose. By allowing that
battleground to continue, with little or no attention paid
to education, mediation, and parenting after divorce, we
worsen the problem for children on all fronts, including
f i nancial .

The child support system is out of control. It costs
billions of dollars, costs more than it is bringing in child
support, and is not helping children. What it is doing is
perpetuating a costly federal and state bureaucracy,
increasing the national debt, and worsening the problems for
society .

Some groups who testify before you cannot afford to tell
you what I am telling you, because their success with their
constituencies depends on picturing financial child support
as a simple matter of turning the screws, and tightening the
collection procedures, and then all will be o.k. The facts,
unfortunately, don't support that belief. And now Congress
knows it. Congi ss knows that you can't see one issue in
total isolation from everything else. Congress knows, for
example, that welfare is related to work, that spending is
related to the deficit, and that child support is supposed
to help children, but the groups before you today have
successfully sold you a program unrelated to success. The
greater the lack of success of the program, the more they
want you to sell more of the same old snake oil — at
tremendous public cost.

I don't like deadbeats, and if the programs now in place
got deadbeats to pay up, I would say, good work--parents owe
their children financial and emotional support, and if the
government can get it out of them the way it is going, fine
with us. Our Children's Rights Council has many other
things it is working on, from child immunization, to kinship
care, to mediation and education for parents, and if we can
spend our time on those issues, we have plenty to do.

But with a proven lack of success to the financial child
support program, and the deficit and spending climbing, a
savvy President and Congress cannot afford to continue with
a failed approach.

We suggest that you not rush into any new financial
child support legislation this year. Instead, study and
absorb the data that exists, evaluate some of the child
support programs from 1988 that are only now going into
effect, and figure out where you need better data, as a
means of better informing public policy. Then enact that
better public policy. The children of this country deserve
it. Thank you.

xxxxxxxx

176

Chairman Ford. Thank you very much.
Ms. Paula Roberts.

STATEMEP^ OF PAULA ROBERTS, SENIOR STAFF ATTORNEY,
CENTER FOR LAW AND SOCLAL POLICY

Ms. Roberts. Thank you. I appreciate the chance to be here.

I have some written remarks that are in the record and I think
rather than going through those, I want to make some observations
on what I have heard here this morning.

I do not envy you your task. From my notes, I can see that what
we have heard this morning from Representative Kennelly is that
we should give the States one more chance to reform the system.

Mr. Grubbs, on the other hand, says he was in a State, Texas,
which put significant amounts of money and tremendous political
will into improving the system, and they concluded it couldn't be
done.

Mr. Wolf testified and extolled the virtues of the State system be-
cause it gives access to custodial and noncustodial parents and
gives everyone a chance for individual representation.

That was followed by a presentation from Mr. Melia, who
extolled the virtues of his State system because it is completely
automated and doesn't need caseworkers.

Ms. Haynes, Mr. Jackson, Mr. Henry all told you vou needed to
improve the State system, and that we also needed to add a lot
more staff in order to make the system work. Another witness
opined that we shouldn't federalize because we would need 40,000
new employees to do that.

Indeed, I find my head spinning, and I wonder what you are to
make of all of this. Well, I would suggest that perhaps what you
should make of it is this: What we have right now is a 15th century
child support system imposed on 21st century realities. What we
need is to fundamentally rethink and restructure that system. And
fundamental change scares all of us because we are used to dealing
with a State-based dinosaur of a system that continues to lay some
fairly gigantic eggs.

What I have suggested in my written testimony is that one of the
places that we should start making fundamental change is federal-
izing the collection of child support. That is, at the point where the
State system has done its job and obtained an order the Federal
Government should collect and disburse payments.

To do this, we need to create a national registry of all child sup-
port orders. We could do that in a systematic way, beginning per-
haps in 1994 with new orders, and thereafter adding new orders
and orders as they are modified so that over time we would build
up a national registry within IRS. It could then enforce those or-
ders through immediate income withholding for all wage earners.

To do that we would have to eliminate the opt-outs in current
law that allow people to bypass wage withholding. The child sup-
port system would then function the same way as taxes and Social
Security function for wage earners.

For tnose who are self-employed, the IRS has an existing system
which collects quarterly payments, prepayments of estimated liabil-
ity. It is certainly not difficult — from the child support order — to
figure out what tnat liability is and set up a system that the self-

177

employed prepay child support quarterly, the same way they pre-
pay their taixes.

For those folks who are neither wage earners nor self-employed,
but who do file tax returns, the IRS does have in its files informa-
tion about where their bank accounts are, where they own prop-
erty, what their other sources of income might be. Just as it is now
authorized to use that information to pursue those who are avoid-
ing their tax obligations, IRS could use that information to pursue
those who are not paying their child support and for whom wage
withholding and quarterly prepayments are not available remedies.

If Congress coupled this with a W-4 system where all employers
sent a W-4 form to the IRS every time they hired or rehired an
employee, you could create a system where anyone who changes
jobs, be it within a State or across State lines, would be imme-
diately pulled into the income withholding system. This would ad-
dress the problem that now exists where there are gaps of months
between the time one withholding order ends and another is put
in place.

I would suggest that this type of an approach would do an enor-
mous amount to strengthen the enforcement of child support. It
would ensure that children for the most part do get the support
that they are owed.

This approach eliminates cumbersome interstate enforcement
problems because a national entity with nationwide jurisdiction
would be collecting the support. There simply wouldn't be an inter-
state enforcement problem because all States would be in the same
system.

It would be easier for employers to interface with this system.
There would be one entity to whom they would have to be sending
their W-4 reports and from whom they would receive withholding
orders. This is preferable to 54 different entities that would exist
in a State-based system.

It would send a message to obligated parents that we take pay-
ment of child support seriously and we intend to see that it is done.
And finally it would relieve the burden of collection from the States
so that they could redirect some of their current staff to doing those
things in the paternity and support establishment area that pre-
vious witnesses have so eloquently requested help in doing.

I think if we did this, enacted a national child support guideline,
and moved to child support assurance, we could actually have an
enormous impact on child poverty in this country, and that is what
this really ought to be about.

Thank you.

[The prepared statement follows:]

178

TESTIMONY OF PAULA ROBERTS
CENTER FOR LAW AND SOCIAL POLICY

My name is Paula Roberts and I am the Senior Staff Attorney at the Center for
Law And Social Poliq' (CLASP). CLASP is a public interest law firm which focuses on
the plight of low-income families. For the last decade, a major part of our work has
been directed toward improving child support enforcement.

As the Subcommittee knows, all too many American children live in poverty and
near poverty because of the failure of our state-based system to establish paternity and
support orders and to enforce those orders which have been obtained. As Geraldine
Jensen of ACES explains in her testimony, it is possible to improve the state system in
regard to obtaining paternity and support orders. However, to improve the enforcement
of support, the child support collection and disbursement system must be federalized.
This statement in support of this position is submitted by CLASP and has been prepared
in conjunction with the Children's Defense Fund, the National Women^ Law Center,
and the Women's Legal Defense Fund, all of whom also favor federalizing the collection
and enforcement of child support obligations.

Background

The child support system includes locating the noncustodial parent, establishing
paternity, obtaining a support award, periodically modifying the award to reflect the
situation of the parties, and making sure the award is actually honored. Historically,
these functions have been governed entirely by state law. Including the states, territories,
and the District of Columbia, that means that within our country 54 different systems
operate.

Since 1974, Congress has made four serious attempts to streamline this state-
based system. In 1974, you added Title IV-D to the Social Security Act. Under this law,
every state must operate a child support enforcement program which provides free child
support enforcement services to recipients of Aid to Families With Dependent Children
(AFDC) and Medicaid. TTiese state agencies must also provide services to nonwelfare
families who generally pay nominal fees. The federal government underwrites the bulk
of the cost of miming these state systems.

The creation of IV-D agencies made child support services more accessible to
those of modest means. It did not, however, address the fact that the 54 different state
systems lack uniformity. In 1984, in 1986, and again in 1988, Congress tried to address
this problem. You required states to enact certain similar statutes. By-and-large these
statutes affected those using the IV-D system and non-IV-D families. The major changes
required states to: (1) allow paternity to be established at any time prior to a child's 18th
birthday; (2) except in unusual circumstances, set child support awards pursuant to a
state child support guideline; (3) process cases expeditiously through quasi-judicial or
administrative processes; (4) enforce support orders by withholding the ordered support
from the obligated parent's wages before arrears accrued ("immediate wage
withholding"); and (5) collect arrearages through withholding state income tax refunds,
the imposition of liens on real and personal property and garnishment. Congress also
established a Federal Parent Locate System (FPLS) to track down noncustodial parents
and authorized the Internal Revenue Service (IRS) to both intercept federal tax returns
to pay off child support arrears and use its resources to collect in particularly difficult
cases.

While Congress was attempting to bring some uniformity to the state-based
systems, two trends were also occurring. The first was demographic. The divorce rate
began to soar and now stands at 50 percent. The rate of birth outside marriage also rose
dramatically, and is now near 30 percent. Thus, the number of children needing efficient
and effective child support services has increased enormously. The second trend was
toward mobility. The reasons range from better employment opportunities, remarriage,
or the need to be closer to supportive family members but the reality is that parents who
once lived in the same household may find themselves in different states after they
separate. Indeed, nearly 30 percent of all child support cases now involve parents
residing in different states.

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Results of Congress' Past Reform Efforts

To date. Congress has identified and addressed two basic issues: lack of access to
child support enforcement services, and lack of uniformity in state laws. To address the
former problem. Congress has provided substantial federal funding to states to provide
free or low-cost services. While potentially extremely helpful to custodial parents, these
state systems have a dismal performance record. They actually collect child support in
only 20 percent of their cases according to the latest Annual Report to Congress. The
state IV-D system has also failed to become more cost-efficient. In 1991, $3.82 was
collected per dollar of administrative expense. This is a decrease from 1988 when $3.94
was collected for every dollar in administrative expense.

The creation of these state child support enforcement agencies has also brought
about a two-tiered family law system. One group of families uses private lawyers while
another uses the services of state IV-D agencies. This becomes problematic in the area
of enforcement. A family which uses the private system may receive support directly
from the noncustodial parent leaving no formal record of payment. When payments stop
and the family seeks the services of the state IV-D agency, there is no way to prove how
much support is in arrears. By then, the custodial parent may also no longer know
where the noncustodial parent lives or works. This makes the job of the state IV-D
agency very difficult. If the noncustodial parent has relocated to another state, the state
agency's job is nearly impossible.

Congress' efforts at streamlining state law have also had mixed results. For
example, there is a good deal of difference in how and when immediate income
withholding is being implemented. Some states have yet to enact immediate income
withholding laws in non-IV-D cases. Likewise, while every state has adopted child
support guidelines, there is great variation in the amount of support ordered for similarly
situated children. For example, two children whose mother earns $1,000 per month and
whose father earns $1,500 per month will receive $523 per month in support if they live
in Connecticut but only $431 if they live in neighboring Rhode Island. In Minnesota, the
amount would be $331.

Thus, despite recent efforts, the child support enforcement picture remains bleak.
The average award is less than $3,000 per year. And forty-two (42) percent of custodial
mothers do not have a child support award. Of those with an award, not even half
actually collect what is owed. As Chart 1 shows, these numbers are not much different
than they were in 1978.

Chart 1. Child Support Performance Over Time

% of Mothers With
An Order

1978
59

1981
59

1983
58

1985
61

1987
59

1989
58

% of Mothers
Obtaining Full Amount
Ordered

% of Mothers
Obtaining Partial
Payment

% of Mothers
Obtaining No
Payment

Source: Bureau of Census: Child Support and Alimony: 1989

180

Of particular concern is the picture in interstate cases: 57 percent of mothers
with interstate child support orders do not receive regular payments.

The Next Round Of Reform

Child support enforcement needs swift and dramatic improvement. On this there
is broad agreement. There is, however, deep disagreement about how to accomplish
needed change. Some believe that, despite its shortcomings, the existing state-based
system can be further streamlined and the IV-D system improved. The U.S. Commission
on Interstate Child Support ("the Commission") is the most vocal proponent of this
approach.

The Commission's recommendations rely heavily on a belief that many of the
problems inherent in the system can be addressed by the development of an integrated,
automated IV-D computer network linking all the states. In such a system, state IV-D
agencies would be able to help each other locate absent parents and their assets, and
more aggressively pursue interstate income withholding. Since federal legislation
requires all states to have automated statewide computer systems by October 1995, the
Commission envisions that it will be possible to build these systems into an integrated
national system. Unfortunately, a recent General Accounting Office Report suggests that
many of the state systems are seriously flawed and will not be functioning on time. Even
if they could be functioning by 1995, there is some question as to how quickly (if ever)
these 54 independently developed automated systems will be able to communicate with
one another. Moreover, this reform affects only IV-D cases.

Another cornerstone of the Commission's approach is to require all states to
adopt the newly promulgated Uniform Interstate Family Support Act (UIFSA). This
would bring some coherence to the processing of all (IV-D and non-IV-D) interstate
child support cases, but only if every state adopts it verbatim. Otherwise there will be 54
different versions of UIFSA, replicating the current problems with URESA.

The strength of the state-based approach is that it is consistent with past methods
of reform. It thus generates less political controversy among powerful interests such as
judges, lawyers and state legislators/officials. Its weakness is that it rests on the
questionable assumptions that 1) a flawed IV-D automation system can be saved and
then rebuilt to enable interstate communications; and 2) enactment of UIFSA will
radically improve interstate support enforcement. The computerization solution also
does nothing to address enforcement problems in non-IV-D cases and the issues which
arise in cases which move back and forth from non-IV-D to IV-D status.

This has led others to propose adoption of a national child support guideline and
a federalized system for collecting and disbursing child support. A national uniform
federalized collection, disbursement and enforcement effort, housed at an experienced
federal agency such as the Internal Revenue Service (IRS), would ensure that the highest
possible proportion of children receive child support payments from their noncustodial
parents. Under a federal system, all child support orders would be enrolled in a national
registry. The registry would contain an abstract of the order, the parents' current
addresses and Social Security numbers, and relevant employer information. In most
cases, enforcement would be through immediate wage withholding. When the obligor
changed jobs, he/she would fill out a form for the new employer stating whether or not
there was a child support obligation and the amount owed. The employer would send
this form to the IRS to match against the registry of orders. (Alternatively, employers
would be able to match the forms themselves against information in the registry through
electronic and telephonic on-line access to registry data.) If the registry confirmed the
information, withholding would proceed. If the employee failed to report the obligation
or understated it, the registry would inform the employer of the correct withholding.
The IRS would collect the payment, record it, and promptly disburse it to the custodial
parent or AFDC agency.

In the case of non-wage earners, the IRS could implement quarterly reporting and
payment for current support. If an obligated parent failed to pay, the IRS could access

181

information from the parent's previous tax return to find income, assets, bank accounts,
and the lii^e and begin enforcement.

The IRS could also be given new enforcement tools. Obligors should be required
to report child support obligations on their federal income tax form and pay with their
taxes - any outstanding child support obligations. Moreover, an individual who fails to
pay child support should be prosecuted to the same extent as an individual who fails to
pay income taxes.

Use of the IRS would highlight for noncustodial parents the seriousness with
which the government views child support obligations and bring the full weight of the
IRS enforcement authority to bear on the collection of support. Moreover, collection
would be more efficient, as a single federal agency would be involved and high-volume
payment-processing and enforcement technology could be used.

This approach should also make income withholding much easier for employers.
As immediate income withholding becomes the primary method of payment, employers
will come to see child support withholding to be the equivalent of tax withholding.
Withholding can be built into the payroll system. In interstate cases, if only IRS is doing
the collecting, employers will not have to be dealing with up to 54 different state
agencies each with its own procedures and regulations.

Federalizing the collection of child support greatly increases the likelihood that
most noncustodial parents will pay their support regularly and on time. This, in turn,
makes the cost of a Child Support Assurance system fairly small. Indeed, for an
investment of $2.1 billion, we could make a substantial dent in the poverty of America's
children.

Conclusion

Despite several attempts at change, the nation's child support enforcement system
remains inadequate. The result is that too many children face a future stunted by
poverty and near poverty.

Hard decisions have to be made. Do we continue to try reform in the state-based
model as the Interstate Commission suggests? Or do we recognize, after nearly 20 years,
that this approach has failed? Shouldn't we try a national child support guideline and
move enforcement into the IRS?

In making this decision, we might also look beneath the surface. Is it any the less
"federalization" if Congress requires state legislatures to adopt laws than if Congress
federalizes the function altogether? Perhaps the choice here isn't "to federalize or not to
federalize." Perhaps the real question is which type of federalization will yield the
greatest benefit to children.

182

Chairman Ford. Thank you very much.

Ms. Roberts, you have heard the testimony from other witnesses
here. You have been in the committee room all day. How would you
respond to earlier opposition to the federalization of the child sup-
port system?

Some have indicated that the Federal Government is having
problems at times trying to collect Federal taxes. How can you re-
spond to some of their earlier comments said here before this sub-
committee?

Ms. Roberts. I think it is always frightening to contemplate
change. Part of what we are seeing here is a reaction to change,
part of it is that there are vested interests out there. There are
people with jobs in the child support agencies, there are lawyers
whose jobs depend on the need for a fairly cumbersome system,
and they all see that a change could affect their livelihood.

We have nonpaying parents who resist paying who can certainly
see that a national system that can reach out swiftly and easily to
them, wherever they are, means they will have to pay. And so I
think that there are a lot of reasons why people's initial reaction
is what it is. My guess is that if we talk about this

Chairman Ford. What about the Massachusetts plan, automated
systems and State, local, and Federal data base?

Ms. Roberts. I think the question becomes this: Is it any dif-
ferent federalization if you order everyone to do what Massachu-
setts has done or if you create a federalized collection system?

It seems to me that it is still federalization if you order everyone
to be Massachusetts. Moreover if you order everyone to be Massa-
chusetts, what the history of the 1975, 1984, and 1988 amend-
ments tell us is that they will not comply with your directive. They
will drag their feet, they will take their time.

We still have States that haven't fulfilled their obligations under
previous laws, so you are taking the chance that once again you are
going to tell the States to do something and they are going to drag
their feet in doing it.

Chairman Ford. Thank you.

Ms. Ebb, let me ask you, do you have any estimates on how
much this nationwide system would cost if we are talking about a
child support assurance program? Do you have any idea as to what
the cost would be?

Ms. Ebb. There is a wide range of estimates that varies greatly
depending on the level of the benefit and the assumptions that you
make about the efficacy of child support enforcement.

Irv Garfinkel at the Institute for Poverty Research estimated
that it would be $2.1 billion for a system that had a $3,000 benefit
and that included assumptions of improved enforcement and higher
child support guidelines resulting in higher orders.

Chairman Ford. You said about $2.1 billion has been one esti-
mate, right?

Ms. Ebb. Right, although even Professor Garfinkel had a range
of estimates that varied greatly, depending on different assump-
tions about the program.

Chairman Ford. We would need to assure the taxpayers that we
are not going to implement a program that is going to be substan-
tially higher than anyone could estimate. That is not that I don't

183

support the plan, but I am just wondering how do we sort of nar-
row it to a cost factor here.

Ms. Ebb. That is right. That is one reason that we beheve so
strongly that it is essential to include improved enforcement as a
piece of the plan in order to contain those costs.

Chairman Ford. Thank you very much.

There are two bells on, and I am going to end the hearing. I
know you all have been here for a long time, but I want to thank
you.

As I have said to the other panelists who have appeared before
the subcommittee today, during the course of this year this sub-
committee will have contact with many of you and many more
throughout this country in helping us to draft and craft a bill that
will, in fact, address the real problems in the child support area.

Your testimony today has been very helpful to all oi the sub-
committee members, staff as well, as we go about the business of
trying to crafl some legislation that will address these many, many
needs. Again, thank you for waiting, thank you for your testimony,
and thanK you for coming.

The subcommittee is going to stand adjourned subject to the call
of the Chair at this time.

[Whereupon, at 2:27 p.m., the hearing was adjourned.]

[Submissions for the record follow:]

184

A Vision of Child Support Reform:
A Written Statement for the Record

June 24, 1993

Submitted to the Human Resources Subcommittee

House Ways and Means Committee

United States House of Representatives

Ayuda, Clinica Legal Latina

1736 Columbia Road NW

Washington, DC 20009

(202) 387-0434

Center for Law ANfD Social Policy

1616 P Street NW

Washington, DC 20036

(202) 328-5140

Children's Defense Fund

25 E Street NW

Washington, DC 20001

(202) 628-8787

National Women's Law Center

1616 P Street NW

Washington, DC 20036

(202) 328-5160

United States Catholic Conference

3211 4th Street NE

Washington, DC 20017

(202) 541-3190

Women's Legal Defense Fund

1875 Connecticut Avenue NW

Washington, DC 20009

(202) 986-2600

185

Introduction

As advocacy groups that care deeply about the plight ot" single-parent families plagued by the
epidemic of non-support, we have joined together to develop this vision for a child support system that
delivers on its promise to support children. Most of the groups submitting this joint statement have worked
closely together as an informal, but close-knit, task force on national child support policy for ten years.

We worked hard to help shape and build consensus for child support improvements made by the
federal Child Support Enforcement Amendments of 1984 and the child support provisions of the Family
Support Act of 1988. We followed this legislative work with intensive work on federal regulations
implementing the program. Many of us have worked as well on the state and local level, trying to ensure
that the theoretical promise of federal child support reform becomes a reality at the grassroots level.

We are heartened by the many improvements that have been made. At the same time, we are deeply
disturbed by the continuing failure of the child support system to deliver on its promise: that child support
should provide a regular, reliable source of support for children in single-parent households. It is time for
fundamental reform of the system.

Our statement provides a pragmatic blueprint for that reform. We believe strongly that child
support assurance, coupled with aggressive, improved enforcement of child support is essential. This
statement outlines how to achieve reform in key areas: improved enforcement; child support assurance;
outreach; paternity establishment; uniform national guidelines; expedited procedures to establish
paternity and child support obligations and to enforce support; medical support; and provision of
adequate resources, training, and auditing procedures to make the system work.

The group also has a joint position on how to design and implement a child support assurance
program. This approach is outlined in written testimony submitted by the Children's Defense Fund for this
hearing record. Rather than reiterate the same testimony, we state our support for the positions on child
support assurance taken in the Children's Defense Fund written submission and incorporate them by
reference.

Different members of our task force took responsibility for preparing sections of this statement.
Sections on paternity establishment and medical support were drafted by Paula Roberts of the Center for Law
and Social Policy, who also worked with Nancy Duff Campbell of the National Women's Law Center to
prepare the section on expedited procedures. Nancy Duff Campbell and Sarah Craven of the National
Women's Law Center drafted the enforcement section. Diane Dodson of the Women's Legal Defense Fund
drafted sections on outreach and national child support guidelines, and Nancy Ebb of the Children's Defense
Fund drafted the section on resources as well as testimony on child support assurance incorporated by
reference into this document.

Enforcement

Prior to 1974, establishment and enforcement of child support obligations were purely a matter of
state law. Since that time, however, the nation's child support enforcement system has been undergoing a
process of federalization. To date, this process has been accomplished by the provision of substantial federal
fijnding to the states to provide child support services, by the enactment of federal laws which require the
54 states and territories to enact state legislation (e.g., immediate income withholding) and by limited use
of federal locate and enforcement mechanisms.

This method of federalization has not achieved the desired results: according to census data, 40
percent of custodial mothers still do not have a child support award and, of those with an award, only half
actually collect what is owed. These numbers are the same as they were in 1978. The picture for those
using the state IV-D system is even more bleak: according to OCSE data, the average state paternity
establishment rate is 45 percent and a collection of support is made in only 19.3 percent of IV-D cases. Of
particular concern are interstate cases, where 57 percent of custodial mothers with orders do not receive
regular support. Since 30 percent of all cases are now interstate, this is a very serious problem.

The current state system has also failed to become more cost-efficient. In 1991, $3.82 was collected
per dollar of administrative expense. This is a decrease from 1988 when $3.94 was collected for every
dollar in administrative expense.

186

In shon, the federal government is losing over half a billion dollars yearly on a program which is
failing to provide even minimally adequate services. The resulting direct and indirect costs to children are
beyond measure.

The dismal record of the states has many causes. Chief among them are insufficient staff and
resources at the state and local levels; a multiplicity of actors (e.g., judges, court clerks, district attorneys,
process servers, sheriffs) who are outside the control of the IV-D agency but who must act efficiently if the
agency is to do its job; diverse, and frequently inconsistent state laws which make processing interstate cases
particularly difficult; and a lack of automation. While the Family Support Act requires states to automate
their systems, 42 U.S.C. § 654 (24), a recent GAO report reveals that many states will not meet the 1995
deadline as required by the law. More importantly, even if all 54 states become automated, they will not
necessarily be able to interface with the automated systems in other jurisdictions.

We, therefore, believe that the enforcement of child support obligations should be moved to the
federal level. This would accomplish several things: I) free up state staff to perform other functions (i.e.,
locate, paternity establishment/modification), easing the current caseload problems; 2) provide a uniform
national collection system which could reach obligated parents wherever they live or work; 3) greatly ease
the burden on employers involved in income withholding, who would only have to deal with one entity with
one set of policies and procedures, not several different entities depending on where the custodial parent
resides.

The Need for Federalization

A federalized collection, disbursement and enforcement effort, housed at an experienced federal
agency such as the Internal Revenue Service (IRS), would ensure that the highest possible proportion of
children receive child support payments from their noncustodial parents. As discussed below, this system
would work best when implemented with child support assurance, a national child support guideline, and
income reporting on W-4 forms.

Under a federal system, all child support orders would be sent to a national registry at the same time
as the initial notice of withholding is sent to the obligor's current employer. The registry would abstract
the order and maintain the abstract with the parents' current addresses and social security numbers, as well
as relevant employer information. In most cases, enforcement would be through wage withholding. When
the obligor changed jobs, he/she would be required to fill out a W-4 form stating whether or not there was
a child support obligation and the amount owed. The employer would immediately begin withholding the
reported amount owed and without delay send the form to the IRS to match for accuracy against the
abstracted order. (Alternatively, employers would be able to match the forms themselves against information
in the registry through electronic and telephonic on-line access to registry data.) If the employee reported
the obligation incorrectly, the IRS would inform the employer of the correct withholding amount. Payments
withheld would be sent to IRS for recording and prompt disbursement to the custodial parent or AFDC
agency.

We believe that the IRS has both the tools and the experience to collect and enforce child support
obligations. Use of the IRS would highlight for noncustodial parents the seriousness with which the
government views child support obligations and bring the full weight of the IRS enforcement authority to
bear on the collection of support.

The IRS could also use its extensive information system to assist in locating absent parents and their
assets, both to help states establish and modify orders and for its own enforcement purposes. For example,
IRS data could be used to supplement data from other federal and state records -- including tax, deed, motor
vehicle, public utilities, criminal, correctional, occupational/professional/ recreational licensing, and vital
statistics records.

Finally, to improve collections the federal government must be given new enforcement tools. For
example, obligors should be required to report on their federal income tax form and pay with their taxes
(including quarterly estimated taxes, for the self-employed) any outstanding child support obligations.
Accordingly, an individual who fails to pay child support would be prosecuted to the same extent as an
individual who fails to pay income taxes. In addition, the federal agency should be required to 1) report to
consumer credit agencies the existence of a child support obligation (not just the existence of a delinquency);
2) automatically issue a lien when an asset is located and there is an arrearage (as now done in
Massachusetts); 3) intercept lottery winnings and other awards/prizes; and 4) collect child support arrears
after the child reaches the age of majority or the age at which support is otherwise scheduled to cease under
the order.

187

Reform at tiie State Level

Our strong preference is for a completely federalized system. If complete federalization of the
child support enforcement system is not feasible in the short term, immediate improvements in the
federal-state system must nevertheless be made. As described below, necessary improvements in the state
system would include the creation of both a central federal and state registry; improved employer
withholding; greater integration with the federal income tax system of collection and enforcement; and
enhanced state locate and enforcement tools. The interim remedial measures suggested here are effective
steps towards achieving a fully federalized system and will improve state collection, disbursement and
enforcement efforts as well.

• A central federal registry of all child support orders. In order to streamline and improve state
enforcement efforts, a central federal registry should be established. As discussed above, the federal
registry would contain a basic abstract of all child support orders issued or modified by a state
including the names, social security numbers and addresses of the parties which could be matched
against employer records. The federal registry would receive W-4 repons from employers, match
the reports against the registry's abstracts and confirm that support is owed, to whom it is owed, and
in what amount. This information would then be forwarded to the appropriate state registry which
would collect and disburse child support payments. A federal registry would significantly enhance
the state registry's ability to collect and enforce interstate orders in particular as it would allow
individual states to access a universal data base that could quickly identify obligors' current
employers as well as red flag the existence of orders issued in other states and/or multiple orders.
In addition, access to a federal registry could assist states in locating absent parents in intra-siate
cases.

• A central state registry of all child support orders. Each state would be required to maintain a
central registry of all child support orders issued in the state. As described above, the state registry
would receive employment information from the federal registry and then utilize an automated system
to receive, record and disburse payments collected through wage withholding for all orders recorded
in the state registry. The state registry would monitor the receipt of payments and would commence
appropriate enforcement actions when payments were not received on time or notify an appropriate
agency to do so. A single state entity for collection and disbursement would streamline the
enforcement process and increase the likelihood that child support payments would be made promptly
to custodial parents.

• An improved system of employer withholding. To enhance and coordinate wage withholding,
employees would be required to report child support obligations on W-4 forms that would be
promptly forwarded to the federal registry. Unless and until corrected by the federal registry, the
W-4 information would be used as the basis for the employer's withholding and the state registry's
collection and enforcement efforts. Interfacing between the state and federal registry would boost
state collection efforts as the federal database would include both child support orders and
employment records from all the states.

• Integration of collection and enforcement with the federal income tax system. Even without
enforcement and collection by the IRS, child support collection should be integrated to a greater
degree with federal income tax collection. For example, child support arrears should be treated as
a tax liability subject to collection by the IRS with obligors required to report on their federal income
tax form and pay with their taxes any outstanding child support payments. As discussed previously,
such integrated efforts would improve enforcement as well as send a national message to noncustodial
parents about the serious nature of child support obligations.

• Enhanced locate and enforcement tools. States should be given the enhanced locate and
enforcement tools described above to expand access to state records. Thus, states should increase
the use of automatic liens, credit bureau reporting, interception of awards/prizes, and collection of
arrears beyond the child's age of majority. In addition, they should expand data bases and be
allowed to deny professional and recreational licenses to noncustodial parents with outstanding child
support obligations.

Outreach and Accessibility

A child support award is a precondition for the receipt of child support for most children of single
parents. Many of the child support assurance schemes proposed to date would provide assured benefits only
on behalf of children with awards. Yet, two out of five single mothers in the U.S. lack child support awards

188

for their children. And, three out of five single mothers with household incomes below the poverty level
lack such awards. Low income minority and never married single mothers are most likely to lack awards.'

Many of these parents lack child support awards because they have never sought help from the child
support system— often because they are unaware of how to do so or the benefits of doing so. Many others
reach the child support system, but the system fails them by failing to obtain a support award for their
children.

It is clear that the child support system must improve its outreach and accessibility if the first
problem is to be overcome. In order to do so, federal law should require the following:

• That a uniform federal application form be used by all states-written in a language and format
useable by low literacy individuals. This federal application form should be translated into
commonly used languages and made available to state and local agencies.

• That each child support agency identify groups which are underserved by its programs and
consult with representatives of those groups to identify barriers to their successful utilization
of child support services. Outreach efforts should be targeted to these groups and detailed in a plan
to be submitted by the state to the Department of Health and Human Services for approval.

• That local child support programs reach agreements with local food stamp, head start, and
maternal and child health programs to ensure that information about child support services is
made available to clients of these other programs.

• That all state child support agencies establish a 24 hour a day, 7 day a week 800 number to
provide general information and to provide information on individuals' cases. For example, the
District of Columbia currently provides information by telephone on the payment status of child
support cases to parties when they key in their personal identification numbers.

• That all child support agencies establish weekend and evening hours.

• That each child support agency make its services available throughout the geographical area
it serves either by providing transportation for clients when no public transportation is available
or by providing services in locations near clients' homes— for example by mobile intake units,
co-location of offices with other agencies, or by a system of telephone intake.

• That each local agency make its services accessible in each language used by a significant
population group in its community and assure that services are accessible to persons with
disabilities. In addition to providing the federal application form in the languages commonly used
in its community, interpreters should be available to translate in all languages commonly used in the
community-including American sign language.

• That each state coordinate IV-A and IV-D intake to ensure that each AFDC applicant will
receive accurate and understandable information on the child support program, client
responsibilities in it, how to pursue a child support case and his or her right to claim a good
cause exception. This information must be provided by the lime information is gathered for
pursuing a child support case. AFDC workers must be trained to provide information on the child
support program or IV-D staff must be outstationed at IV-A intake locations to provide this
information.

PATERNITY ESTABLISHMENT

Last year, almost 30 percent of the babies born in America were born to unmarried parents. Unless
paternity is legally established, these children will never have the right to receive child support or to inherit
from their fathers. They will also be ineligible for Social Security Survivors' benefits, veterans benefits and
the like. They are likely to grow up in poverty, further increasing our unconscionably high rate of childhood
poverty.

' Census Bureau data is available only on percentages of single mothers with child support awards.
However, the data the Census Bureau is currently gathering on this subject will cover single fathers as
well.

189

Unfortunately, most states still have antiquated paternity establishment procedures. President
Clinton's FY 1994 budget contains several solid proposals for moving to a more streamlined system.

These include proposals to require states to adopt 1) a simple affidavit process for establishing paternity
voluntarily at the hospital or birthing facility where the baby is born; 2) simple procedures for establishing
paternity voluntarily at the state birth records office for those who did not have the hospital procedures
available (e.g., those with older children) and those who did not use the in-hospiial process: and 3) state laws
setting up a rebuttable presumption of paternity in contested cases when genetic test results yield a high
probability of paternity. We also applaud the use of enhanced paternity performance standards for the state
IV-D agencies.

In conjunction with these reforms, we suggest two other steps be taken. First, federal nnancial
participation should be made available to offset the cost of voluntary paternity establishment in all
cases, not Just those handled by the IV-D agency. While this would entail some federal cost in the short
run, we believe it would be sound policy and would save money in the long run because:

• many unmarried mothers, and especially first-time mothers, are not IV-D clients at the time of their
baby's birth. Yet, the chances are very good that they will eventually be in the IV-D system. For
example, in Washington's in-hospital paternity program only one-quarter of the mothers were IV-D
clients at the time of the birth: a year later, nearly half were.

• research by Esther Wattenberg and others suggests that fathers frequently come to the hospital at the
time of the baby's birth. Two years later, the parents are likely to have lost contact with one
another. Then, expensive services like parent locate, genetic tests and jury trials may be necessary
to establish paternity. If the mother is then a IV-D client, the state may have to absorb several
hundred dollars in costs to obtain a paternity finding.

Our second recommendation is that states be required to have quasi-judicial or administrative
processes available for establishing paternity in contested cases. Federal law now makes this optional,
42 U.S.C. §666(a)(3)(B). We believe it should be mandatory as clients in many states report lengthy delays
in getting courts to calendar and hear contested paternity cases. For example, a four-state study found that
mothers needing paternity established frequently waited more than one year for the order to be issued.

After requiring the states to enact expedited processes for paternity cases, the current federal
regulations, 45 C.F.R. §303. 101(b)(2), should be expanded and the case processing standards contained
therein should apply to paternity actions.

National Child Support Gutoelines

When Congress adopted the initial state guidelines requirements of the Child Support Enforcement
Amendments of 1984, concern was expressed by members over the lack of uniformity in the treatment of
similarly situated obligors and over low award levels which resulted in unfairly reduced living standards and
often poverty for children. While no minimum standards were set for state guidelines, it was hoped these
problems would be addressed by the states in devising their support guidelines.

It is now clear that the state-by-state guideline approach has resulted in orders that are still often too
low to meet the needs of children and which vary significantly from state to state, even though they should
lead to some increase in award levels. The state guidelines requirements of the CSEA and the Family
Support Act have led to a useful period of experimentation among the states. This has increased our
understanding of alternative approaches to child support guidelines. Now is the time to correct the inequities
that result from state efforts to date.

A national child support guideline which requires significantly higher award payments than the
average state guideline requires today is an essential component of a system in which child support
assurance benefits are provided by the federal government and in which the federal government
undertakes to collect child support awards. A child support assurance system will be prohibitively
expensive unless children's absent parents are asked to pay a fair share of the cost of maintaining them in
decency. If a uniform national guideline is not followed, the federal government would subsidize the
obligations of absent parents in some states to a greater degree than those in other states because of
nonuniform state guidelines. Similarly, the IRS would be involved in enforcing different award levels
against similarly situated noncustodial parents in the absence of a national guideline.

However, a national guideline or new federal minimum standard for state child support
guidelines should be adopted even if we do not move directly to a national child support assurance

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scheme and federal collection of child support. This should lead to a reduction in child poverty and a
savings on public benefits even under the current system.

We have reached considerable agreement, but not consensus on the precise contents of a national
guideline. We all believe that a national guideline generally should achieve higher award levels than is
typical under the current state guidelines. Legislation should require the establishment of a national child
support guideline commission to develop a national child support guideline.

That group should include economists, lawyers or judges, and representatives of public child support
agencies. It should also include representatives of organizations which represent the interests of both
custodial and noncustodial parents, organizations which represent the interests of children, and academic,
governmental and other researchers on the costs of raising children and comparative living standards in
households of different sizes and compositions.

A number of us support a guideline based on the principles described below:

• Award levels under the guideline should ensure that children will enjoy a minimum decent
living standard (at least 1.5 times the federal poverty level) if it is possible to provide this
without placing the noncustodial parent at a lower living standard; when there is insufficient
family income to reach this goal, at least a poverty level living standard should be provided to
children when this is possible without impoverishing the noncustodial parent. Nominal support
should be required in any event to establish the principle of the obligation, create a habit of payment
and provide a basis for increased collections as income increases.

• Once above a minimum decent living standard, award levels under the guideline should ensure
that children will enjoy a living standard which is comparable to that of the higher income
parent. (This might, for example, be based on assuring that both households were in the same
quintile of family income, rather than on assuring precise equality.)

• Award levels should represent a "progressive tax" structure for payment of child support: both
parents' incomes should be considered and the parent with the higher income should be asked
to pay a higher percentage of her or his income toward supporting the child than the lower
income parent. This principle should cover both a basic child support award and coverage of child
care costs, health costs, and special needs of the child(ren). This will result in award levels which
are sensitive to the needs of children in low income custodial parent households by requiring
significantly higher payments from the noncustodial parent when the custodial parent has lower
income and permitting lower payments when the custodial parent's income is higher.

• So long as the costs of health care and child care are borne primarily by individual families and
so long as their actual cost to different families continues to vary dramatically, child support
awards should take into account the actual cost of these items in each family. The same
principle should apply to the costs of meeting children's special needs.

• No paying parent should be asked to pay child support at a level which would put her or his
living standard below the living standard provided by AFDC and other public benents to the
custodial household. However, a parent with income below this level may be required to pay a
nominal level of support or may participate in an appropriate and agreed upon employment and
training program.

• The presence of additional children of either parent should result in further examination of the
support award level. Guidelines should ensure that the children in the two households are treated
in a comparable way.

Two members favor the percentage-of-income approach, believing that its simplicity is a virtue.

Since it requires a court or administrative agency to obtain information from only one parent (to enter a basic
support award), it should ease the process for establishing and periodically modifying awards. Indeed, if
awards were set as a percentage of income, rather than a dollar amount, extensive modification proceedings
would be unnecessary.

However, they believe that the percentages now in use in the states which use the percentage-of-
income approach are too low and should be increased in a national system. Also, the basic guideline amount
should be supplemented to pay for child care costs and medical expenses for families which face these costs.
This would require information from both parents.

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Expedited Processes

In child support cases, speed is of the essence. The longer it lakes to obtain or enforce an order,
the greater the chance that children will go hungry or lack medical care. Despite a requirement in the law
since 1984 that states use "expedited processes" in obtaining and enforcing child support orders, 42 U.S.C.
§666(a)(3)(A), cases still are not being processed in a timely way once a case is prepared for filing. Few
states are in compliance with the federal standards for processing cases.

Federal law requires states to use expedited processes within the state judicial system or under
administrative processes for obtaining and enforcing child support orders. 14. The federal regulations, in
turn, require that under expedited processes 90 percent of actions to establish or enforce support obligations
must be completed within three months of service of process, 98 percent must be completed within six
months and all must be completed within a year. 45 C.F.R. §303. 101(b)(2).

Unfortunately, many states are not in compliance with these standards. Nor has HHS collected data
to ascertain the source of problems states are having in meeting the standards. Accordingly, our ability to
suggest remedies for the states' widespread failure to meet the standards has been hampered.

Some of us believe that the problem lies in the failure of states to adopt administrative processes for
obtaining and enforcing support orders. The advantage of a wholly administrative process is that it places
within the executive branch the ability to keep the process moving expeditiously. It does not make
processing dependent on placement on a court calendar or the ability to hire more judges or court clerks to
process cases. For these reasons, many states that use administrative processes report that they are faster,
less costly and less formal. Indeed, in a recent survey nine states cited administrative processes as the best
feature of their state's system. Equally telling perhaps, 10 percent of the states surveyed identified a backlog
of court cases and/or lack of an administrative process as the most serious flaw in their state's system.

Others of us are not convinced that the simple adoption of administrative processes will resolve
states' inability to meet the case processing standards. Because some states with expedited judicial processes
move cases quickly and some states with administrative processes move cases slowly, it appears that either
system can be made to work. In our view the way to improve the speed with which the states process cases
is to strictly enforce compliance with the processing standards.

Those of us who believe the failure to adopt an administrative process is the basis for the states'
problems recommend that states that do not currently meet the case processing standards be required
to enact and implement administrative processes for obtaining and enforcing child support orders.

Those of us who believe the failure to enforce the processing standards is the basis for the
states' problems recommend that states that do not currently meet the standards be strictly audited
on their compliance with the expedited processes regulations. If they are not in compliance, they should
be required to develop a corrective action plan which could include, if appropriate, a required shift to an
administrative process. As part of the audit review, HHS should be required to examine the states' use of
expedited processes to determine whether differences exist in speed of processing between states with
administrative processes and states with expedited judicial processes, and whether those differences are
attributable to the processes used.

Although we have posed different approaches to solving the problems of case processing, we are
united in our belief that states must be required to process cases more quickly. Under either approach,
that goal must be reached.

Medical Support Enforcement

According to the GAO, 13 percent of those who lack health insurance are children. This number
would be much higher were it not for Medicaid. Yet, Medicaid represents the expenditure of tax dollars
on a population, some of whom could be covered by private health insurance. The President's budget
estimates that $15 million in Medicaid costs could be saved in FY 1994 through better medical support
enforcement. Thus, greater attention to establishing and enforcing medical support obligations could both
help children and reduce Medicaid costs.

To date, this has not been done. According to the Census Bureau, only 39 percent of existing
support awards provide for health insurance coverage: the number is even lower (32%) for families whose
income is below poverty. Within the IV-D system, there have been efforts in the last two years to give

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medical support greater attention. This emphasis should continue. However, the current incentive
payment system does not reward state efforts in this regard and this leads many states to ignore
medical support. The current audit criteria also do not emphasize the need to enhance efforts in this
area. Both audit reform and a different incentive system are needed.

However, making sure medical support orders are obtained is only half the battle. Orders also need
to be enforced. As the President recognized in his budget, employer's insurance plans which cover children
must offer the coverage even if the children are not living in the noncustodial parent's household. Such
plans must also allow open enrollment at any time for health insurance coverage required by a court or
administrative order.

There are three additional issues which need to be addressed: 1) requiring the employer to enroll
the children or former spouse in the company's health insurance plan when the court or administrative
agency orders this and the obligor does not quickly or voluntarily do so; 2) granting the obligee access to
information about the plan coverage and claim forms; and 3) honoring the obligee's signature on the claim
forms so that (s)he can be directly reimbursed. Five states have enacted legislation to deal with all three
issues in recent years. Eight others have addressed some but not all the issues. A federal mandate that all
states adopt legislation covering all three problem would be highly desirable.

Unfortunately, such state laws do not reach employers covered by ERISA. Thus, it is also very
important to amend ERISA for the limited purpose of making insurance plans offered by employers
who are self-insured subject to the state laws recommended above.

Each of these recommendations is supported by the GAO in its June 1992 report, MEDICAID:
Ensuring That Noncustodial Parents Provide Health Insurance Saves Costs.

Also in the medical support area, a number of issues may arise as health care reform is implemented.
We look forward to addressing these issues as they arise.

Resources

Resources in a Federalized System

As we discuss in the section on enforcement of support, federalizing collection and enforcement of
support is vital to the long-term success of the child support system. Under our proposed scheme, a federal
agency would perform most enforcement functions, while state systems would continue to establish paternity
and child support obligations. This scheme uses the federal government to do what it does best — to deal
with enforcement issues that frequently cross state lines - and focuses state agencies on cases that may
require more intensive work and more personal contact at the time a support order is initially established
or paternity determined. This proposal frees up resources in overburdened state agencies and allows them
to concentrate on what they have the potential to do best.

This structure has the greatest promise for making the child support system work. Even such a
structure will not work, however, unless adequate resources are allocated at both the federal and state levels.
Without these resources, the efficiencies gained by a national approach to enforcement will not be enough
to dramatically improve performance. To ensure that the federal component of the program has
sufficient resources, the Secretary of the federal agency responsible for enforcement should be required
to establish timelines for provision of federal services, report to the Executive and Congress on federal
stafTmg levels necessary to comply with these timelines, and request a budget that assures that such
levels will be achieved.

Additionally, it will be important to ensure that state agencies have the resources to establish
paternity and child support obligations in a timely fashion. As outlined in the discussion below, states
should be subject to staffing and training requirements, and should be held accountable for meeting
regulatory timelines for prompt establishment of paternity and child support obligations. Similarly, funding
formulas should be revised along the lines discussed below, to provide states with an adequate funding base
and to reward states that provide timely services and meet performance-based outcome measures.

Resources in a State-Based System

Even if the present system of delivering services is retained, enhanced resources are essential.
Providing the resources to enable states to do a better job requires improvements in four areas:
ensuring there is adequate staff to do the job, training staff to provide high-quality and effective

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services, ensuring sufilcient program funding, and revising the audit process.

• StafTing Problems. High state agency caseloads reflect the fact that HHS has never issued staffing
guidelines despite a longstanding statutory requirement that the Secretary establish minimum staffing
standards for states (42 U.S.C. Sec. 652(a)(1)). Many state child support enforcement agencies have such
high worker caseloads that workers cannot provide timely, effective services, no matter how dedicated and
well-intentioned they may be. While increased automation should enable workers to handle larger caseloads
more efficiently, in many states caseloads are so high that automation alone cannot possibly provide a
solution. For example, in 1990, the federal Office of Child Support Enforcement conducted an informal
review of sample child support cases and found that one West Virginia office had three paralegals to work
3,500 cases. One study found that the average FTE child support worker has over 1 ,000 cases. Center for
Human Services. U.S. Department of Health and Human Services, A Study to Determine Methods, Cost
Factors, Policy Options and Incentives Essential to Improving Interstate Child Support Collections: Final
Report, 36 (1985).

• Staffing Recommendations. The Secretary should, after consultation with state
administrators, program operations experts, and affected groups, promulgate a federal methodology
and outcome expectations for determining state stafTmg requirements. Final regulations should take
effect no later than September 30, 1994. Because staffing levels are likely to vary depending on a state's
system and its level of automation, establishing a federal methodology seems preferable to a single federal
staffing standard. Using this methodology, each state should be required to evaluate its child support system
and to report to the Secretary on its existing staffing levels and the level of staffing required to meet federal
staffing expectations. This report should include a plan for steps the state will take to ensure that staffing
expectations are met by September 30, 1996 (one year after the date states are expected to be automated).

Federal audits after September 30, 1996 should measure compliance with these staffing standards.
Slates that fail audits for periods before and after September 30, 1996 should be required to meet staffing
standards as part of their corrective action plan.

• Training Problems. The poor service that results from high caseloads is exacerbated by the lack
of effective training programs for workers. For example, a 1990 informal OCSE review of Oklahoma found
that staff providing child support services in one site are "usually hired with very limited credentials
including no formal education or training, and the [child support] training program is not adequate to equip
these workers with the skills necessary to do their jobs." Administrators across the country have reported
similar training concerns in other contexts.

• Training Recommendations. The Secretary should establish national expectations for training
of child support workers. Compliance with training requirements should be measured as part of the audit
process. The Secretary already has authority to establish such a standard as part of the statutory directive
that the Secretary establish minimum organizational and staffing requirements. Section 452(a)(2) of the
Social Security Act.

• Funding Problems. High caseloads also reflect the fact that states have not been willing to invest
sufficient state funds to draw down the federal matching funds necessary to hire adequate staff. Although
the combination of federal administrative matching funds and incentive payments results in a relatively rich
federal reimbursement package, advocates and administrators report that the funding scheme is complex and
difficult to explain to state legislators in order to convince them of the favorable returns for increased state
investments. Moreover, incentive payments, which total over a quarter of a billion dollars nationally, are
earned by state child support efforts but are not necessarily reinvested in child support. Rather, in a number
of states, incentives are used either for other human services or are renamed to the general treasury.

• Funding Recommendations. The current federal administrative match (66 percent FFP) and
incentive payment system should be replaced with a consolidated administrative match rate of 82.5
percent. This rate, which roughly approximates the current value of matching funds and incentive
payments, will ensure that federal funds are invested in child support services rather than in other programs,
enabling states to expand resources for enforcement. It will encourage states to invest more in enforcement
because it will be easier for administrators to make the case that limited state investments leverage significant
program resources.

If a slate fails a program audit and fails to submit or to comply with an approved corrective action
plan designed to eliminate audit failures, this consolidated administrative matching rate should be reduced
by 1 - 5 percent, depending on the severity of the non-compliance. This penally would replace the reduction
of federal AFDC matching funds as a penalty for IV-D non-compliance. A penalty against IV-D matching
funds more directly holds the IV-D agency responsible for its failures and does not have the effect of

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penalizing AFDC children for systems failures beyond their control.

To encourage states to improve performance, the match should be increased to 90 percent for states
that demonstrate through the audit process that they have:

(a) achieved a paternity establishment rate of 75 percent (using the formula outlined in Section 452(g)
of the Social Security Act);

(b) met state performance standards published by the Secretary pursuant to Section 452(li) and (i) in 75
percent of cases;

(c) collected child support, or taken another step to enforce support (including but not limited to
imposition of a lien; a successfully prosecuted action for contempt; certification of a case for IRS
full collection services; referral of the case for income tax refund intercepts) in 75 percent of cases
with an established child support obligation;

(d) established and, when necessary, enforced medical support in 75 percent of cases where medical
coverage is available to the absent parent at reasonable cost; and

(e) complied with steps outlined in an approved plan to reach required staffing levels (see staffing
recommendation above).

To ensure that the altered federal match does not result in a reduction of investment in child
support, or a shift of state and local resources from other programs that have benefitted from incentive
income, there must be a maintenance of effort requirement. This maintenance of effort should apply to
both state and local funding, and should apply to both child support funding and to Aid to Families with
Dependent Children. In some states, child support incentives have been used to fund human resources
programs such as AFDC; changing the child support matching formula should not have the effect of
penalizing AFDC recipients by reducing funding available for AFDC once states no longer have incentives
to allocate to AFDC funding.

• Audit Problems. The current auditing scheme, which consumes huge proportions of the federal
agency's personnel time, is burdensome on states. Despite the cumbersome nature of the process, it
produces information that is so dated that it is of little use in measuring or improving current state
performance. The audit process should be streamlined so that it reduces the burden on states that are doing
a good job, produces timely analysis of troubled systems, and frees up staff to do technical assistance that
will help states improve.

• Audit Recommendations. The current audit schedule should be revised to eliminate burdens
on states that are satisfactorily complying. This will enable the federal agency to emphasize timely audit
results and to focus attention on troubled programs:

• If a state passes a federal audit, it should be put on a three-year audit cycle.

• If state compliance with audit criteria is marginal (based on criteria established by the Secretary),
the state should be audited every two years.

• If a state fails a federal audit, it should be required to submit a corrective action plan for federal
approval. It should be audited twelve months from the date of approval of the corrective action plan,
and annually thereafter for a period of three years. Until an audit shows that the state has achieved
substantial compliance, the federal IV-D match rate should be reduced (see above). At the end of
the three-year audit cycle, if the state has not complied with its corrective action plans and shows
continuing, substantial non-compliance with audit criteria, then the program should be placed in
federal receivership.

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STATEMENT OF LINDA R. WOLF JONES, D.S.W., DIRECTOR OF INCOME
SECURITY POLICY, COMMUNITY SERVICE SOCIETY OF NEW YORK

The Community Service Society of New York (CSS) has been actively
working to improve the conditions of the poor for almost 150 years.
As part of its mission, it identifies problems that contribute to
poverty and the changes needed to eliminate such problems. One of
the ways in which we carry out the mission is through social
welfare policy analysis and advocacy at all levels of government.
In that context, we have reviewed a number of recent proposals for
child support policy change, including the Child Support
Enforcement and Assurance Proposal released last year by two
members of the 102d Congress, Representative Thomas Downey (D-NY)
and Representative Henry Hyde (R-IL) . The following comments focus
on that proposal and its implications for people in poverty.

The failure of existing child support mechanisms to provide
adequate income for poor women and children is a major problem
contributing to poverty in the United States today. For that
reason, we agree with the premise of the Child Support Enforcement
and Assurance Proposal that an overhauled child support enforcement
system coupled with a back-up program to assure a minimum annual
income would have a dramatic effect on reducing poverty among low
income single parent households with minor children. We would note
that we strongly believe that an assured minimum annual income
package should be at least adequate to provide families with a
decent standard of living. We also have a number of questions - of
both a philosophical and technical nature - about the Child Support
Enforcement and Assurance Proposal that was released last year.

The comments below are organized section-by-section to follow the
format of the above-referenced proposal. We appreciate the
opportunity to express our opinion, since we believe that many of
the same provisions will resurface for inclusion in future
proposals. We hope that the concerns which we raise will be taken
into consideration when future bills to change our child support
enforcement system are being drafted and debated in the Ways and
Means Committee.

SECTION-BY-SECTION COMMENTS

Administrative Structure

• We are not entirely convinced that it makes sense to set up
another massive, new federal program, from the point of view of l)
the bureaucracy that it will require, 2) the data collection/
sharing that it will entail, and 3) the involvement of the federal
government in what had been individual and state matters. However,
we recognize that the proposal is premised on the establishment of
such a program. We urge that the needs of custodial parents and
children, and the effects of proposed program policies and

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procedures on them, be of primary concern in developing the details
of any new legislation. It is easy to get so caught up in program
design ideals and models that the human beings at the end of the
line are lost. The potential for impersonalization and error
inherent in a large bureaucracy must be continually guarded against
when dealing with vulnerable populations; client concerns must take
precedence over philosophical beliefs or the convenience of the
design.

• It is unclear how, exactly, the new federal office would
function. The interaction between the IRS and the SSA needs to be
more clearly spelled out, with an indication of where the ultimate
authority would be housed. Since the reputations of the IRS and
the SSA for dealing with the public (e.g., courtesy, accuracy of
information given out) are very different, it is important to
delineate which system would be responsible for each function
assumed by the federal government. The collection of employer-
withheld funds; child support payments by the self-employed;
recordkeeping of amounts owed, collected and disbursed (including
child support payments, child assurance payments, and advance EITC
payments) ; data collection, retrieval and confidentiality; answers
to client guestions; dealing with client problems; liaison with
relevant state agencies; and numerous other functions could take on
a very different face in the hands of one agency as compared to the
other .

• The proposal indicates that the SSA would be responsible for
reviewing and modifying support awards, but it is unclear whether
it would also be responsible for the 2 or 3 year review that would
be based on the parents' tax returns. We could not tell from the
proposal whether the multi-year review is envisioned as an IRS
function or whether the IRS would simply turn all of the returns
over to the SSA. (If the former, is such income tracking and
comparing an appropriate IRS function? If the latter, are bad
precedents being set by the increased data sharing between
government agencies?) In either case, we would urge that if a
computerized, purely mathematical formula is utilized, it must
leave room for individualized consideration of changes in income,
family structure, needs, and other support-related issues.

• The proposal states that SSA would be responsible for
distributing payments to custodial parents, but it has also been
suggested that a single agency (presumably, the IRS) would be
responsible for the collection and distribution of payments. We
would oppose turning the distribution function over to the IRS.

Paternity Establishment

• The proposal would set up federal requirements and
guidelines for state paternity establishment programs, but it does
not offer any incentive for states to want to carry out the

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function of establishing paternity. On the contrary, a state would
save money by letting the SSA be responsible for it. Since we
believe that paternity establishment is more appropriately and more
effectively handled at the state level, we are concerned that a new
system look for ways to continue to have states carry out the
paternity establishment function rather than provide reasons for
them to walk away from it.

• Although the proposal appears to support voluntary
acknowledgment of paternity, it is ultimately coercive. A male who
doesn't "volunteer" can be required to take a genetic test. Unless
specifically excluded by the test results as a potential father, a
presumption of paternity would be made which he would have to rebut
in order not to be responsible for support of the child. (Although
there is a slightly different procedure depending upon whether the
probability of paternity is above or below 99 percent, there is a
presumption of paternity under either set of circumstances.) We
are concerned for the economic well-being of women and children,
but worry that we may be going overboard in our zeal to "nail"
irresponsible men.

Establishment of Child Support Orders

• Because the income shares model is based on the income of
both parents, and women traditionally earn less than men, certain
anomalies are automatically built into the results. For example,
assignment of financial responsibility on a basis strictly
proportional to income does not take into account the amount of
disposable or discretionary income left to each parent after
obligations are met. We are concerned that arbitrary application
of support formulas could result in one parent being left
relatively well-off while the other parent had barely enough cash
left to meet expenses. We would also hesitate to support a policy
which could lead to taking away from the custodial parent the
option of not working, depending upon the circumstances of the
individual case. It is not entirely clear, for example, what would
happen in a situation in which 1) the custodial parent has income-
earning skills, but either has not worked for several years while
raising children or feels the need to stop working because of the
new and/or additional responsibilities of being a single parent;
and 2) the noncustodial parent insists on the unfairness of a full-
support obligation, despite having more than enough income to
support the children, just to "punish" the custodial parent. We
fear the likelihood of situations in which women with fewer
resources, less earning power and greater family responsibilities
than the fathers of their children would tend to be the losers.

• The proposal indicates that for noncustodial parents with
little or no income, the support guidelines would be based on
assumed income equivalent to a full-time minimum wage job.
Following this statement through to its logical conclusion leads to

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several inequitable possibilities:

1) If both parents are working, they would both be responsible
for a share of the support, but if neither is working, only
the noncustodial parent (generally, the father) would have
income imputed to him and would therefore be responsible for
providing support.

2) If the noncustodial partner is a nonworking male, a working
woman would be legally required to provide a share of the
child support, but a nonworking woman would not be legally
required to provide anything.

We believe there is a need to calculate how these and other
possible situations would work out in actual practice, vis-a-vis
both work income and eligibility for various benefit programs, and
to analyze the findings before specific legislative proposals are
made.

Collection and Enforcement of Support Orders

• The frequently-referenced "federal office" needs more
clarification regarding its structure, how it would operate, and
where it would be housed. Since the proposal indicates that this
federal office both collects and distributes support payments, it
is unclear how it corresponds to the earlier description of
allocation of responsibilities. Theoretically, it could be
envisioned as a part of the IRS, as a part of the SSA, or as an
independent agency calling on the expertise and resources of both
of those agencies. Of those three options, we would favor making
the program an arm of the SSA and utilizing the IRS as necessary.
The idea of the IRS as responsible for contact with people caught
up in the child support enforcement system is least desirable: the
agency has experience with payroll withholdings and audits, but it
is not known for its ability to deal with vulnerable people, its
helpfulness, or its concern for clients. (Our concerns about the
program administration responsibility are also discussed in the
Administrative Structure section above.) The cost of establishing
a large new bureaucracy, on the other hand, is probably not
feasible.

• The proposal refers to "certain limited circumstances" under
which noncustodial parents would be exempt from automatic wage
withholding, but those circumstances are not delineated. If the
exceptions are too extensive, the program might become too complex
or too watered down to function effectively. If they are too
limited, it runs the risk of unduly hurting noncustodial parents
who ought to be exempt for one reason or another.

• The proposal refers to state cooperation in the imposition
of penalties on noncustodial parents for failure to report income.

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This cooperation would be a condition for the receipt of federal
reimbursement for the costs of the state's paternity establishment
program. However, under the terms of the paternity establishment
section of the proposal, a state could choose (or be required) to
let the SSA handle that function. If a state was not carrying out
the paternity establishment function, there would be no question of
reimbursement and therefore no incentive for the state to cooperate
in imposing penalties (e.g., withholding of driver's license,
automobile registration, or other permits) .

• "An ALJ also could reduce arrearages by reducing the present
value of Social Security retirement benefits based upon changes in
the earnings records of noncustodial parents." — This proposal is
somewhat obscure, but presumably it means that arrearages would be
paid to the custodial parent in the present out of government funds
and the government would eventually recoup the money by "adjusting"
(falsifying?) the noncustodial parent's Social Security earnings
record (i.e., putting down a lower amount than actually earned so
that he would be eligible for a smaller benefit upon disability or
retirement) . If that interpretation is essentially correct, we
would strongly oppose it as having dire implications for the Social
Security program. Not only does it open the door for changing
entirely the concept of Social Security (a most undesirable
possibility) , but its ramifications cannot possibly have been
thought through. As much as we want to maximize income for
children, increasing future poverty among the aged is not the way
to do it. Further, the proposal potentially reduces the income
available in later years to the divorced mothers of these children,
to spouses and widows of subsequent marriages, and/or to other
surviving children, since benefits for all of these categories
depend on the earnings record of the primary wage earner.

Work and Training Requirements and Opportunities for Certain
Noncustodial Parents

• The post-JOBS "other activities" component is very vague,
particularly the requirement for inclusion of activities that
"promote the involvement of the noncustodial parent in activities
that benefit his or her children (e.g., attendance at parenting
classes or parent-child literacy classes, the provision of child
care or other in-kind services to his or her children)." It is
also undesirable for several reasons - it has nothing to do with
what the JOBS program was intended for; it has little to do with
income support; it plays without basis into the "social
engineering" and "behavior modification" trends that have begun to
permeate public benefit programs; and it makes unfounded
assumptions about noncustodial parents. (Why would anyone assume
that an unemployed or low income noncustodial parent who is unable
- not unwilling - to pay child support is in need of parenting
classes?)

200

Medicaid Eligibility and Medical Child Support Establishment and
Collection

• The proposal needs to indicate which category of medical
support obligation a noncustodial parent with an annual income of
exactly $20,000 would fit into (i.e., it is methodologically
incorrect to have the two categories labeled "under $20,000" and
"over $20,000") .

• The proposal states that "centralized information available
via the Federal collection and enforcement system would increase
third party recoveries from employer plans." The details as to how
this would work need to be spelled out, since it could have policy
implications for data sharing and privacy issues.

• One of the criteria for whether a noncustodial parent with
income below $20,000 has to use employer-provided dependent medical
coverage is whether "the employee payment for the dependent
coverage is less than the cost of Medicaid coverage." This
provision needs to be spelled out in much greater detail with
regard to what costs are meant, who is now responsible for meeting
them, who would be responsible if the suggested change were made,
and the implications for assured, continuing medical coverage for
the children who would be affected.

Assured Child Support Benefit

• The proposal states that noncustodial parents of children
without support awards could petition for an assured benefit, that
eligibility would be granted if the noncustodial parent has
cooperated in seeking to locate the custodial parent, and that
regulations will be promulgated re: granting of eligibility to a
noncustodial parent of children who have not been awarded support.
— All of the above is stated backwards: it needs to be corrected
to say just the opposite with respect to custodial and noncustodial
parents.

Advance Payment of the Earned Income Tax Credit

• Advance payment of the EITC is a good idea, but the details
need to be spelled out. It is unclear whether the advance EITC
payments would be made by the IRS or the SSA (i.e., the same
question as pertains to other program distributions) and whether
that same agency would be responsible for the calculations, the
accompanying paperwork, and the coordination of the EITC and child
support payments. We support the concept of receiving "the EITC on
a regular basis ... along with the child support payment", but we
would stress that the logistics involved in implementing a program
of advance/coordinated payments need to be both efficient and
reasonably streamlined. (A woman with children by two different

201

men who receives child support, assured benefit, and EITC should
not have to deal with 5 or 6 separate monthly checks that need to
be coordinated, cashed, etc.)

Interaction With and Modification To Other Government Programs

• In calculating AFDC benefits, "a State would be required to
assume that an AFDC unit is receiving the full amount of any
private child support obligation (or, where applicable, the maximum
assured child support benefit) , unless notified otherwise by the
Federal office." — It is simply not realistic to assume that there
would not be errors as well as paperwork and reporting delays on
the part of the Federal office. All such errors and delays would
impact negatively and unfairly on the income available to the
poorest single parent families. At the very least, since the
proposal indicates that the program would make extensive use of
modern technology, an "800 number" should be established with coded
access to the data files. A state would be required to call and
ascertain the private and federal benefits actually received in all
cases where the amount is in question or dispute. If it did not
make such a call, the state would be required to give the benefit
of the doubt to the recipient in calculating the AFDC benefit
amount, with a provision for recoupment in cases of overpayment.

• "Social insurance program benefits based on a noncustodial
parent's work history (i.e., disability and survivors' benefits)
and received by his or her children, would be deducted from the
child support owed by the noncustodial parent. In addition, the
assured payment would be reduced dollar-f or-dollar . " There are
several issues that are disturbing with respect to this provision
and would seem to merit further consideration:

1) In calculating the reduction in the assured benefit, there
would have to be an allowance for the fact that the assured
benefit covers all of the children in a family, whereas the
social insurance program benefits may be payable only to one
or some of the children.

2) There ought to be provisions for social insurance benefit
income disregards. (Certain disregards are included in the
description of the program's interaction with AFDC benefits,
but are not mentioned vis-a-vis social insurance benefits.)

3) Survivors' benefits would be deducted from the child
support owed? — Doesn't death absolve a parent from further
responsibility for making child support payments? The issue
here is that the assured benefit assumes the existence of a
noncustodial parent and a support order. The only possible
reason for deducting survivors' benefits from the child
support owed would be to insure that the assured benefit is
lowered by virtue of receipt of this income, but it opens up

202

the whole question of eligibility if the noncustodial parent
is deceased. We would hope that program eligibility would
extend to the low income child of a deceased noncustodial
parent .

Other Provisions

• "The Federal government must obtain demographic, income and
asset data on both custodial and noncustodial parents on a regular
basis." — The implications of this statement are rather
frightening, regardless of whether the data are to be collected on
all such parents or on a research sample, unless provision of the
information is on a purely voluntary, non-coercive basis.
Otherwise, anyone who has the misfortune of being the parent of a
child in any circumstance other than a traditional two-parent
intact family could be required to participate in a massive,
intrusive, highly personal and non-confidential data collection
effort.

203

Testimony Presented Before

Subcommittee on Human Resources
Committee of Ways and Means
U. S. House of Representatives

Submitted by Howard P. Schwartz, Ph.D.

Judicial Administrator

State of Kansas

(913) 296-4873

On Behalf of the
Conference of State Court Administrators (COSCA)

Effective child support enforcement is vital to children and families who depend
upon it, and by extension, to society at large. Child support helps provide the basic needs
of ever growing numbers of children, basic needs that must be met for an individual to
eventually grow and contribute to society We have a vested interest in our children and
child support enforcement continues to be one of the most important issues facing state
courts.

Court involvement in the implementation of child support enforcement is immense.
Many of the current federal mandates for Title IV-D program significantly impact state
courts, such as support guidelines, expedited process, review and adjustment, income
withholding, and automation requirements. Too often, federal legislation and resulting
federal regulations attempt to exclude or reduce the role of state courts in the Title IV-D
program I strongly believe this is the wrong approach which harms the program. Close
attention should be paid to the impact of proposed legislation on state courts. Any
proposed legislation should bring state courts into the Title IV-D programs as a partner in
solving the problems

There are several specific issues I would like to bring to your attention for
consideration

Non-AFPC Cost Recovery Fees for the Title IV-D Program

As you are aware, costs of the Title FV-D program are escalating and not all
persons needing services are receiving them because of lack of resources. It is unrealistic
to expect increases in federal administrative or incentive payments to states. We need to
consider other funding sources I believe state courts would support legislation that
proposes a minimum percentage fee be charged for each successful child support
collection. This idea was recommended in the General Accounting OfiBce (GAO) report,
"Opportunity to Defray Burgeoning Federal and State Non-AFDC Costs "

This system has been used by Kansas court trustee programs since their inception
in 1972. Further, effective January 1, 1992, our state required any fees collected by court
trustee programs be reinvested in the programs to expand child support enforcement
services We are now seeing the benefits of this reinvestment. This fee system is relatively
easy to administer, and it is fair. The fee, a minimum percentage of any amount collected,
is assessed against those individuals who f^nar:ially benefit from the support enforcement
services. While many IV-D agenciv.^ v.j^p>^jc any such fee, both from historical and
philosophical perspectives, the reality of today's economy dictates that the financial burden
be shared by those who directly benefit fi^om the services. Providing free services to those
who can afford to pay no longer makes sense in the frugal climate of today's economy.

An additional benefit is that fees for Non-AFDC services could reduce the federal
government's financial burden. I strongly urge Congress to consider mandating states
adopt a Non-AFDC cost recovery fee as recommended in the GAO report. Further, any
monies generated by Non-AFDC cost recovery fees be reinvested to expand the state child
support enforcement services.

204

Interstate Child Support Enforcement Act (ICSEA)

The proposed Interstate Child Support Enforcement Act (ICSEA) would
streamline and improve child support enforcement and collections generally, however,
state courts have concerns with several aspects of the act. The time frame allotted to
accomplish implementation of the numerous proposals contained in the ICSEA is far too
optimistic. The scope of the changes required by this act is immense, complicated, and
expensive. The implementation date of January 1996 is not realistic.

In addition to an unrealistic deadline, state courts have additional concerns. The
automation required by the ICSEA will be a major expenditure for many if not most state
court systems New software and updated hardware will be necessary to accomplish the
act's goals. The development and testing of software requires time and expertise.

This act permits income withholding issues to be contested in a far too
complicated manner. Contesting these issues in a state other than the state with original
jurisdiction defeats the purpose of having uniform procedures, and would cause
unnecessary delay to support recipients.

The proposed administrative fee, to be collected after current and past due support
and interest charges are collected, is an unrealistic assessment of most child support
collection situations. Collecting current child support due is frequently impossible. It
would be more eflBcient to assess any proposed fee as a percentage of successfiil
collections, as mentioned above.

Finally, the proposed centralized disbursement centers would defeat efficient
distribution and tracking of child support. States should be ordered to be as efiBcient as
possible, however, getting money to the custodial parent and child in a timely manner
should be the states priority, not a method of disbursement. Currently, Kansas clerks of
the district court process child support payments in all 105 counties. The clerks disburse
child support the same day it is received. Implementing a centralized disbursement center
in Kansas would not speed up disbursement, would be a more costly system, and would be
counterproductive in my view. Congress should address the results they want: timely
disbursement, and provide states the flexibility to determine the most eSective and
efficient system considering available resources and existing systems.

Downev/Hvde Proposal

Many of the proposals originally brought forth in the Downey/Hyde proposal are
still under consideration. While well intentioned, these proposals would not improve the
situation for those persons they are intended to benefit Federalization of child support
enforcement would needlessly complicate the process. States currently must work
vigilantly to keep up with increasing demands of processing cases and disbursing payments
to recipients. If child support enforcement for all 50 states was completely centralized, the
amount of time required to process payments, handle inquiries, and track compliance and
modifications would be totally unacceptable Centralization would increase the chances
for cases being lost, overlooked and bungled. A case would go from being one among
thousands to one among millions. What is already viewed by many of its recipients as a
cold and impersonal system would suddenly become even more so.

Further, involving Social Security Ac..JrJ^trc:ici'. (SSA) and the Internal Revenue
Service (IRS) will not streamline the process. These federal agencies are already
overwhelmed. Splitting jurisdiction of domestic cases increases the likelihood for
conftjsion, and probably would make time standards almost impossible to meet if
implemented on the federal level. Federally assured child support benefits would be no
different, for all intents and puqxjses, than the welfare payment it envisions replacing. Our
children would be better served by letting states continue handling child supp>ort
enforcement. Minimizing federal involvement would reduce confusion and increase
efficiency to the families and children involved.

205

Finally, we strongly encourage funding grants which allow states to fund efiForts to
comply with federal mandates Each state court system is unique, and has its own
exigencies and agencies Each state is in the best position to know what will work best for
its own individual situation. Historically, however, the Judiciary has not been brought into
the process early enough to make a meaningful contribution. State courts today need to
be a significant partner in improving child support collection. Federal child support
legislation has a major impact on the operations of the judiciary; however, no funds have
been made available to assist in compliance with such legislation A grant program would
be invaluable in aiding state courts in meeting federal mandates and to make genuine
progress in improving the welfare of children. Funds to assess procedures and functions
related to child support enforcement would allow courts to identify areas of need which
are most critical to efiBciently applying our dwindling resources. Treating the judiciary as
a partner in this process would improve procedures in child support cases more than any
arbitrary mandate could ever do.

206

STATEMENT OF HUGH COLE, PRESIDENT
EASTERN REGIONAL INTERSTATE CHILD SUPPORT ASSOCIATION

before

SUBCOMMITTEE ON HUMAN RESOURCES

WAYS AND MEANS COMMITTEE

U.S. HOUSE OF REPRESENTATIVES

June 23, 1993

On behalf of the Board of Directors and 4000 members of the Eastern
Regional Interstate Child Support Association (ERICSA) , I
appreciate this opportunity to comment on various proposals for
reforming the child support system.

My name is Hugh Cole. I serve as the Business Officer and Program
Administrator for the Child Support Program in Durham County
Department of Social Services, Durham, North Carolina. I eun
testifying on behalf of the Eastern Regional Interstate Child
Support Association, of which I currently serve as President.

ERICSA is a not-for-profit corporation representing child support
professionals nationwide, including caseworkers, child support
administrators, attorneys, judges and other judicial officials, and
administrative decision-makers. Since 1968, ERICSA has conducted
an annual training conference whose main focus is the interstate
child support enforcement process. Our annual conference has
served as a forum to improve communication and cooperation among
states and jurisdictions, to propose reforms in the courts and
child support enforcement systems, and to advance training and
professional knowledge for all persons actively participating in
the child support progreun.

The testimony which I am submitting has been approved and
recommended by the Executive Committee of ERICSA' s Board of
Directors.

I. State-Based Reform

We commend this committee for its longstanding commitment to
improved child support enforcement. The Child Support Enforcement
Amendments of 1984 and the Family Support Act of 1988 were greatly
needed legislation. However, the current child support system
continues to be in need of reform. This reform requires federal
and state legislation, as well as an infusion of resources.

Much of the curent debate has centered on whether some or all of
the child support services provided by state child support agencies
(IV-D agencies) should be federalized. ERICSA agrees with the
conclusion of the U.S. Commission on Interstate Child Support that
reforms to the child support system should occur within the context
of greater uniformity in the current state-based system, not the
creation of a new federal administrative system.

ERICSA opposes federalization of child support for a number of
reasons. It would fragment a case between state and federal courts
and agencies, resulting in the children and parents having to
appear in different forums in different locations. It would likely
decrease accessibility of services to custodial parents and further
remove accountability. It would not improve locate or enforcement
against the self-employed, two problems which states face and have
begun to develop innovative strategies to address. It prematurely
declares state efforts as "failed" when states have yet to "bear
fruit" from automated systems. Such systems are not required until
1995 and should greatly improve enforcement by allowing batch
processing of cases such as done in Massachusetts. Given such
results, ERICSA does not believe that federalization is in the best
interest of children.

207

Finally, we oppose federalization because it will result in huge
costs, with no guarantee of improvement, at a time when the federal
government is trying to reduce the federal deficit.

Rather than duplicating at the federal level evidentiary
procedures, resources and procedures for hearing contested cases,
and staff for handling uncontested cases — all of which are
already addressed by state laws and procedures — ERICSA strongly
urges Congress to give states the necessary tools to effectively
carry out the mission of the Title IV-D program. The remainder of
this testimony spells out what ERICSA believes are the most crucial
tools the states need, all of which are premised on the existence
of strong proactive leadership from the Federal Office of Child
Support Enforcement.

II. State and National Registries of Support Orders

To facilitate interstate enforcement, ERICSA recommends that each
state be required to establish state registries of support orders.
At a minimum, these registries should include orders being enforced
by the State IV-D program, and all nonlV-D orders where at least
one of the parties has requested placement of the order on the
registry. The registry should contain abstracted information from
the support order, such as the ncunes and addresses of the parties,
names and dates of birth of the children, and support payment
terms, including arrearage paybac]c amounts.

ERICSA strongly believes that such registries should be maintained
at the state level. It is crucial that states have quick access to
information about support orders in order to comply with the review
and adjustment requirements of the Family Support Act of 1988.

In addition, ERICSA recommends the creation of a national registry
of support orders. Such a registry should not duplicate
information on file with state registries of support orders. Such
duplication would not only be an unnecessary expenditure, but would
also result in concerns about ensuring the registry promptly and
accurately receives updated information as orders are modified.
Rather, the national registry should contain extremely limited
abstracted information. We recommend that the information be
limited to the names and social security numbers of the parties,
and the state that issued the support order. Such a registry would
facilitate interstate enforcement by serving as a "pointer." It
would quickly identify all states with a support order involving
the obligor, thereby allowing the national network discussed below
to target W-4 information about the obligor to those states.

III. National Computer Network

ERICSA strongly supports a national computer network that is built
upon linkages between state automated child support systems and the
federal parent locate service or CSENet. Such a network would
allow control to be maintained at the the state level where program
information is needed yet allow states to work with sister state
agencies and their state data bases.

IV. W-4 Reporting

ERICSA strongly supports a federal requirement that all employers
be required to report new hires. We recommend that such reporting
be to state child support agencies in order to ensure that an
agency with a "vested" interest in child support enforcement is in
a position to monitor employer compliance. Through the national
computer network, the W-4 information can be matched against
support orders maintained on any state registry of support orders.
The ultimate outcome is the scune as a national data base of
employees without the additional cost. ERICSA is also concerned
that if the employee data is maintained at the national level there
will be delays in matching the W-4 information against support
orders. The Congressional Budget Office estimated that there would

208

be 30 million W-4 forms filed each year under the Commission's
recommendations. It will be necessary to match these W-4 forms
against the potential of 10 million child support orders. Since
almost 2/3 of child support cases are intrastate where the obligor
lives in the same state as the obligee, a state-maintained W-4 data
base matched against a state registry of support orders will result
in much prompter enforcement for the majority of cases than a
federally maintained system. For example, the current delay in
getting locate responses from the Federal Parent Locate Service is
from six weeks to several months. The national registry of support
orders would facilitate the W-4 matching in interstate cases and
reduce costs.

Contrary to the Interstate Commission's recommendation, however, we
do not recommend that the W-4 form solicit information from the
employee about his or her child support obligations. Such a
requirement may result in inaccurate information which must then be
corrected at administrative costs and delays. The most important
reason for implementing a national W-4 reporting system is to
improve the ability to locate obligors. Therefore, what is most
crucial is address information about the employer and employee.
Additionally, it is crucial that the information be reported to the
child support agency within 10 working days — not a longer period
that is tied into payroll.

ERICSA also strongly supports a federal requirement that all
employers be required to recognize and enforce income withholding
orders issued by any state, regardless of whether the employer does
business in the rendering state.

V. Locate Resources

ERICSA strongly supports the Interstate Commission's recommendation
that the federal statutory definition of "locate" include income
and assets. We support both automated and nonautomated interfaces
between a state child support agency and state data bases, such as
identified by the Interstate Commission. However, ERICSA has
concerns about who should be required to pay for automating state
data bases. ERICSA recommends that IV-D agencies should only be
required to pay for any reprogramming necessary to allow tape or
on-line transmission. Such a limitation would also limit federal
expenditures .

To further facilitate matches between obligors and persons on state
data bases, ERICSA recommends that a person's social security
number should be required as the identifier on all state-maintained
data bases.

Finally, ERICSA strongly supports access by child support agencies
to NCIC and NLETS. Such access puts child support payment
collection on equal footing with other law enforcement activities.
It is important that obligors recognize the seriousness of their
child support obligations. The current system is anomalous in that
child support offices located in prosecutor offices have access to
NCIC and NLETS data but child support offices located in state
department of human services do not. To facilitate access to NCIC
and NLETS information, we strongly support the Interstate
Commission's recommendation that states define child support
agencies as law enforcement agencies so that they can obtain an ORI
number.

VI. The Uniform Interstate Family Support Act

The most frequently used remedy for establishing and enforcing
child support in interstate child support cases is the Uniform
Reciprocal Enforcement of Support Act (URESA) . The name is
actually a misnomer as the Act is not uniform. Not only does URESA
exist in a different version in every state, but the Act itself
predates the establishment of the IV-D progam in 1975.

209

The National Conference of Commissioners on Uniform State Laws
recently overhauled URESA by drafting a new act, the Uniform
Interstate Family Support Act (UIFSA) . This Act contains a number
of significant changes which ERICSA has long advocated:

o UIFSA allows only one support order to be in effect at
any one time. It provides for modification only in the state that
issued the support order, unless all parties have left that state
or agreed in writing for another state to exercise jurisdiction.

o UIFSA provides for one-state proceedings, such as a
support or paternity action pursuant to a long arm statute, and
enforcement by direct income withholding. UIFSA also retains, with
modification, the traditional two-state URESA proceeding.

o UIFSA authorizes transmission of evidence by electronic
means and provides for telephone hearings.

o Information transmitted in the interstate forms is made
prima facie evidence.

In order to ensure that UIFSA is truly a uniform act, ERICSA urges
Congress to require states to enact UIFSA verbatim. If, however.
Congress allows states to enact the Act in a "substantially
similar" form, it is essential that the Secretary of Health and
Human Services promulgate regulations defining what is a
substantially similar act.

VII. Paternity

ERICSA strongly supports a requirement that states establish
nonadversarial procedures for the establishment of paternity. We
support hospital-based paternity acknowledgment procedures. Any
acknowledgment should detail the parties' due process rights,
including notice of any right to gentic testing and consequences if
a party fails to request a genetic test. The acknowledgment should
be signed by the mother as well as by the putative father. State
legislation also needs to address how an acknowledgment would be
obtained where there is a presumed father other than the person
acknowledging paternity. We also support procedures whereby a
paternity acknowledgment can be filed with the court and create a
presumption of paternity. If there is no objection in a specified
time period, the court should then be able to administratively
enter a paternity adjudication based on the acknowledgment.

Where paternity is contested, ERICSA recommends that Congress
require states, as a condition of receiving federal funds, to have
state statutes that (1) create a presumption of paternity based on
genetic test results and (2) authorize the admissiblity of the
genetic test results without further foundation if the tests are
performed by a laboratory accredited by the American Society for
Histocompatibility and Immunogenetics (ASHI) or the American
Association of Blood Banks (AABB) , subject to specific objections
filed by any party within 20 days of the filing of the genetic test
report with the court or administrative agency.

VIII. Staffing

Child support workers currently operate under staggering caseloads.
The average caseload for a fulltime employee is over 1000 cases.
It is crucial that Congress and state legislatures address the
situation in order to ensure that children receive effective,
timely child support services. ERICSA strongly supports the
recommendation of the Interstate Commission that the Secretary of
Health and Human Services conduct state-specific staffing studies.
States should then be required to comply with the recommended
ratios in order to continue receiving federal funds.

210

IX. Training

Custodial parents and caseworkers alike complain that filing an
interstate case is like sending it into a black hole. Often
inappropriate remedies are selected. Cases are ineffectively
prosecuted, and communication and cooperation are often lacking.

Child support professionals receive almost no education about case
processing requirements in other states. Attorneys and judges
receive very little training about child support enforcement in
their own state, much less in anyone else's.

The American Bar Association provides interstate training but
attendance at a course is limited to encourage group participation.
The few professional associations, such as ERICSA, that provide
child support training do so mainly in the form of annual training
conferences, which by definition, cannot get into the nuts and
bolts of interstate case processing in particular states.

ERICSA recommends that the Federal Office of Child Support
Enforcement place a high priority on developing training on
interstate child support enforcement, as well as other child
support issues. States should also devote adequate resources to
training. Joint regional seminars and training material are a
highly appropriate vehicle for this endeavor.

X. Medical Support

ERICSA strongly supports the Commission's recommendations regarding
improved health care support. We urge Congress in any health care
reform to address these issues. In particular, we urge Congress to
remove the ERISA preemption which prevents state regulation of
self-insured plans. Without such federal legislation, self-
insured plans are not subject to state legislation that prohibits
discrimination in dependency coverage or requires direct dealing
with a child's custodian who has paid the medical bills, regardless
of whether that person is the insured employee.

XI. Conclusion

In conclusion, ERICSA reiterates its support for the report of the
U.S. Commission on Interstate Child Support. The report presents
visionary, as well as practical, recommendations for reform of the
current child support system. Many of the Commission's
recommendations have been incorporated in the Interstate Child
Support Enforcement Act, recently filed by Senator Bradley and
Congresswoman Roukema , and in the Interstate Child Support Act of
1993 introduced by Congresswoman Kennelly. ERICSA is committed to
working toward the swift passage and implementation of the
provisions in these bills.

Thank you again for giving me the opportunity to testify on behalf
of ERICSA. We look forward to working with you to ensure that
children have the financial stability they so desperately need.

211

Roger F. Cay, Independent Research Consultant, 303 S. Tuxedo Dr., South Bend, Indiana, 46615

WRITTEN STATEMENT OF ROGER F. GAY
INDEPENDENT RESEARCH CONSULTANT

SUBMITTED FOR THE RECORD TO

THE SUBCOMMITTEE ON HUMAN RESOURCES,

COMMITTEE ON WAYS AND MEANS,

U.S. HOUSE OF REPRESENTATIVES

ON THE SUBJECT OF CHILD SUPPORT ENFORCEMENT

IN CONJUNCTION WITH THE OVERSIGHT HEARING
HELD THURSDAY, JUNE 10, 1993

Child Support Reforms in Perspective

The accumulation of child support arrearages will slow as the real rate of employment
improves. The rate of payment, as a percent of what is awarded, will not reach historical
highs because award levels and policy on past due payments are no longer realistically
related to children's needs and ability to pay. Greater and more immediate gains would
occur if child support policy is modified to enable adjustment to individual
circumstances. The strongest barrier to improvement is that there are many interests
that conflict with the health and well-being of families and children, outside government
as well as within, that have taken control.

Non-custodial parents have been scapegoats for increases in tlie rate of poverty
and unemployment. This deception went out of control in the 1980s, and lent itself to a
variety of corrupt purposes. Non-payment of child support was used in the 1 980s as the
basis for the development of a system that transfers billions of dollars annually from
federal coffers to state pork barrels, illegally forces private transfers of billions of
dollars annually to a special interest constituency, and has bred a wide range of human
rights abuses. There is not any reasonable basis for the current level of funding of child
support enforcement or the government powers that have recently been created and
are being imposed on non-custodial parents. There is certainly no excuse for
increasing either funding or government power for the purpose of enforcing child
support awards or further increasing child support orders.

I am submitting testimony as an independent researcher and citizen. I have
studied child support and the 1980s child support reforms for the last four years. My
work has been focused on improvement of child support guidelines, but has crossed
over into many related areas including enforcement. I have submitted testimony to this
subcommittee twice before on topics directly related to this hearing; once on the
"Downey / Hyde child support and assurance proposal" and on child support and trends
in poverty. [1,2] I was also a major contributor to the minority report of the U.S.
Commission on Interstate Child Support submitted by Commissioner Don Chavez. [3]

In addition to those specifically mentioned in the hearing announcement, I am
familiar with several proposals currently under consideration by Congress, which are
included as parts of bills on a variety of subjects from credit regulation to employment
programs. The popularity of the child support issue in political rhetoric can lead to
redundancy of purpose in various proposals. I believe it is better to consolidate child
support proposals so that we can address the whole subject, not just look at one piece
out of context. Hearings such as this are important for that and other reasons.

I have stated in previous testimony that the dramatic reforms of the 1980s have
not served the purpose stated in public discourse on the subject. We have had child
support enforcement programs for decades. We have spent many billions of dollars to
see if such programs could be cost effective. At current spending levels, the program
loses money. Every bit of real data we've had indicated that such a program would lose
money. Every bit of real data we have indicates that increases in the enforcement

212

budget will result in increases in the loss to taxpayers. The fundamental problem is that
the child support enforcement program has not been designed for support of children,
but to support a corrupt political agenda. As a citizen, I am deeply embarrassed to
submit that. Yet, after a decade of unchecked growth and irrational spending increases.
Congress and now a third president, continue to support expansion of a program that
has served only corrupt political interests.

There has been an increase in gross child support payments as a direct result of
1980's child support reform. The mandate of presumptive child support guidelines in ail
cases involving the award of child support has led to dramatic, arbitrary increases in
awards, mostly to middle and upper income mothers. These payments are still paid
mostly by middle and upper income fathers. These are the same fathers who were
paying voluntarily before an all encompassing federal enforcement system was put into
place in the last decade. The payments they had been making were, at least in theory,
based on some sort of reasonatDle analysis of children's needs. The award increases
resulting from federal reforms are not related to the needs of children. In cases where
one parent receives public assistance, presumptive child support formulae are not a
new development and have not led to substantial increases in child support awards.

Less than one percent of all child support cases fit the stereotypical model
underlying the child support enforcement program that grew in the 1980s; that of a
women and children receiving public assistance, and a father under court order to pay
child support who is absent by choice and is financially capable of lifting himself, the
mother, and the children out of poverty but refuses to do so. Yet, the policing of people
who owe child support has evolved into an attack on every aspect of life for all divorced
and never-married fathers. Some politicians still discuss this issue as though it is a new
and unexplored option in welfare reform, promising whole new vistas of spending and
expansion of government powers. Taxpayers have been told, and are still being told by
agents from local government to the President, that there is great untapped income
potential in child support enforcement. President Clinton includes child support
enforcement in his budget proposal, claiming that exponential increases in spending on
child support enforcement will eventually lead to savings.

What They are Not
The Child Support Enforcement Program

I would like to state briefly what the child support enforcement program has not
been. It has not been a program aimed at reducing dependency on public assistance
programs sufficiently to save money. No one has ever shown sufficient collections
potential ior such a program to be successful, let alone to justify increased spending
and government powers from where we are today. The program is not primarily focused
on the problem of poverty, and it offers no solution to the problem of poverty. I want to
be perfectly clear that I am talking about programs aimed directly at extracting more
money from or punishing non-custodial parents; something that seems to have become
mostly political sport.

The primary effect the Child Support Enforcement Amendments of 1984 and the
Family Support Act of 1988 on private finances has been outside tfie legal limits of
federal government authority to become involved in family law issues; arbitrarily
increasing private transfers from adult males in the middle and upper income group to a
constituency that contributes millions of dollars to political campaigns, adult females
who are in the middle and upper income group. In addition, the program has increased
the transfer of federal tax dollars to state pork barrels. The latter effect has created a
clear conflict of interest for state legislators, the judiciary, and enforcement agencies
and has led to policies that have successfully invited human rights abuses.

Besides what have become well known as obvious abuses; the denial of due
process and the jailing of fathers for being unable to pay support for example, I want to
point out another mechanism of abuse that is enjoying a new openness. Known as the

213

"unclean hands doctrine", courts throughout the nation routinely deny non-custodial
parents fair consideration in any hearing, including hearings dealing with access to
children (an internationally recognized fundamental nght for both parent and child)
whenever child support payments are past due. In some jurisdictions, fathers are not
allowed to bring an action to court without first bringing their payments up to date. I
remember the case of a landlord who left his buildings in horrible condition and was
sentenced to live in one of those buildings. It seems to me that more than a few judges
and quite a few legislators and bureaucrats could use some time as a non-custodial
parent, behind in payments that he knows are unrelated to his children's needs, denied
the right to parent his own children, and repeatedly punished in as many ways as
people can think of, including loss of employment, destruction of credit, and public
humiliation. The proposals being considered in this heahng continue this same trend of
bringing more pain into already bruised lives, with no legitimate excuse for the abuse
that occurs even while many humane alternatives for helping families are available.

Parents Who Are Subject to Child Support Orders

It is equally important to say what parents are not. The child support
enforcement program geared up in the 1980s on a fraudulent premise. Proponents
claimed that "deadbeat dads" were a primary cause of child poverty. An example
comes from a report from the U.S. Office of Child Support Enforcement (OCSE), for the
pehod ending September 30, 1990 (page 5).

Financial dephvation due to non-support from a living parent is the
primary cause of welfare dependency in the United States, at great
cost to children and to the taxpayer. The problem of non-support has
become ever more serious over the years because of the increased
number of single-parent families, the great preponderance of which
are headed by women.

What can anyone say about someone else who can actually believe that fathers
who can, but are unwilling to pay child support are phmarily responsible for child
poverty in America? What; no poverty? That's not really believable to anyone with
common sense. If there is any accurate way to interpret the OCSE statement, it is only
by solving a built-in puzzle. Why are these parents not supporting their children? The
answer is that the vast majority are financially poor and unable to provide enough
financial child support to keep their families off welfare. Parents that "deprive" their
children of financial resources typically do not do so willingly. It would be much less
misleading if the statement had been rephrased to read as follows.

The primary cause of welfare dependency is poverty, effecting adults
and children alike. Programs such as AFDC, food stamps and housing
subsidies are costly. Many AFDC recipients are single mothers. The
number of single-parent households, the great preponderance of
which are headed by women, is higher than it was two decades ago,
but the most important factor conthbuting to the increase in the
number of people eligible for welfare is the economic recession, which
is characterized in part by a relatively high rate of unemployment.

Recent data on the poverty rate shows that since the 1980's child support
reforms took effect, the poverty rate in single-mother households has increased
disproportionately to the rest of the population. [1] Other characteristics of families with
children in poverty were given in a recent report from the Children's Defense Fund. [4]

In the 1980s, poverty reached a cross-section of Amehcan families
regardless of marital status. The chief causes were a decline in wages,
especially for young workers, declining effectiveness of government
poverty programs, and changes in the job market.

Only one-third of poor children are black.

214

More than two in five poor children live in families in which the father is
present.

Most poor families with children have one or more workers.

... nearly one in five poor families with children cannot escape poverty
even though the head of household works full time throughout the year.

Just like their married counterparts, divorced and never married fathers have
problems with unemployment, employment that doesn't pay enough to support a family,
and other causes of poverty. But I want to quote a year old television news story as
best I can remember it, to illustrate the perceived difference between married and
unmarried parents -- a stereotype that has been promoted by members of Congress,
especially candidates running for office, and by Presidents from 1980 to the present
day. The summary of this national news story, which I could tell was filled with
information from government sources, was that "it's bad enough that some fathers don't
love their children enough to support them; what's worse is that w« let them get away
with it."

I hope at least some who read this testimony or saw the news story are as
disturbed by that summary as I am. What's worse is the amount of effort by OCSE and
it's state and local agents, at taxpayer expense, that has gone into creating this sort of
bigotry. [10] What's worse is that our government has played and is playing on deep
emotional pain experienced by men and women who have gone through divorce or are
struggling to raise children alone, and built an agency with a multi-billion dollar annual
budget from fear and prejudice. The accusation that poor people don't love their
children is bigoted. Linking such an accusation with non-payment of court-ordered child
support, or even lack of paternity establishment does not provide a valid excuse for
making such charges.

The following is from the same OCSE report cited above.

According to the Census survey, the aggregate amourrt of child
support received in 1989, whether or not paid through the program
authohzed by title IV, part D of the Social Security Act, Was $11.2
billion, or 68.7 percent of the $16.3 billion due.

I want to make five specific points in reference to this data. The first is that this
data was taken on payments ordered before awards calculated by rigid formulae were
required to be treated as presumptively correct as mandated in the Family Support Act
of 1988. (The effective date of the mandate was November, 1939.) Support orders
written or updated since 1989 are higher on average, due to the use of the new
formulae. It has been quite apparent that new orders are often more than parents can
pay, which increases the amount of support that is overdue and the amount of support
that will never be paid.

The second point is that this data includes only what was actually due, in
contrast to the many reports that include mothers who aren't being paid because there
is no support order, the father is dead, or the children have reached the age of majority
and the order is no longer valid. It is not comparable to state data since states often
report arrearages redundantly.

The third is that the Census Bureau questioned mothers only. The results are
known to be biased. One study shows a potential bias of minus 20 percent. Although I
doubt adding 20 percent to the amount reported as paid would give a very accurate
result, it is important to remember that the truth is probably that somewhere between 70
and 90 percent of what was due was paid. The primary source of revenue was
payments made voluntarily by fathers who were fully employed. Studies show that
payments made by mothers, who compose approximately 20 percent of all non-
custodial parents, are few and far between.

215

Fourth; even a low end figure of 70 percent would be understandable given
employment rates and the quality of employment in 1989. Recent data from the GAO
indicates that 66 percent of custodial mothers with a child support award who do not
receive support, report that the reason they do not receive support is that the father is
unable to pay. Especially considering source bias, it is easy to see that this data
confirms what study after study, year after year has concluded; the primary cause of
non-payment is that the payer is unable to pay.

Finally, when fathers can pay but don't, there is evidence that even this behavior
is often linked with a strong commitment to the well-being of their children. The limited
family model that government has chosen to enforce, where the role of father is
confined to financial provider to the mother, is not always considered to be in the
children's best interest. [5] Parents know what is best for their children more reliably
than government. There is no excuse for distant legislative and regulatory bodies and
commissions trying to second guess the decisions and actions of individual parents.
The worst examples of public policy development I have seen, are the lumping of all
divorced and never marned fathers into a single group subject to new constraints on
individual freedoms, and the lumping of all women receiving public assistance into a
single group that in public policy debate are consistently treated as freeloaders who
don't really need help.

President Clinton, as most people know, has not only endorsed the Reagan era
welfare reforms, but has taken personal credit for the idea as head of the National
Governor's Association during that time. In promoting his new "investment" proposal,
which includes a sharp increase in the child support enforcement budget. President
Clinton has stated that we should make parents responsible, that twenty billion dollars
in child support is owed each year, and that we should not let twenty billion dollars in
child support go unpaid. I have gone to some effort to find out just what twenty billion
dollars the president has been referring to, but haven't been able to get an answer. On
one hand, current awards stand at about twenty billion dollars. But even biased data
indicates that the majohty of that is paid, not overdue.

On the other hand, he could be referhng to families that do not have a support
order. A recent article in Speak Out For Children, a newsletter published by Children's
Rights Council, a top national children's advocacy organization, summanzed
information from a recent GAO report as follows. [5]

Where there is no child support award (and therefore, no child support is
due from the father, or the father may not know of the existence of the child),
the mothers report:

... 76 percent of mothers who live in the same state as the father ...
report that child support collection is not an issue in their case.

... In cases where the father lives in another state: ... 68 percent where
child support is not an issue.

The Real Agenda

The federal government pays much of the cost of operating the child support
enforcement program for a caseload composed of both AFDC and non-AFDC cases,
pumping billions of dollars into states. In addition to paying a percentage of the cost of
maintaining the program, the Child Support Enforcement Amendments of 1984
provided an incentive program that was designed as though it was intended to promote
efficiency. The program pays a bonus to states, amounting in total to billions of dollars,
for operating a child support enforcement program. The amount paid to any given state
can vary depending on a ratio of "collections" to a fraction of the cost of administering
the program. The definition of "collections" includes payments that would be made
voluntarily even if the program didn't exist, but have been ordered to be paid through
the child support enforcement agency.

216

In that same act, OCSE was given funds and authority to provide "technical
assistance" to states for creation of child support guidelines, which were to be used
with judicial discretion. The Family Support Act of 1988 altered the application of child
support guidelines from discretionary tools to rigid formula for calculation of a child
support award. Support enforcement agencies are judged by the "efficiency" formula
and potentially benefit from the outcome. But OCSE was given control of the
development of child support guidelines, and the authohty to regulate states and their
application of guidelines. The result was not an increase in efficiency or a dramatic
reduction in AFDC. The agency managed to manipulate award levels, gouging fathers
who were able to pay and already were, in order to artificially inflate the amount of
"collections" recorded.

Data taken since the mandate took effect in late 1989 indicates with great
consistency that awards calculated by use of these formulae are irrebuttable. Parents
who were already voluntarily paying a reasonable amount of child support became the
subject of new unreasonable support orders, which in turn served — not children or
taxpayers — but the state arms of the OCSE bureaucracy, and a special interest
constituency well known for generous contributions to political candidates; single,
middle and upper income women represented by groups with an expressed interest in
transferring wealth and power from men to women. By illegal means, OCSE has
managed to force an arbitrary transfer of billions of dollars from divorced and never
married fathers, to these single mothers. In the process of doing so, they have taken
billions of dollars in federal incentive payments for purposes unrelated to the interests
of federal taxpayers.

Conclusion

The child support enforcement process today, begins by depriving the soon-to-
be paying parent of his / her hght of due process by application of irrebuttable child
support formulae. It is very easy for most parents who are able to pay higher awards, to
see that the amount being awarded is unrelated to their children's needs.
Approximately half the total gross award of child support under current formulae is
spousal maintenance. The award of spousal maintenance as part of a child support
award is illegal in most states because spousal maintenance can be awarded
separately when it is appropriate. For those states in which spousal maintenance is not
allowed, the award of spousal maintenance as part of a child support award is illegal
because spousal maintenance is not allowed.

Past increases in spending on enforcement came at a time when low income
families were most vulnerable. During an economic recession marked by high
unemployment, everybody wanted somebody to be angry at. In this cycle, single fathers
and mothers became scapegoats. In the process, a variety of government powers have
been created; taking unjustifiably from fathers the fruits of their labor, their relationship
with their children, and ultimately their children's health. Certainly, the child support
reforms of the 1980s have detracted from the nation's health as well.

People with little or no income can't pay more child support. So far, they have
unwillingly served by staying in jail, often for arbitrary lengths of time, providing
publicity for officials wanting to look tough for their own local constituency. Money from
this program gets passed to local officials who have not been monitored on the basis of
remaining within Constitutional boundaries. Local judges have become profiteers,
working for, instead of separate from the administrative branch of government.
Corruption of the relationship between the branches of government has led to the most
sehous threat to human rights.

For more than a decade, government has consistently taken the position that
parents are responsible for their children and therefore solely to blame for child
poverty. Only the inverse is absolutely clear. With a very small percentage of the
population as the exception to the rule; when parents are able to care for their children,
they do. We should not make the mistake of crediting an enforcement agency for what

217

parents are willing to do, and have always done themselves when possible, or
condemning parents just to provide a government agency an excuse to exist.
Vilification and subsequent punishment of adults and children whose families have
been shattered or were never adequately formed is not a helping hand. Assuming
improvement of economic conditions, especially the availability of education and
training and good jobs for more people, it is the parents themselves who will deserve
credit for improvements in the record of child support payments.

Now this hearing asks for comments on proposals for more federal spending on
the child support enforcement program and greater police powers for the enforcement
of child support. I've said too little so far about the systematic elimination of human
rights that has occurred in the name of child support enforcement. But let me point out
that almost every proposal I have seen on reform of the child support system relates to
more spending and some rather bizarre expansions of government power linked to
elimination of human rights. Trials where due process is intentionally denied, arbitrary
transfers of private funds, creating criminal penalties for fathers who cross state lines
while owing child support, unjustifiable intrusions on privacy and jailing people
indefinitely for owing a debt are among the human hghts abuses either occurring or
proposed. There is even a section in a proposal that I otherwise favor, that would
create forced labor camps for fathers who fall behind on their payments.

It is perfectly clear that the primary driving force behind the explosive growth of
our child support bureaucracy and the accompanying explosion in federal police
powers isn't a desire to reduce the burden on taxpayers by reducing welfare rolls, and
the momentum toward abusive treatment of fathers doesn't fit anywhere in a "helping
hand" agenda. Whether we look at the correlation between poverty and formation of
single parent households also in poverty, or simply cite the failure of expensive
enforcement programs to move sufficient numbers of women and children from public
assistance programs, the root reality is the same. It is in fact, quite difficult to
misinterpret the situation so badly as to suggest greater investment in child support
enforcement is worthwhile. It is also difficult not to conclude that police action is already
over-stepping rational and Constitutional boundaries.

References

1 . Gay, Roger F., Written statement on the subject of Changes in the Poverty Rate and

Distribution of Income, submitted for the record to the Subcommittee on Human
Resources, Committee on Ways and Means, U.S. House of Representatives,
September 10, 1992.

2. Gay, Roger F., Written statement on the subject of the Downey / Hyde child support

enforcement and assurance proposal, submitted for the record to the
Subcommittee on Human Resources, Committee on Ways and Means, U.S.
House of Representatives, July 17, 1992.

3. Chavez, Don, Commissioner (editor Phil Holman), Minority (Dissenting) Report of the

U.S. Commission on Interstate Child Support, presented to Congress in June,
1992.

4. Johnson, Clifford M., Leticia Miranda, Arloc Sherman and James D. Weil, 1991,

Child Poverty in America, Children's Defense Fund, Washington, D.C. ISSN:1055-
9221.

5. Furstenberg, Frank F., Caring and Paying: What Fathers and Mothers Say About

Child Support, Manpower Demonstration Research Corporation, Family Support
Act of 1988 authorized the Parents' Fair Share Demonstration, July 1992.

6. Children's Rights Council, Mothers Say Fathers Unable to Pay, a review of a GAO

report on Interstate Child Support entitled; Mothers Report Receiving Less
Support From Out-Of-State Fathers, GAO/HRD-92-39, January 9, 1992, review in

218

Speak Out for Children, Children's Rights Council Washington DC, Winter
1992/1993.

7. Gay, Roger F., An Alternative Child Support Guideline for States to Consider,

Preliminary Draft, Prepared as a Handout for Presentation at the Seventh National
Conference of the Children's Rights Council held April 28 - May 2, 1993 Holiday
Inn Bethesda, Maryland.

8. Gay, Roger P., Rational Basis is the Key Focus in Emerging 'Third Generation' Child

Support Technology, in Proceedings of the Seventh Annual Conference of the
Children's Rights Council, Holiday Inn, Bethesda, MD, April 28 - May 2, 1993.

9. Gay, Roger P., A Brief History of Prevailing Child Support Doctrine, in Proceedings of

the Sixth Annual Conference of the National Council for Children's Rights,
Arlington, VA, March 19-22, 1992.

10. The federal Office of Child Support Enforcement is a leader in taxpayer funded

propaganda, but states are also guilty. Residents of Washington State for
example, can call a toll free number, (800) 442-KIDS, and hear the claim that 87%
of people who receive welfare, are eligible because they do not receive child
support. For a more detailed information on the relationship between poverty and
child support, see 1 & 9.

219

(Eh

ildren ' s

u:^

******<

JliJest jjjarent ^s -jljoth 4^arent:

'*********♦*»»»««•<

t*********4

ember: Children's Rights Council (National), Children's Rights
Council of Illinois, Parents' and Children's Equality,
Indiana Council for Children's Rights, National
Congress for Men and Children, and other Children's
Rights organizations.

P.O. Box: 389, Hutsonville, XL 62433 Tel: 317-297-5202
******************************************************************
THE JUDICIAL SYSTEM IS A ZOKE-- ENGAGED IN DESTROYING CHILDREN

Honorable Congressman Harold Ford c/o/ ^^ hary,jLj 'O^-M^'" ^'

Ms Janice Mays, Chief Counsel and'Staff Director 1^^^

.Committee on Ways and Means, U.S. House of Representatives
Dear Chairman Ford: June 10, 1993

I came to the U.S. in 1976 with an american dream of equality, justice,

and to have a better family life. My dream became nightmare when I was

forced to be a "visitor" to my own son. My son and I cried every day

in our efforts to have my son both'^his parents as "parents". I could

not believe that this was happening in a civilized country like the United

States

Family values are to
beautiful daughter,
courts -- states and
recognized as a pare
I lost in all levels
imposed on me as I "
with many others tha
system runs a parall
intents and mandates
to provide children
was the legislative
legislative intents
neecL-to rewrite and
that^lre binding.

o important to me. I live w
my father and my brother. I

federal to remain in ray so
nt. Unfortunately, just lik

of our judicial systems an
was pressing the matter vi
t the judicial system is a
el government of their own
. For last few years the la
with two parents after divo
intent. But the judges hav
for economic gain. Therefor
write statutes in clear and

ith my new wife, a

fouoht in all levels of
n ' s life and to be
e all other 96% fathers,
d sanctions were
orously." Now I admit
ZOKE. The judicial
and ignores legislative
w makers have done a lot

rce atleast that

e ignored all these
e, there is a strong

simple languages so

; Bar association and
for the purpose of economic r
a drastic reduction of court
visitation and power model sy
(22 cir .X 2 Judges x $150,000
per year). Ofcourse, judges a

their bread and butter the

- ^- But under no circumtanc
nation should be substituted
bill as a matter of power mod
and want to take revenge at t
else. Anger and personal fsel
the betterment of our childre

others who oppose this matter --do it

easons' nothing else. There will be

litigation related to child custody and
ndrome.Eocf, State will save atleast
.00) =$6600000. OO/yr (6.6 million dollars
nd attorneys love litigation --its
refore they have reasons to oppose •
es the future of the children of this
for economic gain. Other oppose this

el beha|Vior who wants to control,

he cost of the lives of children --nothing
ing of revenge should be set aside for
n's lives.

Many argues that presumptive joint custody should not be there .as -
'"ttie~'paferits "can not' get alone with each other--i,e, they got divorced.
This argument is vague and is without any scfe'ntific basis. Disagreements
between the parents are present in all families -- divorce or no
divorce .

Sole custody and 98« of the fathers as visitors to their own children
have been destructive to our children. All most all criminals, and
"problem-children (person)" come from single parent mat ernal homes.
My own son suffers from Attention Deficit Disorder, Parental Alienation
Syndrome , Attention Deficit Hyperactivity and other' psychological
Disorders due to this sole-custody / visitor imposition, and Courts
inability to recognize and admit facts. There are mountain of research
which shows that Presumptive Joint Custody is in the best interest
of children and is also a constitutional mandate.

220

Dr. Frank Williams of the Cedars-Sinai Hospital in Los Angeles,
after extensive research over period of several years found that
fiven warring parents, with a small amount of parenting education,
can learn to function sufficiently to share the parenting of their
children post divorce. Dr. William says that the worst thing we
can do to children is to create a "parentectomy" -- the removal
of a parent from the child's life.

Dr. Joan Kelly, co-author of "Surviving the Break-up" also
finds that a small amount of parenting information enable many
parents to function better after divorce in raising their children.

Dr. John Guidubaldi of Kent State University, Kent, Ohio, who
conducted the largest impact of divorce on children research,
(699 children over 7 years) finds that children need both fathers
and mothers, for healthy child development.

According to studies done by Drs. Jessica and Nancy Thoennes on
900 families in various custody arrangements that were followed
over a period of several years, parent with Joint Physical Custody
reported the most cooperation, even three years following divorce.

There is the myth in some legal and judicial thinking that joint
custody can only be effectively undertaken by cooperative parents.
To the contrary joint custody provides one of the best methods of
stimulating a degree of significant and meaningful cooperation
in warring parents who would otherwise continue years of battling
to the detriment of their children. The reason of battle between
parent is parental loss. This simple thing has never been understood

by our primitive judicial systems. The judicial systems in the
U.S.A. are engaged in destroying the future of children of this
nation for their personal business gain. The sole custody arrangements
have created many problems, including:

Psychological, Abduction, False Allegations of Abuse, Visitation
Problems etc etc.

The Judicial System in the USA has never done anything meaningful

to cure visitation problems. The are years of battling between

the parents, particularly ferociously when one parent abuses

the power of sole custody and the other parent fights the abuse

in an attempt to gain back his or her lost parental identity.

The only way to solve most of these problems is to keep both

parents as parents and i,e, JOINT CUSTODY. - PRESUMPTIVE.

Emotional support is more important than Fihancial support. When
a Lther does not get to see his children — and the zoking Judxcxal

does not resolve that most important problem how do you expect

that father to pay child support???? Children need fathers and

- mothers for proper development. Wh^ children are forced to divorce
■their fathers °'"lS IT A CIVILIZeS ACTION IN A CIVILIZED COUNTRY

'■"who is worried about human rights all over the world and treats
their own divorced fathers as Ath class, citizens 1^^°" "^"^. „,,
fathers to be financially responsible--then you havet<lreat fathers
as parents --not as_ disposable parents . Bring a Federal- Law _- .

-irpVsing cbmpul'sive Joint Custody and enforce visitation— ^""^

abolish absolute immunity of judges and punish the judges who ignores
legislative mandates and intents. THEN YOU WILL COLLECT CHILD
SUPPORT MONEY.

Sincerely,

AM^^^C:^

Subhen Ghosh

cc: Congressman Hamilton, Jacobs.

221

Testimony of June Castellano, Esq.

Staff Attorney

Greater Upstate Law Project

87 N. Clinton Avenue, Rochester, New York 14604

(716) 454-6500

Introduction

I am submitting this testimony based on my experiences as a New York state legal
services attorney concentrating on family and public benefits issues. I will focus my remarks
on two areas of requested comments - the status of child support enforcement programs and
child support assurance.

Child Support Enforcement

As a legal services attorney, 1 network regularly with other poverty law advocates
throughout the state. I have a view of the child support system based on the perceptions of low-
income custodial and non-custodial parents. 1 will briefly summarize some of our experiences
in New York state. From the standpoint of custodial parents, the system still engenders delays
and frustrations despite legislative improvements over the years.

I am currently counsel on two pieces of litigation that have arisen as a result of the
infringement of the rights of IV-D clients by the state. One case deals with the lack of adequate
notice and grievance procedures for public assistance recipients who fail to receive the $50 pass-
through disregard. The other case involves the failure of child support offices to pay support
to former AFDC families and keep AFDC families on the public rolls indefinitely even when
they have adequate support.

When they do leave AFDC and eventually start collecting support, these families usually
do not receive arrears monies owed them. The state opts to reimburse its own arrears first,
leaving the family to manage solely on current support. The months following welfare
dependency are financially critical for a household. Such a state fx)licy, allowed by the federal
government, is not sound public policy.

Custodial parents often complain to legal services staff that their local child support
offices do not pursue absent parents in a vigorous and timely fashion. This occurs despite the
enactment of timeframes standards and may require additional enforcement though litigation.

Low-income non-custodial parents represent a large segment of the enforcement pool
within the child support system. Here in New York, we have a minimum monthly order of
support which the courts apply against any support obligor. Many public assistance and
Supplemental Security Income recipients face child support obligations. Those obligors with low
wages often face large income executions to pay off accrued arrearages or retroactive support.
In legal services we often see family relationships that stabilize and de-stabilize over time. In
some instances we represent intact families aeainst the IV-D svstem because the child suooort
agency has continued to garnish the income of the former non-custodial parent, to satisfy arrears
owed the state for assistance paid to the family. In one such instance, the children who were
the original subjects of the support order were going hungry because of the amount of support
being taken from the now re-united father's wages. There is a clear need to prevent the
government from enforcing support obligations against intact or reunited families.

222

Child Support Assurance

New York's Child Assistance Program (CAP) is an excellent model for any child support
assurance proposal. The factor in New York's program that has the greatest impact on families
is the work incentive percentage built into the formula for receipt of benefits. New York's
program does not take a dollar for dollar reduction in benefits with earnings levels. Instead,
benefits decrease very gradually in an indexed fashion to allow recipients to retain more of their
earnings. In contrast to AFDC, which cuts a family's benefits by nearly a dollar for every
dollar earned, CAP reduces benefits by only 10 percent of earnings below the poverty level and
67 percent of earnings above the poverty level for a given family size. This, together with the
benefit payment, is what makes families better off on CAP than AFDC.

A child support assurance prop)osal should not be silent as to work incentives. For low-
income households to fully appreciate the benefits of child support assurance they need earnings
and they need access to a large percentage of those earnings. Without a generous work incentive
disregard, households have no incentive to leave AFDC and may in fact be worse off if the
assurance benefit is below the AFDC levels for the entire household in a given state.

The federal initiative needs to set benefit levels at realistic levels. The proposed level
of $2000 for one child does not provide enough income to the household. Furthermore when
linked to the amount of child support expected for one child, it represents a minimum amount
of under $39.00 a week. Under New York's present guidelines only non-custodial parents with
annual income just below $12,000 would pay such a low amount. New York's CAP amounts
of $350 per month for one child (with no earnings) and $443 for two children offer a more
appropriate supplement to earnings.

The federal proposal seeks to address what happens when a family does not have a
support award. The legislative draft should incorporate as fully as possible all of the parameters
that dictate exceptions to the requirement that the family have a support order. By making the
program available only to households with orders, the government would penalize many families
who through no fault of their own cannot obtain an order. Custodial parents on AFDC assign
their rights to support to their state to establish and collect obligations. Despite numerous
improvements in the child support systems state and local governments often fail miserably in
their attempts to obtain prompt orders of support.

The new federal program should not exclude any household which has attempted to
obtain support, particularly through the current IV-D system. The legislation should be clear
as to its intent to allow custodial parents to participate in child support assurance whenever the
parent has sought to obtain support throughout the local IV-D agency.

Likewise, the proposal should offer a good cause exception to households who cannot
obtain support, as in cases of domestic violence where harm may come to the family if it
pursued support. These exceptions should be modelled after existing AFDC regulations
concerning good cause for failure to cooperate. They should also reflect instances when support
collection is impossible, such as where the non-custodial parent has died. Children should not
be excluded from a more advantageous benefit program because of circumstances beyond their
control.

Those families remaining on AFDC should not be relegated to a second-class welfare
system. Two-parent families should receive AFDC without an unemployment requirement. The
benefits they then receive should compare favorably with the assurance program. Applying a
monthly $50 disregard to all AFDC households in which a child support order exists would also
ensure that all families entitled to receive support actually obtain some benefit therefrom.

A child support assurance program should begin implementation on a voluntary basis to
allow households to judge for themselves in conjunction with their caseworker whether or not
they would be better off making the switch from AFDC. Families on child support assurance
benefits will still need access to child care and health benefits. These should continue for
families opting for the new system.

223

Conclusion

Child support enforcement and collection activities need to be streamlined and made more
equitable for both custodial and non-custodial parents. Further, to improve the lives of children
in the United States a child support assurance proposal must offer families a better alternative
to AFDC. Child support assurance moves in that general direction with the addition of a work
incentive and by opening the program to those seeking to obtain child support.

224

Illinois Task Force on Child Support

BOARD OF DIRECTORS
Joan S. Colen

Legal Auittanos Foundaljon

Aviva Futorian

Attonwy al Law

LEGISLATIVE ADVISORY
COMMITTEE

June 22, 1993

Janice Mays

Chief Counsel and Staff Director

Committee on Ways and Means

U.S. House of Representatives

1102 Longworth House Office Building

Washington, D.C. 20515

RE: Oversight Hearing on Child Support Enforcement

Dear Ms Mays:

The Illinois Task Force on Child Support thanks
Representative Ford and you for the opportunity to
submit the following comments to be included the
record of the June 10th hearing on child support
enforcement.

Status of the State Child Support Enforcement Program

The Illinois Task Force on Child Support is the only
watchdog of the Illinois Child Support Enforcement
Program. Unfortunately, many custodial parents are
not well served by the Illinois program. The fact
that the IV-D program in Illinois made a collection in
only 7% of its cases in FY90 is proof that the program
does not function as it should.

The program is not responsive to custodial parents
enrolled in the program. If custodial parents
enrolled in the program have questions or new
information about their cases they are instructed to
call an 800 number. The 800 number is constantly
busy. It can literally take days to get through on
the 800 number.

A major drawback of the Illinois program is
accountability. No one is responsible. Custodial
parents are not given the name of someone to call with
information or questions on their case. Instead,
every IV-D worker is suppose to be equally
knowledgeable. This approach fails miserably. The
system creates enormous frustration for clients and
ultimately fails to produce results.

The requirements of the Family Support Act of 1988,
particularly child support guidelines and wage
withholding, have improved the lot of custodial
parents and their children. The guidelines have
resulted in higher support awards. Unfortunately, the
currents guidelines in Illinois are not based on the
true cost of raising children and, therefore,

28 East Jackson Boulevard • Suite 605 • Chicago, Illinois 60604
(312)786-0293 • Fax (312) 427-4463

225

woefully inadequate. Immediate wage withholding is the single most
important tool in child support collection and enforcement.

Child Support Enforcement and Assurance Proposal

The Child Support Assurance Proposal is an excellent idea, a
guarenteed cash payment and medical benefits would go a long way
towards eradicating poverty among custodial parents and their
children.

The Task Force also endorses education and job training for non-
custodial parents unable to contribute to their children's
financial needs.

The Task Force opposes federalizing the state IV-D programs. The
ineffectiveness of the state IV-D programs inspires radical
proposals. But we fear that a system operated by the federal
government would be even worse than what we have now. We are
concerned that a federally operated system would be even less
accessible and accountable to custodial parents.

The proposed system is too complicated for custodial parents to
decipher. Some tasks remain the responsibility of the states,
while others are transferred to the federal government. Custodial
parents won't know who to contact about their cases. Such a system
would create a myriad of opportunities for information on cases to
be lost or fall through the cracks.

Instead of creating an entirely new system, the Task Force urges
the federal government to exert more control over the state IV-D
programs through its oversight authority. Presently, the Office
of Child Support Enforcement is four to five years behind in its
audits of the state IV-D programs. If a state program is found not
to be in compliance, it's too easy for the state director to claim
the problem existed five years ago, but has since been fixed.
Audits must be done promptly at the end of the year to be
meaningful .

The Office of Child Support Enforcement should develop effective
sanctions to impose on state IV-D programs that are not in
compliance. The threat of withholding federal funding does not
have much impact since it is rarely done.

The Task Force encourage the federal government to implement
programs so that agencies such as the Social Security
Administration and the Internal Revenue Service can assist the
state IV-D programs in establishing and enforcing child support
orders.

72-449 0-93-9

226

National Conference of Cominissions on Uniform State Laws

The Task Force urges Congress to pass the Uniform Interstate Family
Support Act (UIFSA). UIFSA is a revision of the Uniform Reciprocal
Enforcement of Support Act (URESA) . UIFSA was adopted by the
National Conference of Commissioners on Uniform State Laws last
August .

Congressional action mandating all the states adopt UIFSA verbatim
would significantly increase the establishment and collection of
interstate child support orders. The current system simply does
not work. The best way for non-custodial parents to avoid child
support is to move out of state. By replacing URESA with UIFSA the
interstate system will be streamlined and simplified. No longer
will children and custodial parents face the prospect of chronic
child support problems when either they or the non-custodial
parents move to another state.

Again, thank you for the opportunity to submit comments.

Marion Wanless
Executive Director

227

National Society of
Professional Engineers

Statement for the Record

of the

National Society of Professional Engineers

Child Support Enforcement

before the

Subcommittee on Human Resources

Committee on Ways and Means

U.S. House of Representatives

June 10, 1993

The National Society of Professional Engineers expresses its opposition to provisions
contained in legislation introduced in the 103rd Congress that adversely impact
professional licensure. We are opposed to Section 408 of the Interstate Child Support
Enforcement Act (S. 689 - Bradley, D-NJ))/H,R. 1600 - Roukema, R-NJ), and
Section 406 of the Interstate Child Support Enforcement Act of 1993 (H.R. 1961 -
Kennelly, D-CT). which require the states to adopt "procedures under which the State
occupational licensing and regulating departments and agencies may not issue or
renew occupational, professional, or business licenses" of individuals who are
delinquent in their child support obligations or individuals who are the subject of
outstanding failure to appear warrants. We urge you not to incorporate these
provisions in future versions of child support enforcement legislation.

The National Society of Professional Engineers was founded in 1934 and represents
75,000 engineers and engineering students in 535 local chapters and 54 state and
territorial societies. Over 75 percent of our members are licensed professional
engineers. NSPE is a broad-based interdisciplinary society representing all technical
disciplines and all areas of engineering practice, including government, industry,
education, private practice, and construction.

While our members strongly support efforts by the federal and state governments to
use enforcement procedures to execute court judgements, we do not feel the sanctions
mandated upon the states in Section 408 of S. 689/H.R. 1600 or Section 406 of H.R.
1961 are an appropriate use of this authority. Federal and state efforts to revoke,
limit, or disqualify licensees from lawful practice based upon non-practice related
criteria, as proposed by these sections, are troublesome on constitutional grounds and
will set an alarming precedent by placing the discretion and authority to detennine the
practice qualifications of licensed professionals outside of the authority of the
appropriate state licensing board. We oppose such efforts for the following reasons
as well:

1420 KING SWEET

ALEXANDRIA. VA 22314-2794

703 '684' 2800 FAX 703 ' 836 • 4375

228

• Non-practice related criteria restrain the right of citizens to practice a
profession by creating a wholly unrelated and arbitrary standard by which
one's fitness to practice a profession is judged;

• Non-practice related criteria are typically vague and overly broad and grant too
much discretion and authority to enforcement officials;

• Non-practice related criteria are applied selectively only to those individuals
required to hold a license to practice a profession, thus discriminating against
those individuals;

• Non-practice related criteria frequently require, under penalty of law, that all
seeking licensure or renewal make self-incriminating statements or face fines
or other penalties;

• Non-practice related criteria distract the state licensing authority from its
primary obligation of regulating professional practice to protect the public
interest.

We are also concerned that the sections, by mandating that state governments adopt
these punitive licensure procedures (as a condition for receiving federal financial
assistance), are an infringement on the traditional prerogative of state governments to
regulate professions and occupations. We are not alone in this sentiment. In fact,
several members of the U.S. Commission on Interstate Child Support, upon whose
recommendations the legislation is based, expressed similar objections to the
recommendation embodied in Section 408 of S. 689/H.R. 1600 and Section 406 of
H.R. 1961. Those Commissioners appropriately recognized that licensure matters
were within the province of state government. We urge you to strike from the
legislation these provisions, which clearly do not have the unanimous support of the
Commission members.

Again, we support general efforts to improve and strengthen traditional judicial and
other enforcement procedures to enhance the collection of child support obligations,
but we oppose efforts, such as that recommended in Section 408 of S. 689/H.R. 1600
and Section 406 of H.R. 1961, which limit or disqualify licensees from lawful
practice based upon non-practice related criteria.

We appreciate the opportunity to submit comments on this issue and look forward to
continuing to provide assistance as you develop comprehensive child support
enforcement legislation. Thank you for considering our views.

229
NEW JERSEY COUNCIL FOR CHILDREN'S RIGHTS

POSITION PAPER: CUSTODY, VISITATION, AND THE WELFARE OF CHILDREN

Februarys, 1993

Introduction

The current divorce laws of New Jersey do little to assure children of their right to frequent and
unimpeded contact with, and the love, care, company, affection and support of the non-custodial
parent [1]. The loss of contact or insufficient contact with one parent has been shown to lead to
significant problems both for the individual children and for society at large.

According to the recent Census Report [2] approximately 16 million children nationwide are liv-
ing in single-parent homes. A significant portion of these children suffer financial hardship. Addi-
tionally, many of these children display social and psychological problems which include inability
to relate to authority figures, poor academic performance, emotional instability, drug and alcohol
abuse, promiscuity, inability to maintain close relationships, insecurity, and criminal activity.
These problems carry a high cost to the children, their parents, the State and the future of this
nation.

Financial Needs of Children

About 69% of the child support owed in 1989 was collected, according to reports of the women
owed the support [3]; the true percentage may be considerably higher, as these women will tend to
underreport [4]. Nevertheless, a significant amount of child support - in 1989, possibly as much
as $5.1 billion - was not paid and was owing. The New Jersey Council for Children's Rights
(NJCCR) considers the underpayment of child support to be a serious problem that needs to be
addressed by legislation to assure children of adequate means of support. Recent Federal legisla-
tion, designed to encourage the states to increase the amount of child support paid, has utterly
failed: between 1987 and 1989, the percentage of child support collected (of that owed) has
remained constant [3].

The federally-mandated Child Support Enforcement program in this state is costly and inefficient.
"Deadbeat Dad" raids average about 10% collected of arrears claimed [5]. Fathers who are jailed
cost taxpayers between $75 and $150 per day [6]; and for many of these fathers, jailing ignores
the underlying economic causes that are the root of the problem. The current enforcement pro-
gram involves significant State resources: the state Office of Child Support Enforcement, the var-
ious county Probation Departments, the state Family Court system, the various county Sheriff's,
and, of course, "space" in already overcrowded county jails [7]. In addition, jailing for debt is
unconstitutional.

"Statutes or ordinances, designed as debt collecting devices under the guise of penal laws,
contravene the constitutional prohibition against imprisonment for debt." [8]

The Census Report [9] also shows that 38% of all fathers not living with their children do NOT
have visitation with their children. Incredibly, 45% of these fathers pay their child support . This

230

NEW JERSEY COUNCIL FOR CHILDREN'S RIGHTS

is in contrast with 79% of fathers with visitation who pay their child support; 90% of fathers with
joint custody pay their child support. These figures clearly show that fathers that see their children
pay child support. In fact, then, there is a direct and significant correlation between a father's
involvement with their children and their willingness to pay child support. NJCCR feels that
applying positive pressure on fathers -- by giving joint custody, or in the alternative, extensive
visitation to fathers -- is going to be significantly more successful that the current negative prac-
tice - putting fathers in jail. Partial payment and nonpayment frequently results from economic
matters beyond the control of the nonpaying spouse. In addition, it is questionable whether the
"average" citizen can afford to pay the mandated guideline amount [10].

Another factor that must be mentioned is the extremely high percentage of fathers with visitation
that experience visitational interference [11]. NJCCR feels that violations of the custody/visita-
tion portion of a court Order are just as serious as violations of the child support portion of a court
Order. Even though there are criminal penalties [12] for custody /visitation interference, this law is
not "enforced." This failure on the part of law enforcement demoralizes fathers and contributes to
failure to pay child support. In addition to that, the failure to address the problems such interfer-
ence cause children, as well as their non-custodial parents, can only exacerbate an already stress-
ful situation for all.

Many of our federal and state officials claim that child support - money - and custody/visitation
- emotional and psychological support - are completely unrelated. NJCCR cannot agree for the
reasons given above. NJCCR feels that every child deserves two involved and contributing par-
ents, and further feels that money is not more important than time, for the reasons given below.

The Social and Psychological Welfare of Children

It is established that children from "broken homes" have more problems and lead less healthy and
less productive lives. NJCCR submits that an emerging body of research will reinforce conclu-
sively that many problems are a direct result of single-parent households and father absence.

Many people subscribe to the view that, if only some stability could be interjected into the child's
post-divorce life, children, being "so resilient," will soon come around. Many unthinking individ-
uals feel that this stability is best had with Mom - subscribing to the Tender Years Doctrine, or as
it is called today, "the primary psychological parent doctrine." The best research shows that the
effects of divorce on children are very much long-term.

"A potent force links the child's self-esteem with continued contact with the father in the
post-divorce family. At the 18-month follow-up mark, and again at 4 to 5 years afterward,
we found a significant connection between low self-esteem and depression in the child,
and continued disappointment with the father's infrequent or erratic visiting." [13]

The study just mentioned was again done at the 15-year mark, and the continued effects of the
divorce were observed [14]. NJCCR feels that the law must take a hand in rectifying the severe
damage that has already been perpetrated on countless children.

"If anything, the courts and the embattled partners and their respective attorneys have

231
NEW JERSEY COUNCIL FOR CHILDREN'S RIGHTS

directed their energies toward imposing restrictions and conditions that further encumber
a relationship which, under even the best of circumstances, requires care and encourage-
ment." [15]

Most criminal offenders in New Jersey come from single-parent homes. One study shows that
71% of all criminal offenders were not raised in two-parent homes [16]. Representatives from the
highly-acclaimed, youth-intervention program. Scared Straight, confirm this conclusion [17]. As
it is expected that the current divorce rate will continue unabated, and the number of children liv-
ing in single-parent homes will continue to increase, society will have to pay the price for increas-
ing crime and the number of people incarcerated [18].

Presumptive Joint Custody and Minimum Visitation

Joint custody must be given presumptive preference over all other forms of custody, and it must
be made impossible for a parent to defeat this presumption by merely being uncooperative.
NJCCR does not support the commonly-held view that only cooperative parents can "work
together" when it comes to the children. NJCCR feels that parents with joint custody, no matter
how uncooperative they may be in the midst of divorce litigation, will tend to eventually put their
differences behind themselves [19]. In fact, the inequitable situation that exists today, where the
mother gets sole custody in 95% of the cases [20] and the father gets to pay child support and see
his children infrequently, if at all, can only breed intense resentment, which is many cases will
lead to all the more litigation, and, in turn, to less cooperation, and so on, in a endless cycle.

NJCCR also feels that it is necessary to have a minimum visitation standard that guarantees par-
ents the opportunity to remain involved in their children's lives. NJCCR supports this minimum
contact standard notwithstanding the legal custody arrangement. One such Minimum Visitation
Law has already been passed in Texas [21].

Conclusion

New Jersey lawmakers have already acknowledged that children who have regular access to
BOTH parents are much less likely to have enduring social and psychological problems.

"The Legislature finds and declares that it is in the public policy of this State to assure
minor children of frequent and continuing contact with both parents after the parents have
separated or dissolved their marriage and that it is in the public interest to encourage par-
ents to share the rights and and responsibilities of child rearing in order to effect this pol-
icy." [22]

Unfortunately, the State Family Court system is doing little or nothing to effect the clearly stated
intent of the Legislature. Judicial discretion in family matters allows family courts to ignore this
law, and for all practical purposes, this law is ineffective in achieving its highly desirable purpose.
Good laws, already on the books, are not properly enforced, and this is not the only example of
this phenomenon, as we have seen above.

It is in the interests of the State to encourage fathers to become more involved in their children's

232

NEW JERSEY COUNCIL FOR CHILDREN'S RIGHTS

lives. A Minimum Visitation Law and a Presumptive Joint Custody law will give fathers the
opportunity to become more involved in the upbringing of children that do not live with them,
will increase child support payment compliance rates, reducing the need for the involvement of
costly State agencies, and will greatly increase the likelihood that children living in single-parent
homes will be brought up to become functional, capable, responsible, law-abiding citizens.

233

NEW JERSEY COUNCIL FOR CHILDREN'S RIGHTS

Appendix 1: The Cost of Child Support Enforcement

The original purpose behind the Family Support Acts of 1984 and 1988 was to reduce the amount
of Aid to Dependent Families (AFDC) paid by the federal government. To that end, it was
decided that states should be required to pursue the establishment of paternity for children born
out-of-wedlock and to better enforce existing and resulting child support awards; states that did
not comply would risk losing federal funding. Any money obtained for the support of AFDC fam-
ilies (already paid to those families by the federal government) would be paid to the federal and
state governments as reimbursement, not paid to the AFDC families (though the first $50 paid
each month does go to the family). An additional "incentive" was given to the states: all support
payments obtained by the state through measurable (and reportable) means would be "rewarded"
by a federal payment to the state equal to some fraction of the reportable support payments
obtained. Practically speaking. New Jersey must obtain the support through wage garnishment,
payment through the probation department, or lump-sum payment as a condition for release from
incarceration, in order for the payment to be measurable and reportable. In this appendix several
facets of the cost and efficiency of these methods of child support enforcement are discussed. The
figures presented are from the Annual Report of the U.S. Office of Child Support Enforcement
(OCSE)[23].

Total Collections, Incentive Payements, and Caseload

The federal goverment has statistics vis a vis the various states concerning total collections (over
$6 billion nationwide in 1990), incentive payments (nearly $260 million nationwide in 1990), and
caseload (nearly 13 million nationwide in 1990). The interelation of these statistics reveals some
interesting further statistics. First we look at New Jersey's child suppport caseload, broken down
into its AFDC and non-AFDC components [24]. We note that the caseload is nearly equally
divided between the two subcategories.

Table 1: New Jersey Child Support Caseload

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Full text of "Child support enforcement : hearing before the Subcommittee on Human Resources of the Committee on Ways and Means, House of Representatives, One Hundred Third Congress, first session, June 10, 1993"

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