April 2004 - Vol. 6, No. 3

• GAO Releases Report on Undistributed Child Support Collections
• Welfare Agencies Restrained from Sanctioning Clients in Two Court Cases
• Study Finds That Unilateral Divorce Has Little Impact on Divorce Rates; Some Positive Benefits
• Legal Barriers to Reentry From Prison Assessed
• Ohio Child Support Staff Covered Up Overpayments
• Louisiana Senate Committee Approves Bill to Criminalize Child Support Nonpayment

GAO Releases Report on Undistributed Child Support Collections

A recent report from the U.S. General Accounting Office (GAO), Child Support Enforcement: Better Data and More Information on Undistributed Collections Are Needed (GAO-04-377), analyzed the amount and causes of child support collections that are not distributed to families (undistributed collections), and looked at state and federal efforts to reduce them. It should be noted that the data available for the analysis were not in every case accurate and consistent because there has been no uniform mechanism in place to track undistributed collections. Among the report's findings:

• For nine states that provided sufficient information from which to analyze the data, intercepted joint tax refunds accounted for 27 to 48 percent of total undistributed collections. Joint tax refunds may be held by the state for a period of up to 180 days to allow a spouse to claim their share of the tax return that is not subject to the child support obligation. Many states routinely hold joint tax refunds for this maximum 180-day period.
• Information needed to determine the correct amount of the collection to be distributed to TANF and former TANF families was sometimes inaccurate or missing, and delayed distribution of these collections. In Florida, nearly 50% of its approximate $28 billion in undistributed collections could be attributed to difficulty in determining the correct amount owed to the government for custodial parents who received TANF benefits.
• The second-highest median amount of undistributed collections result from collections that were received before they were due. Twenty states reported that for non-TANF cases, collections that are received early are held by the state and not distributed to the custodial parent until due. Twenty-one states immediately distribute collections received before they are due.
• States varied in the types of collections they reported as undistributed, resulting in limited reliability and difficulty in comparing between states' performance on distributions. For example, some states reported collections to be distributed within 2 business days as undistributed, but others did not. OCSE is revising reporting for fiscal year 2004 to distinguish between collections that are pending distribution and undistributed collections that remain unresolved.
• State child support agencies reported earning almost $50 million in interest and income on undistributed collections in fiscal year 2002.

The report is available at www.gao.gov.

Welfare Agencies Restrained from Sanctioning Clients in Two Court Cases

Two court decisions have resulted in the restoration of benefits to clients sanctioned for noncooperation with TANF program requirements.

• In New York City, a settlement was reached in a class action lawsuit, Acevedo v. Turner, which challenged sanctions that were applied to recipients of public assistance and Medicaid who failed to cooperate with child support enforcement. The U.S. District Court, Southern District of New York agreed that the plaintiffs’ rights were violated because they were not provided with information on how to get the sanctions lifted. The New York Office of Child Support Enforcement (OCSE) was also cited for failing to lift the sanctions when plaintiffs were willing to comply or tried to comply. The plaintiffs were represented by the New York Legal Assistance Group.
• A federal judge in Texas issued a preliminary injunction against a state plan to cut off Medicaid benefits to welfare recipients who were meeting work requirements, but who failed to comply with a Personal Responsibility Agreement that required activities such as immunizing their children, abstaining from drug or alcohol abuse, and ensuring school attendance and regular medical and dental care for their children. Families would have been dropped from TANF, and the adult would have lost Medicaid coverage for noncompliance under the state’s attempted rules. The ruling, by U.S. District Judge Sam Sparks of Austin, Texas asserts that, “A state cannot withhold assistance from individuals who met the federal eligibility requirements, simply because the individuals do not meet the state’s additional requirements. Here, Texas is withholding Medicaid benefits from otherwise eligible individuals, based on their failure to meet state imposed conditions.” The lawsuit was brought by the Texas Welfare Reform Organization, the El Paso County Health District and two individual plaintiffs. For more information, see www.cppp.org.

Study Finds That Unilateral Divorce Has Little Impact on Divorce Rates; Some Positive Benefits

A recent study published by the National Bureau of Economic Research, Bargaining in the Shadow of the Law: Divorce Laws and Family Distress, by Betsey Stevenson and Justin Wolfers, found that “unilateral” or “no-fault” divorce laws have impacts on marriage that may surprise many in the field. The study looked at 37 states and the District of Columbia, where no-fault divorce laws, allowing one spouse to seek a divorce without the consent of the other, were established between 1969 and 1985. As indicators of wellbeing that could be quantified, the authors analyzed state data on suicide, domestic violence and spousal murder rates before and after the changes to divorce laws. Among the findings:

• When states changed to unilateral divorce laws, the divorce rate typically rose at the outset, but then fell below its pre-reform level.
• Total female suicide rates declined by approximately 16% in states that adopted unilateral divorce laws. There was no significant effect on male suicide rates.
• The incidence of domestic violence dropped by approximately 25% to nearly 35% in the states with unilateral divorce laws. The authors suggest that the drop could result from the potential victim’s increased access to leaving the marriage if abused.
• A decline in women murdered by intimates is indicated by the results that is associated with unilateral divorce reforms. No discernible effects were found for males murdered by intimates.

The authors suggest that unilateral divorce changes the balance of power in marriages, so that both partners work harder at making the marriage work in order to prevent divorce. Even couples who were not at risk of divorcing may benefit from the change in power that results from unilateral divorce laws. The report is available at www.nber.org.

Legal Barriers to Reentry From Prison Assessed

The Legal Action Center of New York has released a report on the legal barriers facing people with criminal records for all 50 states. The report finds that over the last 20 years, there have been intensified efforts at the federal and state level to expand penalties and restrict access to benefits, employment, parenting and voting for released prisoners, making it much more difficult for people with criminal records to participate in society.

The report is in three parts. The first is a catalogue of each state’s legal barriers to employment, housing, benefits, voting, access to criminal records, parenting and driving. In the second part, states are graded on their laws and policies as they affect prison reentry. The third part provides recommendations for federal and state policymakers that could help those with criminal records reintegrate into society.

The report also identifies some current state policies and practices that prevent prisoners from rebuilding their lives upon release from prison. These include:

• Even when a person is arrested but never convicted of a crime, thirty-seven states allow employers to ask about and consider the arrest, and to deny employment based on the arrest.
• Seventeen states have a lifetime ban on Food Stamps and TANF benefits for anyone convicted of drug-related felony. Twenty-one states have a more limited ban that can be lifted under certain circumstances.
• Forty-eight states place restrictions on the right to vote for persons with a felony conviction. In twelve states, the ban is for life for some or all who have a felony conviction.
• Conviction histories are made available to anyone on the internet in 28 states, allowing unlimited public access to criminal records without consent and without guidance on how to interpret the information.
• Twenty-seven states automatically suspend or revoke driver’s licenses for some or all drug offenses.
• The Higher Education Act of 1998 makes students convicted of drug-related offenses ineligible for any grant, loan or work assistance and the ban cannot be altered by the states.

The report, After Prison: Roadblocks to Reentry, is available at www.lac.org.

Ohio Child Support Staff Covered Up Overpayments

The Dayton Daily News has obtained documents that show that Montgomery County, Ohio child support enforcement officials created a false child support order to conceal the fact that a noncustodial parent had made $17,000 in overpayments on his order. The overpayments were discovered this month. Since 1997, the father’s employer had mistakenly garnished his wages at a higher rate than ordered. When the mistake was discovered, a false administrative child support order was created that eradicated the overpayment. The computer system was then altered to reflect the false order. After the alterations were made, the father was misrepresented as being $5,000 in arrears on his child support payments. Doug Thompson, the director of the Montgomery County Child Support Enforcement Agency said that the decision to falsify an order and alter the figures was “definitely hasty… It’s not one I would have made,” according to the newspaper report. Mr. Thompson stated that the original figures have been restored, and the agency will mediate settlement talks between the parents to attempt to reach agreement on a repayment plan. Without agreement, the amount of child support overpayments that the mother will be required to repay will be determined in court.

Louisiana Senate Committee Approves Bill to Criminalize Child Support Nonpayment

Louisiana is among several states considering bills that would increase criminal penalties for the nonpayment of child support (See March 2004 Policy Briefing for summaries of similar bills being considered in Alaska and Michigan.) Current Louisiana law provides for a maximum penalty of $500 or imprisonment for not more than six months for willful nonpayment. SB 633, introduced by State Senator Robert Kostelka would make it a crime if a support obligation is unpaid for a period of one year or is more than $5,000 in arrears. The penalty for a first offense would not change from current law. For a second or subsequent offense, a maximum fine of $2,500 or imprisonment with or without hard labor for a maximum of two years would apply. Restitution in the amount of unpaid child support would also be required. See www.legis.state.la.us.