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State Child Support Debt Compromise Policies

State Child Support Agencies with Debt Compromise Policies

Holding HandsThe Office of Child Support Enforcement (OCSE) estimates that $100 billion in unpaid child support has accumulated since the inception of a national child support enforcement program in 1972. In an effort to reduce or potentially eliminate uncollectible debt, some states use debt compromise, a process whereby a state settles a portion or all of the child support debt owed to the state by a noncustodial parent.

Child support enforcement agencies in 29 states operate fully implemented or pilot debt compromise programs, and another 17 states settle arrearage debt on a case-by-case basis. Of the 29 states that have debt compromise programs, 24 are fully implemented and five are pilot programs. The remaining five states do not allow compromise of arrearages.

 


 

State Child Support Agencies with Debt Compromise Policies

 

State Type of Program Description of Policy                                                                            Source

Alabama

Case-by-case

An interest rebate law allows for forgiveness of interest owed to the state and custodial parent (if the custodial parent agrees), in cases where current support is paid consistently for at least 12 months.

Code of Alabama §30-3-6.1.

Alaska

Fully Implemented

The state offers debt forgiveness for noncustodial parents who have accrued at least $1,500 in state-owed child support arrears and meets other eligibility criteria. If the parent complies with the arrears forgiveness agreement, state-owed debt will be forgiven in stages over a six year period. 

AS 25.27.020(f) and 15 AAC 125.650 to 125.695

Arizona

Fully Implemented

Arizona Division of Child Support Enforcement (DCSE) has offered a settlement program to noncustodial parents (NCPs) since 2009. NCPs with arrears can discuss negotiated settlement options for either state-owed or custodial parent (CP)-owed arrears. The state talks with both parties but doesn't speak for the CP if arrears are owed to her/him. DCSE has collected over $2 million in settlements since the program started and closed 147 cases.

Region IX

California

Fully Implemented

Compromise of Arrears Program (COAP)-

The California Department of Child Support Services' Compromise of Arrears Program (COAP) aims to increase support collected for families and the state General Fund, and to reduce arrears owed to the State. COAP allows the acceptance of an offer to compromise a portion of a noncustodial parent’s permanently assigned arrears in exchange for partial payment of a delinquent child support debt.

California Family Code Section 17560

Colorado

Case-by-case

County CSE offices have the ability to offer arrears compromise for assigned child support arrears. It is up to the counties to determine if they want to implement an arrears compromise program and if so, what criteria they wish to use. 

DHHS/IG 2007

Connecticut

Fully Implemented

Arrears Adjustment Program- CT has implemented two arrears programs. The first one, the Arrears Adjustment Program (AAP), is designed to reduce state-owed debt as well as encourage the positive involvement of NCPs in the lives of their children and to pay current support. 

Conn. Gen. Stat. §17b-179b

Delaware

Case-by-case

Debt forgiveness is rare.

DHHS/IG 2007

District of Columbia

Fully Implemented

Fresh Start- The District’s Fresh Start program encourages noncustodial parents to make consistent support payments by reducing state-owed arrears incrementally as the noncustodial parent pays consistently. 100% of state-owed arrears are forgiven after 24 months of consistent payments. Noncustodial parents are eligible for this program if they have not made payments for the past 36 months.

D.C. Child Support Services Division

Florida

Case-by-case

Debt forgiveness is rare.

DHHS/IG 2007

Georgia

Case-by-case

A state statute gives the child support program the authority to waive, reduce, or negotiate the payment of state-owed arrears for administrative child support orders if it is determined that there is good cause for nonpayment or that enforcement would result in substantial and unreasonable hardship to the parent or parents responsible for the support. Courts have discretion in applying or waiving past due interest owed on arrears.

 O.C.G.A 7-4-12.1

Hawaii

Case-by-case

Debt forgiveness is rare.

DHHS/IG 2007

Illinois

Fully Implemented

Project Clean Slate- Low-income noncustodial parents (NCPs) may apply for forgiveness of assigned arrears in exchange for payment of current support. NCPs must have been demonstrably unable to pay the assigned support at the time it was due, and must meet low-income standards.

Healthcare and Family Services, Division of Child Support Services

Indiana*

Pilot Program

The IN Child Support Bureau does not have statutory authority to compromise state-owed arrears; only the Governor and the Attorney General have that authority.  As part of a grant from the Federal Office of Child Support Enforcement to provide employment and other supportive services to ex-offenders, the Governor's office/Attorney General agreed to compromise state-owed arrears for a limited number of ex-offenders who successfully participated in the federally funded program and met other conditions.  That federal grant ended in 2010, but the program continues to serve ex-offenders.

State

Iowa*

Pilot Program

The IA Child Support Recovery Unit has legal authority, as part of a pilot program, to forgive a percentage of child support debt owed to the state, provided that the non-custodial parent makes regular support payments in compliance with a court order. As of September 2011, the CSRU did not have an active pilot program in this area.

State

Kansas

Pilot Program

Arrears Management Program- The Kansas program currently has 18 noncustodial parents enrolled, and has seen a total of 37 participants since 07/01/2008. By paying their full amount of current support each month, the NCPs move through each of the three tiers of this debt-elimination program.  At each tier, they earn a percentage reduction in their state-owed arrears.  The total amount of support collected for the time period of 7/1/08 – 9/30/10 is $43,436.  The total amount of state-owed arrears eliminated during that period is $9,762.

State

Kentucky

Pilot Program

Arrearage Compromise Program- The goal of this pilot program is to assist noncustodial parents who have large arrearages owed to the state by reducing the amount owed in return for consistent payments for a specified period of time. The pilot is operating in Jefferson County. To be eligible, noncustodial parents must owe a minimum of $10,000 in arrears.

State

Louisiana

Case-by-case

 

DHHS/IG 2007

Maine

Case-by-case

Debt forgiveness is rare.

DHHS/IG 2007

Maryland

Fully Implemented

Payment Initiative Program- Eligibility for this statewide program is limited to noncustodial parents with incomes below 225 percent of the federal poverty level. In authorizing participation in the program, the child support program must consider whether the noncustodial parent has the current ability to pay; if the reduction of arrearages will enhance the noncustodial parent’s economic stability; and if the agreement serves the best interests of the children. If any of these factors are met, child support must agree to reduce the arrears owed to the state by 50% after 12 months of consecutive payment of the court-ordered amount. After 24 months of regular payments, the arrearages must be reduced to zero.

Md. Family Law Code § 10-112.1

Massachusetts

Fully Implemented

MA child support regulations allow for the settlement of interest, penalties and arrears, as well as equitable adjustments of arrears. The Child Support Commissioner may waive all or a portion of the interest and penalties owed to the Commonwealth if the Commissioner determines such waiver is in the best interest of the Commonwealth and will maximize collection of current child support and past-due support. The Commissioner may also accept an offer in settlement that is less than the full amount of state-owed arrears, where there is serious doubt as to liability or collectibility of such arrearages. The Commissioner may also equitably adjust the amount of child support arrearages owed to the Commonwealth when the obligor has no present or future ability to pay the full arrearages.

830 CMR 119A.6.2

Michigan

Fully Implemented

Several laws allow for adjustment of arrears and interest. In some cases, the Department of Human Services or its designee may use discretion to settle and compromise state-owed arrears (MCL 205.13). Other laws allow noncustodial parents who do not have the ability to pay the arrearage in full, presently or in the foreseeable future, to request a payment plan (for a minimum of 24 months). At the completion of the payment plan, the court may waive any remaining arrears owed to the state (MCL 552.605e). Additionally, noncustodial parents may request a payment plan as a means to have the surcharge (interest) waived or reduced if regular payments are made (MCL 552.603d).

MCL 205.13, MCL 552.605e, MCL 552.603d

Minnesota

Fully Implemented

Strategies to Help Low-Income Families- A 2007 state statute gives the parties (including the public authority with assigned arrears) the authority to compromise unpaid support debts or arrearages owed by one party to another, whether or not docketed as a judgment. The statute is part of a project called “Strategies to Help Low Income Families” (SHLIF) that includes written policy identifying a set of preventative and early intervention actions when setting and modifying support orders, collecting current support and collecting arrears, including developing community partner collaborations. The policy gives counties the discretion to reduce permanently assigned public assistance arrears on a case-by-case basis in accordance with the statute and requires counties to develop their own internal guidelines for implementing SHLIP policies.

Minn. Stat. §518A.62.

Montana

Fully Implemented

 

DHHS/IG 2007

Nebraska

Fully Implemented

NE will only consider arrears-only cases where there are no dollars owed to the custodial parent and will only forgive the interest portion of the state-owed debt. The noncustodial parent must make a lump sum payment towards the remainder.

DHHS/IG 2007

Nevada

Case-by-case

 

DHHS/IG 2007

New Hampshire

Case-by-case

The NH Division of Child Support Services does not have a formal debt compromise policy. Child support workers do have some discretion to negotiate agreements to secure current support that may include forgiveness of assistance debt owed to the state that accrued prior to the establishment of a child support order and which was based on imputed income. Any such agreement must be approved by the child support worker's supervisor.

DHHS/IG 2007

New Jersey

Case-by-case

 

DHHS/IG 2007

New Mexico

Fully Implemented

Fresh Start Arrears Management Program- The goal of this program is to eliminate uncollectible state-owed debt. It is limited to arrears only cases with a minimum of $1,000 in arrears. As of August 31, 2011, there were 1424 participants; 1069 of those cases had all debt eliminated and cases were closed. Remainder had state-owed debt reduced. Collected $2,168,554; reduced NM arrears balances by $17,748,726.

State

New York

Pilot Program

Arrears Credit Program- The New York City Office of Child Support Enforcement is operated a pilot program designed to reduce arrears owed to the state if a noncustodial parent participated in an employment-oriented program, agreed to pay all of his/her active child support orders for 3 years, and met other requirements.

State

North Carolina

Fully Implemented

To be eligible for a state-owed debt compromise, the obligor must owe a minimum of $15,000 in state-owed arrears, agree to make 24 consecutive monthly payments for current support and an amount toward arrears, and comply with the agreement.

NC General Statute, Chapter 110, Section 135 (§ 110-135)

North Dakota

Fully Implemented

ND has 3 goals for its debt compromise program: motivate obligors to comply with long-term payment plan, eliminate uncollectible debt, and facilitate case closure where appropriate. Compromise of assigned arrears is permitted if an offer is received for at least 95% of the outstanding arrears balance (after subtracting all negotiable interest) or 90% with IV-D Director approval. Interest may be compromised when an obligor enters into a payment plan to avoid license suspension or other enforcement remedies or when an obligor has been making payments on a regular basis. In both cases, interest is not charged while regular payments are made and after one year of regular payments, any unpaid interest that had accrued before that date can be compromised. Interest can also be considered uncollectible under certain circumstances. Some situations are pre-approved, such as an obligor is receiving Supplemental Security Income. In these cases, a worker may prevent interest from accruing on the case and can request an adjustment to the payment record for any unpaid interest that has already accrued. In situations that are not pre-approved, the worker cannot suspend interest or have it waived as uncollectible without approval from the IV-D Director. In 2008, $1.4 million in principal and $3.9 million in interest was removed.

Regional profiles

Ohio

Fully Implemented

A regulation was issued in 2009 that allowed ODJFS to promulgate rules on the waiver and compromise of permanently assigned arrears. The Department developed rules that provide flexibility to local agencies in making these determinations. 

OAC 5101:12-60-70

Oklahoma

Fully Implemented

The state permits a waiver of some or all child support arrears with the approval of the court, provided the parents mutually agree (or the state agrees when the debt is owed to the state). Settlements of past support may include an agreement that the noncustodial parent make a lump sum partial payment or a series of payments toward the total amount of past support. Settlements also may include an agreement for the noncustodial parent to pay a specified number of current child support payments or in-kind payments in the future. In addition, the state has established an amnesty program for accrued interest owed to the state. The state attorney in the local district must approve all settlements of state-owed interest.

43 O.S. §112, Oklahoma Administrative Code 340:25-5-140, 56 O.S. §234.

Oregon

Fully Implemented

Satisfaction of Arrears for Less than Full Payment- The Division of Child Support may settle state-owed arrears for less than full payment if: 1) the arrears are a substantial hardship to the paying parent; or 2) a compromise will result in greater collections on the case; or 3) the obligor enters into an agreement with DCS to enhance the obligor's ability to pay support or enhance the obligor's relationship with the children for whom the obligor owes arrears.

OAR 137-055-6120

Pennsylvania

Case-by-case

Per PA Supreme Court Rule, any compromise of state-owed debt must be approved by the court.

State

Rhode Island

Case-by-case

RI may compromise interest on an ad hoc basis.

DHHS/IG 2007

South Carolina

Case-by-case

Debt forgiveness is rare.

DHHS/IG 2007

South Dakota

Case-by-case

 

DHHS/IG 2007

Tennessee

Case-by-case

In Tennessee, per statute, the Child Support Division is able to compromise state debt on an individual case basis. Each case must be evaluated individually and must have the approval by the Child Support Commissioner, Comptroller and Governor's office.

State

Utah

Fully Implemented

Prisoner Forgiveness Program- This program targets recently released prisoners and forgives state-owed arrears for those who are approved for the program and pay 12 consecutive months of current support plus a nominal amount toward arrears.

UT Admin. Code Rule R527-258

Vermont

Fully Implemented

Collection of child support debts shall be made as provided by this section and section 3902 of this title and by 15 V.S.A. chapter 11, subchapter 7. Regardless of the amount of Reach Up financial assistance paid, the court may limit the child support debt, taking into consideration the criteria of 15 V.S.A. § 659. The department for children and families and the responsible parent may limit the child support debt by stipulation which shall be enforceable on its terms unless it is modified.

Vt. Stat. Ann, Title 33 §3903.

Washington

Fully Implemented

Conference Board- The state established an administrative dispute resolution process through its Conference Boards to hear parents' requests to reduce the amount of arrears owed to the state and make determinations based on the individual circumstances. 

Rev. Code of Washington 74.20A.220, Washington Admin. Code 388-14A-6400 through 388-14A-6415.

West Virginia

Fully Implemented

This program allows forgiveness of interest for obligors who pay off all arrears owed over a certain period. This is a voluntary program and requires all parties to voluntarily agree to forgive the interest.

West Virginia Code §48-1-302 (c)

Wisconsin

Fully Implemented

Local child support agencies may forgive all or part of the state-owed arrears under a variety of circumstances, including when the obligor is unable to pay the arrearage based on income, earning capacity, and assets, or the obligor has a long-term disability.

Child Support Bulletin # CSB 11-09

Wyoming

Case-by-case

 

DHHS/IG 2007

 

* The program ended.

Note: For DHHS/IG 2007, see Department of Health and Human Services, Office of Inspector General, 2007, “State Use of Debt Compromise to Reduce Child Support Arrearages.” OEI-06-06-00070

Source: Federal Office of Child Support Enforcement.

Additional Resources

*PLEASE NOTE: The National Conference of State Legislatures is an organization serving state legislators and their staff. We cannot offer legal advice or assistance with individual cases, but we do try to answer questions on general topics.

For more information regarding NCSL's child support work, please visit our Child Support Homepage.

About This NCSL Project

NCSL staff in D.C. and Denver can provide comprehensive, thorough, and timely information on critical child support policy issues. We provide services to legislators and staff working to improve state policies affecting children and their families. NCSL's online clearinghouse for state legislators includes resources on child support police, financing, laws, research and promicing practices. Technical assistance visits to states are available to any state legisalture that would like training or assistance related to this topic.  

The Denver-based child support project staff focuses on state policy, tracking legislation and providing research and policy analysis, consultation, and technical assistance specifically geared to the legislative audience. Denver staff can be reached at (303) 364-7700 or cyf-info@ncsl.org.

NCSL staff in Washington, D.C. track and analyze federal legislation and policy and represent state legislatures on child support issues before Congress and the Administration. In D.C., Joy Johnson Wilson (joy.wilson@ncsl.org) and Rachel Morgan (rachel.morgan@ncsl.org) can be reached at (202) 624-5400.

The child support project and D.C. human services staff receive guidance and support from NCSL's Standing Committee on Health & Human Services.

 

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