Child support delinquents beware: The risk you're running just increased dramatically.
For more than a year, the Cabinet for Health and Family Services (CHFS) and the Department of Revenue in the Finance and Administration Cabinet have worked together to obtain payment in the most egregious cases of unpaid, past-due child support. In late January, that joint effort began working a lot faster.
Collaboration between the two agencies, authorized by the Legislature in 2002, required a good deal of manual work in the beginning, but now it is fully automated. That means CHFS can feed its lists of cases with sizeable past-due amounts straight into the Revenue Department's computer system, which makes it possible to seize bank accounts, wages and tax refunds and place liens against homes and other property.
"Centralizing state government's debt collection efforts allows for a much more efficient and effective method of collecting money owed to the commonwealth and its citizens," said Secretary of the Finance and Administration Cabinet Robbie Rudolph.
"Revenue has the expertise needed to enhance these collections, so we are happy to assist in the effort to collect past-due child support on behalf of Kentucky's children."
CHFS Secretary James W. Holsinger Jr., called the collaboration a prime example of the state's efforts to use available resources more efficiently.
"This partnership benefits taxpayers as well as the more than 190,000 Kentucky families who do not receive all the child support they are due," Dr. Holsinger said. "Most of those families struggle to make ends meet."
Noncustodial parents who have ignored their child support obligations will first get a letter from CHFS warning them they have 20 days to demonstrate a good-faith effort to pay up. If they fail to respond, the case will be turned over to the Revenue Department for collection.
The collaboration's results, already encouraging, should get markedly better. Working manually for about a year beginning in late 2002, Revenue collected $295,000 in delinquent child support -- a small but significant step toward reducing the more than $1.2 billion in past-due child support owed to Kentucky families.
"We expect to collect several million dollars a year in the automated world," said Mack Gillim, the Revenue Department's deputy commissioner of law.
Revenue's enforcement action netted one family $14,000 just before Christmas 2002. Other families "have called and said they were just thrilled" to receive money they should have gotten long ago, said Carolyn Osborne, who worked on the interagency collaboration for CHFS.
Taxpayers will benefit as well. That's because, in about one-third of delinquent child support cases, families are receiving government cash support through the Kentucky Transitional Assistance Program (K-TAP). During the fiscal year that ended last June, cash support for these families amounted to $84.3 million.
When delinquent child support is collected in such cases, the money is used to offset the welfare payments. Until all K-TAP payments made to a family are recouped, the state retains 30 cents of each dollar of child support collected, and 70 cents goes to the federal government. Similarly Medicaid payments for children's medical costs are recouped from child support collections.
The computerized interface between CHFS and Revenue cost about $200,000 to implement. With the collections made so far, the state is already well on the way toward recovering that cost, said Steve Veno, director of the Division of Child Support.
Veno believes the collaboration is unique in the nation. Last year, it won an accolade from the federal Office of Child Support Enforcement, which awarded Kentucky a Commissioner's Award for creative use of automation in increasing efficiency.
Veno said achieving a fully automated interface between the CHFS and Revenue computer systems took longer than he'd anticipated, but in retrospect he's glad it did. Over the months when much of the collaborative work was done by hand, project coordinators worked out glitches and "got it honed down to where it was a pretty efficient process," he said.
The joint project stems from a study commissioned by CHFS to improve Kentucky's child support system. In its report on the study, delivered three years ago, Policy Studies Inc. recommended several steps, including collaboration with Revenue, improved training for local child support workers and clearer division of responsibilities between CHFS and the contractors -- usually county attorneys -- who provide legal services to child support clients.
Since then CHFS has made contractors responsible for all local services while strengthening its own role in support and training. Senate Bill 218, enacted in 2000, encouraged collaboration with Revenue to improve child support collection. Senate Bill 133, signed into law in 2002, authorized Revenue to use the same powers to collect delinquent child support as it uses to collect delinquent taxes.
Now that automation will allow Revenue to use its enforcement powers to full effect, CHFS will prepare a users' manual and train contracting officials on procedural steps that should make the collaboration work better, Osborne said.
In particular, she said, staff in county attorneys' offices should make a prompt entry in the computerized case file if a noncustodial parent indicates willingness to pay up within 20 days after receiving a letter warning of impending enforcement.
"This is a statewide activity," and its success will depend on "the coordination and cooperation" of all child support staff and the Revenue Department, Osborne said.
