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in
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SPONSOR |
Lujan, B |
DATE TYPED |
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HB |
470 |
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SHORT
TITLE |
Child Support Enforcement Changes |
SB |
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ANALYST |
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APPROPRIATION
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Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY04 |
FY05 |
FY04 |
FY05 |
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See Narrative |
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(Parenthesis
( ) Indicate Expenditure Decreases)
Relates to HB 392 and SB 48.
LFC Files
Responses Received From
Human Service Department (HSD)
Office of Attorney General (OAG)
Administrative Office of the Courts (AOC)
SUMMARY
Synopsis
of Bill
House Bill 470 is the “Enforcement Support Act”
and proposes to change the
Significant
Issues
The bill:
q
Reduces
the Interest Rate for Delinquent Child Support to 4%;
Changes the Statute of
Limitations for Paternity (no later than 12 years after the birth of a child);
q
Changes
the Statute of Limitations for Past Child Support Claims (12 years);
q
Establishes
an Arrears Management Program to provide amnesty for child support arrears.
Interest accrues on
delinquent child support at a rate in effect when the support payment becomes
due and shall accrue from the date the support is delinquent until the date the
support is paid or consolidated in a judgment.
The current interest rate is 8 ¾ %.
The
manner in which interest rates are calculated creates the following issues:
q
Creates a disincentive for any payment of
child support payments because the total amount (interest plus principal) is
difficult to pay-off.
q
The amount of interest owed usually is
the limiting factor in license revocation proceedings for return of the
license.
q
Calculation of interest (including
various interest rates) by Child Support Enforcement Division (CSED) is an
expensive and burdensome process in conjunction with the judicial proceedings
associated with child support.
HSD is given the power
to forgive the interest payment if it believes it is likely to result in the
collection of more child support. HSD is
also authorized to return suspended licenses to promote increased collection of
delinquent support. The proposed changes
will give HSD tools to work with parents that owe child support to collect
arrears or work-out payment options for non-custodial parents.
FISCAL IMPLICATIONS
The amount of interest
accrued during State Fiscal Year 2003 was:
The amount of interest
collected and distributed during State Fiscal Year 2003 was:
The Department should report through the interim
committee process the changes in collections in the upcoming year in order to
evaluate the effect of these changes.
ADMINISTRATIVE
IMPLICATIONS
There will be some
initial costs associated with the programming changes to the CSED computer
system (the Child Support Enforcement System-CSES). These are considered to be very negligible
compared to the savings in time for workers in calculating interest.
TECHNICAL ISSUES
HSD
states that the language for the statute of limitations in HB470 improperly
removes the provision in Section 40-11-23 B NMSA 1978, which is the default
method of a establishing a judgment complying with the statute of
limitations. Additionally, the term
“good cause” is a relatively easy threshold to achieve and is not as
restrictive as the HSD proposed language: “The court shall order
child support retroactive to the date of the child's birth, but not to exceed
more than 12 years, unless there is a substantial showing that paternity could
not have been established within 12 years from the birth of the child.”
Observations
of the AG are:
q The provision of HB 470
(p. 3, lines 3-4) that provides that the department has the ability to
authorize the return of suspended licenses may conflict with the Parental
Responsibility Act, § 40-5A-6.
q It is not clear whether
changes to §§ 40-5A-4, 40-5A-5, and 40-5A-6 (p. 3, lines 13-15 and 17-19; p. 4,
lines 14-16 and 18-20; and p.5, lines 13-14) are intended to be style changes
or substantive changes.
"Compliance" as defined under § 40-5A-3 (D) expressly applies
only to an "obligor", who is defined under § 40-5A-3 (I) to mean a
"person who has been ordered to pay ... support pursuant to a judgment and
order for support." The effect of
the proposed changes referenced above means that the substantive provisions of
the Parental Responsibility Act relating to license applications and renewals
do not apply unless the person has been ordered to pay support pursuant to a
judgment and order. For example, an
applicant or licensee who is under a contempt order for failure to respond to a
subpoena in a paternity action or who is under a warrant for failure to answer
the contempt order in a paternity action would not be subject to the substantive
provisions of the Act unless the person is out of compliance with a judgment
and order for support. To clarify the
intent of the proposed changes, replace the nouns "person" (p. 3,
line 11) and "licensee" (p. 4, line 12) to "obligor."
q The proposed amendment to the §40-4-7.3 (F)
(p. 3, lines 5-7) refers to implementation of the Support Enforcement Act. It may be better to locate this provision
under the Support Enforcement Act, §§ 40-4A-1 through 40-4A-19.
q References to §
AMENDMENTS
NEW SECTION
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
NEW SECTION
27-2-27. Single state agency; powers and duties.
The department is designated as the single state agency for
the enforcement of child and spousal support obligations pursuant to Title IV D
of the federal act with the following duties and powers:
A. establish the paternity of a child in the case of the
child born out of wedlock with respect to whom an assignment of support rights
has been executed in favor of the department;
B. establish an order of support for children receiving aid
to families with dependent children and, at the option of the department, for the
spouse or former spouse with whom such children are living, but only if a
support obligation has been established with respect to such spouse or former
spouse, for whom no order of support presently exists and seek modification,
based upon the noncustodial parent's ability to pay, of existing orders in
which the support order is inadequate to properly care for the child and the
spouse or former spouse with whom the child is living;
C. enforce as the real party in interest any existing order
for the support of children who are receiving aid to families with dependent
children or of the spouse or former spouse with whom such children are living;
and
D. provide services to non-aid families with dependent
children in the establishment and enforcement of paternity and child support
obligations, including locating the absent parent. For these services, the
department is authorized to establish and collect fees, costs and charges
permitted or required by federal law or by regulations adopted pursuant to that
federal law.
E. In all cases handled by the department pursuant to the
provisions of this section, the child support enforcement division of the
department and any attorney employed by the division shall represent the
department , to the exclusion of any other party, in establishing,
modifying and enforcing support obligations. An attorney employed to provide
Title IV-D services represents the interests of the state and not the interests
of any other party. The provision of services by an attorney under this chapter
does not create an attorney-client relationship between the attorney and any
other party. The department shall, at the time an application for child support
services is made, inform the applicant that neither the Title IV-D agency nor
any attorney who provides services under this chapter is the applicant's
attorney and that the attorney providing services under this chapter does not
provide legal representation to the applicant. The department shall not
prosecute or defend any ancillary matters such as custody, visitation or
property division raised in such proceedings. The department may petition for
modification of child support or medical support for children.
F.
The department may initiate an action or may intervene in an action involving child
support. Intervention by the department in an existing action is by
unconditional right and is accomplished by the department filing an entry of
appearance.
G. An attorney employed by
the department or as otherwise provided by this chapter may not be
appointed or act as a guardian ad litem for a child or another party.
H. The provision of services by the department under this
chapter or Part D of Title IV of the federal Social Security Act ( 42 U.S.C.
Section 651, et seq.) does not authorize service on the department of any legal
notice, document or pleading that is required to be served on any other party
other than the agency.
I. A court shall not
disqualify the department in a legal action filed under this chapter or Part D
of Title IV of the federal Social Security Act (42 U.S.C. Section 651, et seq.)
on the basis that the agency has previously provided services to a party whose
interests may now be adverse to the relief requested.
AMENDING SECTION 40-11-15 (C) NMSA 1978 (BEING
LAWS 1974, CHAPTER 40, ARTICLE 11, SECTION 15(C), AS AMENDED) RELATING TO
JUDGMENT OR ORDER
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
AMENDED Section 15 (C) NMSA 1978
(being Laws 1974, Chapter 40, Article 11, Section 15(C)1,asamended)
C. The judgment or order may contain any other
provision directed against or on behalf of the appropriate party to the
proceeding concerning the duty of past and future support, the custody and
guardianship of the child, visitation with the child, the furnishing of bond or
other security for the payment of the judgment or any other matter within the
jurisdiction of the court. The judgment or order may direct the father to pay
the reasonable expenses of the mother's pregnancy, birth and confinement. The court shall order child support
retroactive to the date of the child's birth, but not to exceed more than 12
years, unless there is a substantial showing that paternity could not have been
established within 12 years from the birth of the child, pursuant to the
provisions of Sections 40-4-11 through 40-4-11.3 NMSA 1978; provided that, in
deciding whether or how long to order retroactive support, the court shall
consider:
(1) whether the alleged or presumed
father has absconded or could not be located; and
(2) whether equitable defenses are
applicable.
NEW SECTION 40-4A-19 NMSA 1978 RELATING CHILD
SUPPORT ENFORCEMENT – ARREARS MANAGEMENT PROGRAM
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
NEW SECTION 40-4A-20 NMSA 1978:
The human services department is authorized to
conduct an “arrears management program” (amnesty program) for child support
arrears, pursuant to procedures adopted by the department, starting on or after
BD/dm