[Congressional Record Volume 140, Number 85 (Wednesday, June 29, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: June 29, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
   CREDIT BUREAU REPORTING OF COURT-ORDERED CHILD SUPPORT OBLIGATIONS

                                 ______


                          HON. SANDER M. LEVIN

                              of michigan

                    in the house of representatives

                        Wednesday, June 29, 1994

  Mr. LEVIN. Mr. Speaker, today, I am releasing this GAO report to 
emphasize the importance of parental responsibility when it comes to 
child support. All children are created by two people, and both of them 
must accept personal and financial responsibility.
  I have been a longtime supporter of the Child Support Enforcement 
Program, first enacted into law in 1975, and expanded by the Child-
Support Enforcement Amendments of 1984. In 1988, I worked actively on 
the Family Support Act, which, among other things, significantly 
strengthened efforts to expand and enforce the payment of court-ordered 
child support, including: Establishing mandatory wage withholding, 
requiring States to use State-developed guidelines to set child support 
awards, and requiring States to collect social security numbers from 
both parents at the time of a child's birth in the hospital, in order 
to establish paternity.
  Because of these past improvements, we are collecting increasing 
amounts of court-ordered child support. For every dollar we invest, we 
now collect $3.99 on average. But, despite this real success, large 
gaps remain.
  According to the Department of Health and Human Services publication, 
``Child Support Enforcement: Seventeenth Annual Report to Congress,'' 
of nearly $35 billion in cumulative court-ordered child support owed 
through 1992, $27 billion remained uncollected. In 1992, more than 5\1/
2\ million absentee parents made no child support payments at all.
  We have improved, Mr. Speaker, but we have to do better.
  Today, I am introducing legislation to require all States to 
participate in a simplified, nationally uniform child-support credit-
bureau reporting system. Credit bureaus, and through them, individual 
lenders, will know on a monthly basis whether parents owe court-ordered 
child support and whether or not they are fulfilling this most basic 
obligation.
  At my request, the GAO looked in depth at this weapon against 
negligent parents and, I am pleased to report, found it promising. Most 
States have tried or are now considering some form of credit bureau 
reporting. However, at this time, there is no nationally uniform 
reporting system in place.
  It is time, Mr. Speaker, to put our money where our mouth is. If we 
support family values, then surely this is a sensible and necessary 
step. Government, by itself, cannot combat delinquent parents--parents 
who willfully fail to support their children. Private sector banks, 
credit card agencies, merchants, and businesses should put court-
ordered child support on the scale when weighing the decision to make a 
loan.
  If we are to revisit the larger issue of welfare reform, we must also 
crack down on those parents who fail to make court-ordered child 
support payments. Unpaid child support--$5 billion in 1992 alone--
directly contributes to the impoverishment of children and rising 
welfare costs.
  A year ago, I received a letter from a constituent of mine in Warren, 
MI. This mother of two ran away from her husband, moved into a shelter 
for abused women and wrote, ``I have been working as a secretary for 
almost 8 years now, and it still seems that there is never enough 
money. My ex-husband doesn't even pay the ordered $55 per week, an 
amount so small it won't even buy them both new shoes or new coats. It 
won't pay for Little League registration * * * and if I saved every 
penny, it wouldn't put them even half way through college. Why does he 
do this?'' she asks. ``Because he feels he can get away with it and I'd 
say he's right,'' she adds.
  Unfortunately, this woman from Warren is not alone. In this case, the 
father does have the means to pay. If credit bureau reporting were 
mandatory, this parent's credit history would have reflected his child 
support delinquencies and may have put a dent in his ability to 
purchase the new cars and expensive home improvements his former wife 
says he now enjoys.
  Mr. Speaker, we need to send a clear, moral signal to parents: You 
must assume personal responsibility. There is a price to pay if you 
neglect your children.
  Government is doing what it can by intercepting tax refunds, 
garnishing wages, and putting liens on the property of those 
who consistently fail to support their children. But we also need the 
help of the private sector. I strongly believe that payment of child 
support is at least as important as other liabilities that lenders 
evaluate before extending credit. Like credit card balances, mortgages, 
auto loans and student loans, child support obligations must be noted. 
And failure to pay court-ordered support should carry the gravest 
consequences.

  This GAO report looks at 16 States, 11 of which do some form of 
reporting of delinquent child support payments to credit bureaus.
  The GAO finds that credit bureau reporting appears to have a positive 
effect on increasing collections and that startup and operational costs 
are nominal.
  In 1992-93, Washington State officials noted modest increases in 
child support collections within 2 to 4 months after the State notified 
parents that their child support delinquencies would be reported to 
credit bureaus.
  In 1989, California officials attributed a 12-percent increase in 
voluntary child collections in Fresno County to credit bureau 
reporting.
  In 1989, officials in Marion County, IN evaluated credit bureau 
reporting and found their child support collections increased by 16 
percent.
  It appears the main benefits of credit bureau reporting will show up 
over time as potential lenders deny credit to delinquent noncustodial 
parents. Greater public awareness should also stimulate an increase in 
collections.
  Mr. Speaker, we must send the message that both parents are 
responsible for supporting their children and that child support is a 
debt parents cannot afford to ignore.
  Mr. Speaker, I ask that a copy of the bill be inserted in the Record 
at this point.

                                H.R. --

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. MONTHLY REPORTING TO CERTAIN CONSUMER REPORTING 
                   AGENCIES OF CHILD SUPPORT OBLIGATIONS.

       (a) In General.--Section 466(a)(7) of the Social Security 
     Act (42 U.S.C. 666(a)(7)) is amended to read as follows:
       ``(7)(A)(i) Procedures which require the State agency to 
     provide to each qualified consumer reporting agency, on a 
     monthly basis, such information (and in such form and in such 
     manner) as the Secretary shall require by regulation with 
     respect to any child support obligation owed by an absent 
     parent to any person being provided services under the State 
     plan approved under this part, except that information with 
     respect to overdue support payable shall be made available 
     under such procedures only after--
       ``(I) the State agency has transmitted to the absent parent 
     notice that the information is to be so provided;
       ``(III) the absent parent has been given a reasonable 
     opportunity to contest the accuracy of the information; and
       ``(III) full compliance with all procedural due process 
     requirements of the State.
       ``(ii) Clause (i) shall not be construed to require the 
     provision of more than 1 notice to an absent parent with 
     respect to child support payable by the absent parent 
     pursuant to a child support order.
       ``(B) As used in subparagraph (A), the term `qualified 
     consumer reporting agency' means--
       ``(i) each consumer reporting agency (as defined in section 
     603(f) of the Fair Credit Reporting Act) that is a major 
     reporting agency (as determined by the Secretary in 
     regulations); and
       ``(ii) at the option of the State, any other consumer 
     reporting agency (as so defined).''.
       (b) Regulations.--Within 6 months after the date of the 
     enactment of this Act, the Secretary of Health and Human 
     Services shall prescribe such regulations as may be necessary 
     to carry out the amendment made by subsection (a).
       (c) Effective Date.--The amendment made by subsection (a) 
     shall take effect 12 months after the date of the enactment 
     of this Act.

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