[Congressional Record Volume 144, Number 30 (Wednesday, March 18, 1998)]
[Senate]
[Pages S2214-S2215]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN:
  S. 1791. A bill to provide for an alternative penalty procedure for 
States that fail to meet Federal child support data processing 
requirements; to the Committee on Finance.


               the child support performance act of 1998

  Mrs. FEINSTEIN. Mr. President, I am introducing today the Child 
Support Performance Act of 1998. This legislation decreases penalties 
for those 14 states who did not make the child support enforcement 
system deadline last October.

  This legislation decreases the overall penalties to 4% of the child 
support administrative funds in the first year, and increases the 
penalties by 4% each year up to 20%. However, if the state meets the 
benchmark goals it set out with HHS at the beginning of the year, 75% 
of the penalties would be forgiven each year. This provision encourages 
states to set realistic goals for the year and recognizes their 
progress each year instead of the all or nothing approach under current 
law.
  The current penalties for not having the child support enforcement 
system up and running are enormous. States would be penalized all their 
TANF (AFDC) funding and their child support administration funds for 
the year.
  The total loss in TANF funds and child support administrative funds 
from the 14 states amount to over $8 billion per year. More 
specifically, California would lose $4 billion. Illinois would lose 
$654 million. Michigan would lose $857 million. Pennsylvania would lose 
$794 million.
  There is enough blame to go around for the states' failures to meet 
the child support enforcement systems deadline.
  The lengthy private sector contractor procurement and federal 
approval processes; many vendors' inability to complete work to 
specifications within the time allowed; the long time needed to convert 
large caseloads into a new system; the difficulties inherent in a 
single system conversion in large states like California.
  All of us would agree that the huge financial penalties imposed on 14 
or more states would cause hardship to the children and families in the 
affected states. However, since over 30% of all child support cases are 
interstate collection cases, the penalties would have a nationwide 
impact.
  What this means is that children in Kansas or Georgia will not be 
able to get child support from parents in California, Pennsylvania or 
the other 12 states who face the devastating penalties.
  For the 14 states who face such devastating prospects, without my 
legislation, the rigid one statewide system requirement and the harsh 
penalty imposed on states would impoverish 19 million families with 
children nationwide.
  Let me also point out the unfairness of current penalties on Los 
Angeles County. For California, 25% of the penalty will be borne by LA 
County, the largest county in the nation, serving 550,000 families. 
Despite the fact that LA County completed its system by the October 
deadline and could be certified as recognized by HHS in its March 2, 
1998 proposed rules, LA County will be penalized along with the rest of 
California.
  This is unfair and wrong. As I propose in my legislation, when 
counties have met the system requirement by building their own system 
with separate HHS funding, their portion should be exempted from the 
total penalties imposed on a state.
  The House of Representatives recently passed Clay Shaw's legislation, 
H.R. 3130, that lowered the penalties for those states who did not meet 
the October 1st deadline last year. Representative Shaw's bill lowers 
the penalties but remains very harsh for those states who missed the 
deadline but who are on their way to becoming certified within a year 
or two.
  Under Shaw's bill, California alone would face $12 million in penalty 
in the first year and up to $60 million in the forth year, denying 2.36 
million impoverished families in California of their child support. It 
will not hurt the state, but only those families we are trying to help.
  In other big states like Illinois, approximate 730,000 families with 
children may not get their child support because the state faces $2.7 
million in penalties during the first year, and up to $13.5 million in 
the fourth year.
  For Michigan, 1.5 million families with children may not get their 
child support because the state faces $3.27 million in penalties during 
the first year, up to $16.3 million in the fourth year.
  Some, argue that these cuts are necessary to punish the states for 
not coming into compliance, but the reality is, that again only hurts 
the families with children.
  Mr. President, the bottom line is, if we don't have child support 
enforcement systems up and running, children and families don't get 
their child support. 14 states do not have a child support enforcement 
system and imposing harsh penalties will not encourage states to 
perform better but debilitate their ability to serve.
  Thank you, Mr. President. I urge all the members to support this 
legislation and I ask unanimous consent that a copy of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1791

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Support Performance 
     Act of 1998''.

[[Page S2215]]

     SEC. 2. ALTERNATIVE PENALTY PROCEDURE APPLICABLE TO FEDERAL 
                   CHILD SUPPORT DATA PROCESSING REQUIREMENTS.

       (a) In General.--Section 455(a) of the Social Security Act 
     (42 U.S.C. 655(a)) is amended by adding at the end the 
     following:
       ``(4)(A) If--
       ``(i) the Secretary determines that a State plan under 
     section 454 would (in the absence of this paragraph) be 
     disapproved for the failure of the State to comply with 
     section 454(24)(A), and that the State has made and is 
     continuing to make a good faith effort to so comply; and
       ``(ii) the State has submitted to the Secretary a 
     corrective compliance plan that describes how the State will 
     achieve such compliance, which has been approved by the 
     Secretary,

     then the Secretary shall not disapprove the State plan under 
     section 454, and the Secretary shall reduce the amount 
     otherwise payable to the State under paragraph (1)(A) of this 
     subsection for the fiscal year by the penalty amount.
       ``(B) In this paragraph:
       ``(i) The term `penalty amount' means, with respect to a 
     failure of a State to comply with section 454(24)--
       ``(I) 4 percent of the penalty base, in the case of the 1st 
     fiscal year in which such a failure by the State occurs;
       ``(II) 8 percent of the penalty base, in the case of the 
     2nd such fiscal year;
       ``(III) 12 percent of the penalty base, in the case of the 
     3rd such fiscal year;
       ``(IV) 16 percent of the penalty base, in the case of the 
     4th such fiscal year; or
       ``(V) 20 percent of the penalty base, in the case of the 
     5th or any subsequent such fiscal year.
       ``(ii) The term `penalty base' means, with respect to a 
     failure of a State to comply with section 454(24) during a 
     fiscal year, the amount otherwise payable to the State under 
     paragraph (1)(A) of this subsection for the preceding fiscal 
     year, minus the applicable share of such amount which would 
     otherwise be payable to any county to which the Secretary 
     granted a waiver under the Family Support Act of 1988 (Public 
     Law 100-485; 102 Stat. 2343) for 90 percent enhanced Federal 
     funding to develop an automated data processing and 
     information retrieval system provided that such system was 
     implemented prior to October 1, 1997.
       ``(C)(i) The Secretary shall waive a penalty under this 
     paragraph for any failure of a State to comply with section 
     454(24)(A) during fiscal year 1998 if, by December 31, 1997, 
     the State has submitted to the Secretary a request that the 
     Secretary certify the State as having met the requirements of 
     such section and, by June 1, 1998, the Secretary has provided 
     the certification as a result of a review conducted pursuant 
     to the request.
       ``(ii) If a State with respect to which a reduction is made 
     under this paragraph for a fiscal year achieves compliance 
     with the milestones in the corrective compliance plan for 
     that year by the beginning of the succeeding fiscal year, the 
     Secretary shall increase the amount otherwise payable to the 
     State under paragraph (1)(A) of this subsection for the 
     succeeding fiscal year by an amount equal to 75 percent of 
     the reduction for the fiscal year.
       ``(iii) The Secretary shall reduce the amount of any 
     reduction that, in the absence of this clause, would be 
     required to be made under this paragraph by reason of the 
     failure of a State to achieve compliance with section 
     454(24)(B) during the fiscal year, by an amount equal to 20 
     percent of the amount of the otherwise required reduction, 
     for each State performance measure described in section 
     458A(b)(4) with respect to which the applicable percentage 
     under section 458A(b)(6) for the fiscal year is 100 percent, 
     if the Secretary has made the determination described in 
     section 458A(b)(5)(B) with respect to the State for the 
     fiscal year.
       ``(D)(i) Subject to clause (ii), the preceding provisions 
     of this paragraph (except for subparagraph (C)(i)) shall 
     apply, separately and independently, to a failure to comply 
     with section 454(24)(B) in the same manner in which the 
     preceding provisions apply to a failure to comply with 
     section 454(24)(A).
       ``(ii) The requirement under clause (i) to impose a 
     separate and independent penalty amount for a fiscal year for 
     a failure to comply with section 454(24)(B) shall not apply 
     in the case of any State that the Secretary determines has 
     achieved, by such date as the Secretary may specify, 
     compliance with the milestones of the corrective compliance 
     plan submitted by the State that the Secretary determines are 
     necessary for the State to progress toward certification 
     under section 454(24)(B).''.
       (b) Inapplicability of Penalty Under TANF Program.--Section 
     409(a)(8)(A)(i)(III) of such Act (42 U.S.C. 
     609(a)(8)(A)(i)(III)) is amended by inserting ``(other than 
     section 454(24))'' before the semicolon.

     SEC. 3. AUTHORITY TO WAIVE SINGLE STATEWIDE AUTOMATED DATA 
                   PROCESSING AND INFORMATION RETRIEVAL SYSTEM 
                   REQUIREMENT.

       (a) In General.--Section 452(d)(3) of the Social Security 
     Act (42 U.S.C. 652(d)(3)) is amended to read as follows:
       ``(3) The Secretary may waive any requirement of paragraph 
     (1) or any condition specified under section 454(16), and 
     shall waive the single statewide system requirement under 
     sections 454(16) and 454A, with respect to a State if--
       ``(A) the State demonstrates to the satisfaction of the 
     Secretary that the State has or can develop an alternative 
     system or systems that enable the State--
       ``(i) for purposes of section 409(a)(8), to achieve the 
     paternity establishment percentages (as defined in section 
     452(g)(2)) and other performance measures that may be 
     established by the Secretary;
       ``(ii) to submit data under section 454(15)(B) that is 
     complete and reliable;
       ``(iii) to substantially comply with the requirements of 
     this part; and
       ``(iv) in the case of a request to waive the single 
     statewide system requirement, to--

       ``(I) meet all functional requirements of sections 454(16) 
     and 454A;
       ``(II) ensure that the calculation of distribution of 
     collected support is according to the requirements of section 
     457;
       ``(III) ensure that there is only 1 point of contact in the 
     State for all interstate case processing and coordinated 
     intrastate case management;
       ``(IV) ensure that standardized data elements, forms, and 
     definitions are used throughout the State; and
       ``(V) complete the alternative system in no more time than 
     it would take to complete a single statewide system that 
     meets such requirement;

       ``(B)(i) the waiver meets the criteria of paragraphs (1), 
     (2), and (3) of section 1115(c); or
       ``(ii) the State provides assurances to the Secretary that 
     steps will be taken to otherwise improve the State's child 
     support enforcement program; and
       ``(C) in the case of a request to waive the single 
     statewide system requirement, the State has submitted to the 
     Secretary separate estimates of the total cost of a single 
     statewide system that meets such requirement, and of any such 
     alternative system or systems, which shall include estimates 
     of the cost of developing and completing the system and of 
     operating the system for 5 years, and the Secretary has 
     agreed with the estimates.''.
       (b) Payments to States.--Section 455(a)(1) of such Act (42 
     U.S.C. 655(a)(1)) is amended--
       (1) by striking ``and'' at the end of subparagraph (B);
       (2) by striking the semicolon at the end of subparagraph 
     (C) and inserting ``, and''; and
       (3) by inserting after subparagraph (C) the following:
       ``(D) equal to 66 percent of the sums expended by the State 
     during the quarter for an alternative statewide system for 
     which a waiver has been granted under section 452(d)(3), but 
     only to the extent that the total of the sums so expended by 
     the State on or after the date of the enactment of this 
     subparagraph does not exceed the least total cost estimate 
     submitted by the State pursuant to section 452(d)(3)(C) in 
     the request for the waiver.''.
                                 ______