[Congressional Record Volume 144, Number 140 (Thursday, October 8, 1998)]
[Senate]
[Pages S11981-S11982]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KOHL:
  S. 2586. A bill to amend parts A and D of title IV of the Social 
Security Act to require States to pass through directly to a family 
receiving assistance under the temporary assistance to needy families 
program all child support collected by the State and to disregard any 
child support that the family receives in determining the family's 
level of assistance under that program; to the Committee on Finance.


            Children First Child Support Reform Act of 1998

  Mr. KOHL. Mr. President, today I introduce legislation to put 
America's children first by putting more resources into the hands of 
families and encouraging more parents to live up to their child support 
obligations. My legislation, the Children First Child Support Reform 
Act, would direct that all child support collected through the Federal-
State Child Support Enforcement Program be passed through, or paid, 
directly to the children and families to whom it is owed and 
disregarded in the calculation of public assistance benefits. My 
legislation will assure non-custodial parents that the child support 
they pay will actually contribute to the well-being of their child, 
rather than the government, and will also reduce administrative burdens 
on the state.
  As my colleagues know, since its inception in 1975, our Federal-State 
Child Support Enforcement Program has been tasked with collecting child 
support for families receiving public assistance and other families 
that request help in enforcing child support. Towards this end, the 
program works to establish paternity and legally-binding support 
orders, while collecting and disbursing funds on behalf of families so 
that children receive the support they need to grow up in healthy, 
nurturing surroundings.
  But on one crucial point, the current program does not truly work on 
behalf of families and, perhaps more importantly, may actually work 
against families by discouraging non-custodial parents from meeting 
their child support obligations.
  If the family was never on public assistance, the support is 
collected by the Child Support Enforcement Program and sent directly to 
the family. However, under current law, most child support collected on 
behalf of families receiving public assistance is retained by the state 
and Federal governments as reimbursement for welfare expenditures. In 
addition to this cost recoupment function, collections made on behalf 
of welfare families are used to fund the child support program in many 
states.
  Thus, under current law, we have a system where the vast majority of 
children on public assistance never actually receive the child support 
that is paid on their behalf. The government keeps the money. The 
research shows that many non-custodial parents who pay support do not 
believe that their payment actually benefits their children. They 
realize and resent that they are paying the government. Worse yet, some 
non-custodial parents may decide not to pay support because it does not 
go to their children. Some custodial parents also are skeptical about 
working with the child support agency to secure payments since the 
funds are generally not forwarded to them.
  Mr. President, we know that an estimated 800,000 families would not 
need public assistance if they could count on the child support owed to 
them. In addition, we know that 23 million children are owed more than 
$40 billion in outstanding support. Clearly, the vital importance of 
child support in keeping families off of assistance remains as true 
today as when the program began. In a world with TANF time limits, it 
has never been more important. And with these figures in mind, it is 
not unthinkable that some policymakers may have or might still consider 
this program as a means of recovering welfare expenditures.
  But I am convinced that that thinking must change, if not cast off 
entirely, because, simply put, times have changed. The welfare reform 
law of 1996, which I supported, paved the way for time limits and work 
requirements that provide clear and compelling incentives for families 
to enter the workforce and find a way to stay there. Open ended, 
unconditional public support is no longer a reality, and our goal and 
responsibility as policymakers, now more than ever before, is to give 
families the tools and resources they need to prepare for and 
ultimately survive the day when they are without public assistance.
  We fundamentally changed welfare, now we must fundamentally reexamine 
the central role of child support in helping families as they struggle 
to become and remain self-sufficient. And I say we go down the road of 
putting children first, a path on which we have already made some 
progress. Under the welfare reform law, states will eventually be 
required to distribute state-collected child support arrears owed to 
the family before paying off arrears owed to the state and Federal 
governments for welfare expenditures. In addition, states were given 
the option of continuing to passthrough directly the first $50 of child 
support to the family.
  One state, my state of Wisconsin, has opted to pass through all child 
support collected on behalf of participating families to those 
families. As you know, Wisconsin has been a leader and national model 
in the area of welfare reform. Under Wisconsin's welfare program, child 
support counts as income in determining financial eligibility for 
welfare assistance, but once eligibility is established, the child 
support income is disregarded in calculating program benefits. In other 
words, families are allowed to keep their own money. Non-custodial 
parents can be assured that their contribution counts and that their 
child support payments go to their children. And both parents are

[[Page S11982]]

presented with a realistic picture of what that support means in the 
life of their child. I believe we, as a nation, should follow 
Wisconsin's example.
  The full passthrough and disregard approach also has significant 
benefits on the administrative side. The current distribution 
requirements place significant computer, accounting and paperwork 
burdens on the states. They are also costly. Data from the Federal 
Office of Child Support demonstrates that nearly 20 percent of program 
expenditures are spent simply processing payments. States are required 
to maintain a complicated set of accounts to determine whether support 
collected should be paid to the family or kept by the government. These 
complex accounting rules depend on whether the family ever received 
public assistance, the date a family begins and ends assistance, 
whether the non-custodial parent is current on payments or owes 
arrears, the method of collection and other factors.
  We know that we have already asked much of the states in the realm of 
automation, systems integration and welfare law child support 
enforcement adjustments. We hope and believe these improvements will 
lead to better collection rates. Now we have a chance to simplify and 
improve distribution of support. What could be simpler than a 
distribution system in which all child support collected would be 
delivered to the children to whom it is owed? A distribution system in 
which child support agencies would distribute current support and 
arrears to both welfare and non-welfare families in exactly the same 
way?
  Mr. President, I am raising these points and introducing this 
legislation today, in the final week of the 105th Congress, as a 
marker, as a starting point to this discussion. Child support financing 
must be addressed. First, our current distribution scheme is out of 
step with the philosophy of current welfare policy. We must move the 
child support program from cost-recovery to service delivery for all 
families. Second, the current financing scheme is no longer workable. 
TANF caseloads are decreasing dramatically, even as overall child 
support caseloads are increasing. Therefore, while the system needs 
additional resources, the portion of the caseload that produces those 
resources is decreasing. We must put the child support program on a 
sound financial footing that confirms a strong Federal and state 
commitment to the program.
  So, I believe it is time to begin a discussion on the issue of child 
support financing and the vital role of the child support program in 
helping families help themselves. The Administration has already begun 
to meet with policymakers, state administrators, and children's 
advocates to discuss the future of child support financing. I want to 
begin today, and ultimately end the debate, by pushing for a financing 
system that puts more resources into the hands of children, that lets 
our nation's families keep more of their own money.
  But let me strongly affirm that adopting a children first policy is 
only one of my goals. At this time, my proposal addresses only one half 
of the financing issue. Yes, we should put children first, but let me 
stress that I have every intention of continuing to refine this 
proposal so that it addresses the second point as well--finding 
alternative financing mechanisms so that states can maintain and 
strengthen their child support programs. Without adequate funding, 
state child support programs cannot deliver effective child support 
services to the families that so desperately need them. I want to 
continue working with my colleagues, Wisconsin and the other states, 
advocates and families to sort out the rest of the financing question. 
By advocating a full passthrough and disregard approach, I am 
absolutely not advocating a disinvestment in our child support system 
by either the Federal government or the states. Our commitment to this 
program must remain strong and steadfast.
  But it is time for us to create a system that truly serves families 
by giving them the tools to survive in a world without public support. 
It is time for a child support financing system that truly puts 
families, and not the government, first.
  Mr. President, I ask unanimous consent that the full text 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. 2586

       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 ``Children First Child Support 
     Reform Act of 1998''.

     SEC. 2. DISTRIBUTION AND TREATMENT OF CHILD SUPPORT COLLECTED 
                   BY OR ON BEHALF OF FAMILIES RECEIVING 
                   ASSISTANCE UNDER TANF.

       (a) Requirement to Pass All Child Support Collected 
     Directly to the Family.--
       (1) In general.--Section 457 of the Social Security Act (42 
     U.S.C. 657) is amended--
       (A) by striking all that precedes subsection (f) and 
     inserting the following:

     ``SEC. 457. DISTRIBUTION OF COLLECTED SUPPORT.

       ``(a) Distribution to Family.--
       ``(1) In General.--Subject to paragraph (2) and subsection 
     (f), any amount collected on behalf of a family as support by 
     a State pursuant to a plan approved under this part shall be 
     distributed to the family.
       ``(2) Families under certain agreements.--In the case of an 
     amount collected for a family in accordance with a 
     cooperative agreement under section 454(33), the State shall 
     distribute the amount so collected pursuant to the terms of 
     the agreement.
       ``(b) Hold Harmless Provision.--If the amounts collected 
     which could be retained by the State in the fiscal year (to 
     the extent necessary to reimburse the State for amounts paid 
     to families as assistance by the State) are less than the 
     State share of the amounts collected in fiscal year 1995, the 
     State share for the fiscal year shall be an amount equal to 
     the State share in fiscal year 1995.'';
       (B) by redesignating subsection (f) as subsection (c); and
       (C) in subsection (c) (as so redesignated), by striking 
     ``Notwithstanding'' and inserting ``Amounts Collected On 
     Behalf of Children in Foster Care.--Notwithstanding''.
       (2) Conforming amendments.--
       (A) Section 409(a)(7)(B)(i)(I))(aa) of the Social Security 
     Act (42 U.S.C. 609(a)(7)(B)(i)(I)(aa)) is amended by striking 
     ``457(a)(1)(B)'' and inserting ``457''.
       (B) Section 454B(c) of such Act (42 U.S.C. 654b(c)) is 
     amended by striking ``457(a)'' and inserting ``457''.
       (b) Disregard of Child Support Collected For Purposes of 
     Determining Amount of TANF Assistance.--Section 408(a) of the 
     Social Security Act (42 U.S.C. 608(a)) is amended by adding 
     at the end the following:
       ``(12) Requirement to disregard child support in 
     determining amount of assistance.--
       ``(A) In general.--A State to which a grant is made under 
     section 403 shall disregard any amount received by a family 
     as a result of a child support obligation in determining the 
     amount or level of assistance that the State will provide to 
     the family under the State program funded under this part.
       ``(B) Option to include child support for purposes of 
     determining eligibility.--A State may include any amount 
     received by a family as a result of a child support 
     obligation in determining the family's income for purposes of 
     determining the family's eligibility for assistance under the 
     State program funded under this part.''.
       (c) Elimination of TANF Requirement to Assign Support to 
     the State.--
       (1) In general.--Section 408(a) of the Social Security Act 
     (42 U.S.C. 608(a)) is amended by striking paragraph (3).
       (2) Conforming amendments.--
       (A) Section 452 of the Social Security Act (42 U.S.C. 652) 
     is amended--
       (i) in subsection (a)(10)(C), by striking ``section 
     408(a)(3) or under''; and
       (ii) in subsection (h), by striking ``or with respect to 
     whom an assignment pursuant to section 408(a)(3) is in 
     effect''.
       (B) Section 454(5) of such Act (42 U.S.C. 654(5)) is 
     amended by striking ``(A) in any case'' and all that follows 
     through ``the support payments collected, and (B)''.
       (C) Section 456(a) of such Act (42 U.S.C. 656(a)) is 
     amended--
       (i) in paragraph (1), by striking ``assigned to the State 
     pursuant to section 408(a)(3) or''; and
       (ii) in paragraph (2)(A), by striking ``assigned''.
       (D) Section 464(a)(1) of such Act (42 U.S.C. 654(a)(1)) is 
     amended by striking ``section 408(a)(3) or ''.
       (E) Section 466(a)(3)(B) of such Act (42 U.S.C. 
     666(a)(3)(B)) is amended by striking ``408(a)(3) or ''.
       (F) Section 458A(b)(5)(C)(i)(I) of the Social Security Act 
     (42 U.S.C. 658a(b)(5)(C)(i)(I)), as added by the Child 
     Support Performance and Incentive Act of 1998 (Public Law 
     105-200; 112 Stat. 645) is amended by striking ``A or''.
       (d) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section take effect on October 1, 
     1998.
       (2) Child support performance and incentive act conforming 
     amendment.--The amendment made by subsection (c)(2)(F) shall 
     take effect on October 2, 1999.
                                 ______