[Federal Register Volume 65, Number 162 (Monday, August 21, 2000)]
[Proposed Rules]
[Pages 50800-50839]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-20798]



  Federal Register / Vol. 65, No. 162 / Monday, August 21, 2000 / 
Proposed Rules  

[[Page 50800]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of Child Support Enforcement

45 CFR Part 309

RIN 0970-AB73


Tribal Child Support Enforcement Programs

AGENCY: Office of Child Support Enforcement (OCSE), Administration for 
Children and Families, HHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Administration for Children and Families (ACF) is issuing 
this notice of proposed rulemaking (NPRM) to implement direct funding 
to Indian Tribes and Tribal organizations under section 455(f) of the 
Social Security Act (the Act) as added by the Personal Responsibility 
and Work Opportunity Reconciliation Act of 1996 (Public Law 104-193), 
and amended by section 5546 of the Balanced Budget Act of 1997 (Public 
Law 105-33). Section 455(f) of the Act authorizes direct funding of 
Tribal Child Support Enforcement (CSE) programs meeting requirements 
contained in the statute and established by the Secretary by 
regulation. These proposed regulations address these requirements and 
related provisions, provide guidance to Tribes and Tribal organizations 
on how to apply for and, upon approval, receive direct funding for the 
operation of Tribal CSE programs.
    A separate interim final rule for comprehensive Tribal CSE programs 
is published concurrently with this NPRM in this Federal Register. The 
interim final rule enables Tribes and Tribal organizations currently 
operating a comprehensive Tribal CSE program directly or through 
agreement, resolution, or contract, to apply for and receive direct 
Tribal CSE funding.

DATES: Consideration will be given to written comments received by 
December 19, 2000, and to comments made for the record at public 
consultations to be held by OCSE during the 120-day comment period.

ADDRESSES: Written comments should be submitted to the Office of Child 
Support Enforcement, Administration for Children and Families, 
Department of Health and Human Services, 370 L'Enfant Promenade, SW, 
Washington, DC 20447, Attention: Director, Division of Policy and 
Planning, Mail Stop: OCSE/DPP. Written comments also may be submitted 
at the OCSE public consultations to be held during the comment period.
    You may also transmit written comments electronically via the 
Internet. To transmit comments electronically, or download an 
electronic version of the rule, you should access the Administration 
for Children and Families Welfare Reform home page at ``http://
www.acf.dhhs.gov/hypernews/'' and follow any instructions provided. You 
may also submit comments by telefaxing to (202) 401-3444. This is not a 
toll-free number.
    Comments will be available for public inspection Monday through 
Friday, 8:30 a.m. to 5 p.m., on the 4th floor of the Department's 
offices at 370 L'Enfant Promenade, SW, Washington, DC 20447.

FOR FURTHER INFORMATION CONTACT: Tribal Child Support Enforcement 
Program, (202) 205-4554, or OCSE Division of Policy and Planning, (202) 
401-9386.
    Deaf and hearing-impaired individuals may call the Federal Dual 
Party Relay Service at 1-800-877-8339 from Monday through Friday 
between the hours of 8 a.m. and 7 p.m., Eastern Time.

SUPPLEMENTARY INFORMATION:

Comments on Proposed Rule

    Comments should be specific, address issues raised by the proposed 
rule, propose alternatives where appropriate, explain reasons for any 
objections or recommended changes, and reference the specific section 
of the proposed rule that is being addressed.
    We will not acknowledge receipt of the comments we receive. 
However, we will review and consider all comments that are germane and 
received during the comment period.
    In the interest of providing Tribes with adequate time to review 
and comment on this notice of proposed rulemaking, we modified the 
standard 60-day comment period and allow for 120 days. This is 
consistent with the extended 120-day comment period following the July 
22, 1998 publication of the Notice of Proposed Rulemaking for the 
Tribal Temporary Assistance for Needy Families Program (Tribal TANF) 
and Native Employment Works (NEW) Program (63 FR 39366).

Public Consultations

    To obtain the broadest public participation possible on these 
proposed rules, OCSE plans to conduct three public consultations during 
the comment period. These consultations also are intended to further 
solicit Tribal input on the Tribal Child Support Enforcement Program, 
as mandated by Presidential Executive Memoranda on April 29, 1994, and 
May 14, 1998.
    We plan to publish a separate notice with the specific locations, 
dates, and times of these consultations, and to mail notices to all 
Federally recognized Indian Tribes and State IV-D agencies. Further 
information regarding these consultations, including last-minute 
changes, will be available from the OCSE internet site (at 
``www.acf.dhhs.gov/programs/cse/''), and from OCSE's contractor for the 
consultations.
    At the consultations, Federal officials will explain and answer 
questions to clarify the proposed rules. Persons who attend the 
consultations may make oral presentations and/or provide written 
comments for the record at the consultations, at their option. They 
also may submit written comments to OCSE as explained earlier in this 
preamble, at their option. We encourage persons who make oral 
presentations at the consultations to submit written comments in 
support of their presentations.
    We encourage any person who wishes to make an oral presentation on 
these proposed rules at any of the consultations to preregister before 
or at the consultation. We will provide specific information on 
preregistration in the separate notice to be published on these 
consultations. At the time of preregistration, identifying information 
about prospective presenters will be recorded, such as name, 
organization (if any), address, and telephone number, so that 
presenters can be accurately identified and properly introduced at the 
consultations. Persons who preregistered will make their presentations 
first; then, as time allows, persons who did not preregister will make 
their presentations. Presentations must be about the proposed rule, 
should be specific, and should include specific recommendations for 
changes where appropriate. In fairness to other participants, 
presentations should be concise and will be limited to a maximum of 10 
minutes each. To clarify presentations, we may ask questions. 
Presentations will be recorded and included in the public record of 
comments on the proposed rules, unless a commenter does not want his or 
her comments to be on the record.
    At the consultations, we cannot address participants' concerns 
regarding the proposed rules, or respond to questions about the 
proposed rules other than questions asking for clarification. Instead, 
we will consider comments and recommendations provided at the 
consultations, and written comments and recommendations submitted as 
described earlier in this preamble, as we

[[Page 50801]]

prepare the final version of these regulations.

Statutory Authority

    These proposed regulations implement section 455(f) of the Social 
Security Act (the Act), as added by the Personal Responsibility and 
Work Opportunity Reconciliation Act (PRWORA; Pub. L. 104-193) and 
amended by section 5546 of the Balanced Budget Act of 1997 (Pub. L. 
105-33).
    This proposed regulation is also issued under the authority granted 
to the Secretary of Health and Human Services (Secretary) by section 
1102 of the Act, 42 U.S.C. 1302. Section 1102 of the Act authorizes the 
Secretary to publish regulations that may be necessary for the 
efficient administration of the functions for which the Secretary is 
responsible under the Act.
    Section 455(f) of the Act, as amended by Public Law 105-33, reads 
as follows: ``The Secretary may make direct payments under this part to 
an Indian tribe or tribal organization that demonstrates to the 
satisfaction of the Secretary that it has the capacity to operate a 
child support enforcement program meeting the objectives of this part, 
including establishment of paternity, establishment, modification, and 
enforcement of support orders, and location of absent parents. The 
Secretary shall promulgate regulations establishing the requirements 
which must be met by an Indian tribe or tribal organization to be 
eligible for a grant under this subsection.''

Public Law 102-477 and Public Law 93-638

    Public Law 102-477, the Indian Employment, Training and Related 
Services Demonstration Act of 1992, established a demonstration program 
under which Indian Tribes may integrate program services and 
consolidate administrative functions under Federally funded programs 
they administer for employment, job training, and related services. 
Child support enforcement is not an employment, job training, or 
related services program. Therefore, child support funds may not be 
included as part of a Tribal plan under Pubic Law 102-477, and Tribes 
must request child support funds directly from ACF.
    Public Law 93-638, the Indian Self-Determination and Education 
Assistance Act, authorizes self-determination contracts under which 
Indian Tribes may plan, conduct, and administer certain programs and 
services that are provided by the Federal government for the benefit of 
Indians because of their status as Indians. It also authorizes self-
governance compacts and funding agreements under which Tribes may plan, 
conduct, consolidate, and administer programs, services, and functions 
of the Department of the Interior and the Indian Health Service that 
are otherwise available to Indian Tribes or Indians. Child support 
enforcement is not among the programs and services that may be 
contracted or compacted pursuant to Public Law 93-638. Child support 
enforcement is not a program or service provided by the Federal 
government for Indians because of their status as Indians. Nor is it a 
program, service, or function of the Department of the Interior or the 
Indian Health Service.

Paperwork Reduction Act of 1995

    Under the Paperwork Reduction Act of 1995 (Public Law 104-13), all 
Departments are required to submit to the Office of Management and 
Budget (OMB) for review and approval any reporting or recordkeeping 
requirements inherent in a proposed or final rule. Interested parties 
may comment to OMB on these requirements as described below. This NPRM 
contains reporting requirements at proposed 45 CFR part 309, and the 
interim final rule for comprehensive Tribal CSE programs contains 
reporting requirements at 45 CFR part 310. The Department has submitted 
these reporting requirements to OMB for its review.
    Proposed part 309 and part 310 contain a regulatory requirement 
that, in order to receive funding for an independent Tribal CSE 
program, a Tribe or Tribal organization must submit an application 
containing standard forms 424 and 424A and a plan describing how the 
Tribe or Tribal organization meets or plans to meet the objectives of 
section 455(f) of the Act, including establishing paternity, 
establishing, modifying, and enforcing support orders, and locating 
noncustodial parents. Tribes and Tribal organizations must respond if 
they wish to operate a Federally funded program. In addition, any Tribe 
or Tribal organization participating in the program would be required 
to submit standard form 269 and form OCSE 34A and to submit statistical 
and narrative reports regarding its Tribal CSE program. The potential 
respondents to these information collection requirements are 
approximately 10 Federally recognized Tribes, and Tribal organizations, 
during Year 1; 65 additional Federally recognized Tribes and Tribal 
organizations during Year 2; and 75 additional Federally recognized 
Tribes and Tribal organizations during Year 3; for a three year total 
of 150 grantees. This information collection requirement will impose 
the estimated total annual burden on the Tribes and Tribal 
organizations described in the table below:

----------------------------------------------------------------------------------------------------------------
                                                    Number of     Responses per   Average burden   Total Annual
             Information collection                respondents      respondent     per response       Burden
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Year 1:
    SF 424.....................................              10               1             0.75            7.5
    SF 424A....................................              10               1             3              30
    SF 269.....................................              10               5             2             100
    45 CFR 309--Plan...........................              10               1           480           4,800
    Form OCSE 34A..............................              10               4             8             320
    Statistical Reporting......................              10               1            24             240
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        Total..................................  ..............  ...............  ..............        5,497.5
                                                ================================================================
Year 2:
    SF 424.....................................              75               1              .75           56.25
    SF 424A....................................              75               1             3             225
    SF 269.....................................              75               5             2             750
    45 CFR 309--Plan...........................              65               1           480          31,200
    Form OCSE 34A..............................              75               4             8           2,400

[[Page 50802]]

 
    Statistical Reporting......................              75               1            24           1,800
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        Total..................................  ..............  ...............  ..............       36,431.25
                                                ================================================================
Year 3:
    SF 424.....................................             150               1              .75          112.5
    SF 424A....................................             150               1             3             450
    SF 269.....................................             150               5             2           1,500
    45 CFR 309--Plan...........................              75               1           480          36,000
     Form OCSE 34A.............................             150               4             8           4,800
    Statistical Reporting......................             150               1            24           3,600
                                                ----------------------------------------------------------------
        Total..................................  ..............  ...............  ..............       46,462.5
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Total Burden for 3 Years: 88,391.25.
Total Annual Burden Averaged over 3 Years: 29,463.75 per year.

    The Administration for Children and Families will consider comments 
by the public on this proposed collection of information in the 
following areas:
     Evaluating whether the proposed collection is necessary 
for the proper performance of the functions of ACF, including whether 
the information will have practical utility;
     Evaluating the accuracy of ACF's estimate of the burden of 
the proposed collection of information, including the validity of the 
methodology and assumptions used;
     Enhancing the quality, usefulness, and clarity of the 
information to be collected; and
     Minimizing the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technology, e.g., 
permitting electronic submission of responses.
    OMB is required to make a decision concerning the collection of 
information contained in these regulations between 30 and 60 days after 
their publication in the Federal Register. Therefore, a comment is best 
assured of having its full effect if OMB receives it within 30 days of 
publication. This does not affect the deadline for the public to 
comment to the Department on the proposed regulations. Written comments 
to OMB for the proposed information collection should be sent directly 
to the following: Office of Management and Budget, Paperwork Reduction 
Project, 725 17th Street, NW, Washington DC 20503, Attn: Ms. Wendy 
Taylor, Desk Officer for ACF.

Regulatory Flexibility Analysis

    The Secretary certifies, under 5 U.S.C. 605(b), the Regulatory 
Flexibility Act (Pub. L. 96-354), that these regulations will not 
result in a significant impact on a substantial number of small 
entities because the primary impact of these regulations is on Tribal 
governments. Tribal governments are not considered small entities under 
the Act.

Executive Order 12866

    Executive Order 12866 requires that regulations be drafted to 
ensure that they are consistent with the priorities and principles set 
forth in the Executive Order. The Department has determined that this 
proposed rule is consistent with these priorities and principles. The 
proposed regulations are required by PRWORA and represent the proposed 
regulations governing direct funding to Tribal CSE agencies that 
demonstrate the capacity to operate a CSE program, including 
establishment of paternity, establishment, modification and enforcement 
of support orders, and location of noncustodial parents.
    The Executive Order encourages agencies, as appropriate, to provide 
the public with meaningful participation in the regulatory process. As 
described elsewhere in the preamble, ACF consulted with Tribes and 
Tribal organizations and their representatives to obtain their views 
prior to the publication of this NPRM.

Unfunded Mandates

    Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law 
104-4, (Unfunded Mandates Act) requires that a covered agency prepare a 
budgetary impact statement before promulgating a rule that includes a 
Federal mandate that may result in the expenditure by State, local and 
Tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any one year. If a covered agency must prepare a 
budgetary impact statement, section 205 further requires that it select 
the most cost-effective and least burdensome alternative that achieves 
the objectives of the rules and is consistent with the statutory 
requirements. In addition, section 203 requires a plan for informing 
and advising any small government that may be significantly or uniquely 
impacted by the proposed rule.
    We have determined that the proposed rule is not an economically 
significant rule and will not result in the expenditure by State, 
local, and Tribal governments, in the aggregate, or by the private 
sector, of more than $100 million in any one year. The following are 
estimated annual expenditures under the Tribal CSE Program: FY 2000-$0; 
FY 2001-$4.3 million; FY 2002-$17.6 million; FY 2003-$34.8 million; FY 
2004-$44.8 million; FY 2005-$49.2 million. Accordingly, we have not 
prepared a budgetary impact statement, specifically addressed the 
regulatory alternatives considered, or prepared a plan for informing 
and advising any significantly or uniquely impacted small government.

Congressional Review

    This proposed rule is not a major rule as defined in 5 U.S.C., 
Chapter 8.

Assessment of Federal Regulations and Policies on Families

    Section 654 of the Treasury and General Government Appropriations 
Act of 1999 requires Federal agencies to determine whether a proposed 
policy or regulation may affect family well-being. If the agency's 
conclusion is affirmative, then the agency must prepare an impact 
assessment addressing criteria specified in the law. We have determined 
that this proposed regulation may affect family well-being as defined 
in section 654 of the law and certify that we have made the required 
impact assessment. The purpose of the Tribal Child Support Enforcement 
Program is to strengthen the economic and social stability of families. 
This proposed rule gives flexibility to Tribes and Tribal

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organizations to design programs that serve this purpose. The rule will 
have a positive effect on family well-being. Implementation of Tribal 
CSE programs will result in increased child support enforcement 
services, including increased child support payments, for Tribal 
service populations. By helping to ensure that parents support their 
children, the rule will strengthen personal responsibility and increase 
disposable family income.

Executive Order 13132

    Executive Order 13132 on Federalism applies to policies that have 
federalism implications, defined as ``regulations, legislative comments 
or proposed legislation, and other policy statements or actions that 
have substantial direct effects on the States, on the relationship 
between the national government and the States, or on the distributions 
of power and responsibilities among the various levels of government.'' 
This rule does not have federalism implications for State or local 
governments as defined in the Executive Order.

Background

    The Child Support Enforcement Program was established in 1975 under 
title IV-D of the Social Security Act as a joint Federal/State 
partnership. The goal of the Child Support Enforcement Program (also 
known as the title IV-D program) is to ensure that both parents 
financially support their children. The IV-D program locates 
noncustodial parents, establishes paternity, establishes and enforces 
support orders, and collects child support payments from parents who 
are legally obligated to pay.
    The United States Constitution recognizes all treaties made under 
the authority of the United States, including treaties with Indian 
Tribes, as the ``supreme Law of the Land.'' The Constitution, Federal 
law, and court decisions establish Indian affairs as a unique area of 
Federal concern. The United States pledges in treaties to protect 
Indian Tribes, thereby establishing one of the bases for the Federal 
trust responsibility and the government-to-government relationship with 
Indian Tribes. These fundamental principles continue to guide national 
policy towards Indian Tribes. The Federal policy to support and 
strengthen Tribes' right to self-determination has been firmly 
established and reaffirmed by every U.S. President for more than thirty 
years.
    On April 29, 1994, at a historic meeting with the heads of Tribal 
governments, President Clinton reaffirmed the United States' ``unique 
legal relationship with Native American tribal governments as set forth 
in the Constitution of the United States, treaties, statutes, and court 
decisions'' and issued a memorandum to all executive departments and 
agencies of the Federal Government, stating that: ``As executive 
departments and agencies undertake activities affecting Native American 
tribal rights or trust resources, such activities should be implemented 
in a knowledgeable, sensitive manner respectful of tribal 
sovereignty.''
    The President's memorandum requires that in all activities relating 
to or affecting the government or treaty rights of Indian Tribes, the 
executive branch shall:
    (1) Operate within a government-to-government relationship with 
Federally recognized Indian Tribes;
    (2) Consult, to the greatest extent practicable and to the extent 
permitted by law, with Indian Tribal governments before taking actions 
that affect Federally recognized Indian Tribes;
    (3) Assess the impact of agency activities on Tribal trust 
resources and assure that Tribal interests are considered before the 
activities are undertaken;
    (4) Remove procedural impediments to working directly with Tribal 
governments on activities that affect trust property or governmental 
rights of the Tribes; and
    (5) Work cooperatively with other agencies to accomplish these 
goals established by the President.
    The Department and the Office of Child Support Enforcement are 
committed to carrying out the letter and spirit of this directive in 
the promulgation of regulations establishing the requirements which 
must be met by Tribes and Tribal organizations to be eligible for 
direct funding and in all dealings with Tribes.

Tribal Child Support Enforcement

    Prior to enactment of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996 (PRWORA), title IV-D of the Act 
placed authority to administer the delivery of IV-D services solely 
with the States. However, on most Indian reservations, the authority of 
State and local governments is limited or non-existent. The 
Constitution, numerous court decisions, and Federal law clearly reserve 
to Indian Tribes important powers of self-government, including the 
authority to make and enforce laws, to adjudicate civil and criminal 
disputes (including domestic relations cases), to tax, and to license. 
Consequently, States which have attempted to provide IV-D services on 
Tribal lands have generally been constrained in their abilities to 
establish paternity and establish and enforce child support orders. 
Cooperative agreements between Tribes and States have helped bring 
child support services to some reservations.
    Prior to enactment of PRWORA, Federal funding under title IV-D of 
the Act was limited to funding State child support enforcement programs 
and there was no direct Federal funding to Tribes for child support 
enforcement activities. Federal funding was available, through the 
State, for eligible expenditures of a Tribe pursuant to a cooperative 
agreement with the State, under which the State delegated functions of 
the IV-D program to the Tribal entity. The Tribal entity was required 
to comply with all aspects of title IV-D of the Act applicable to the 
function or functions delegated to the Tribe. Only under these 
circumstances was Federal reimbursement under title IV-D available to 
the State for costs incurred by the Tribal entity for performing IV-D 
functions.
    For the first time in the history of the program, PRWORA provided 
authority under title IV-D of the Act for direct funding of Tribes and 
Tribal organizations for operating child support enforcement programs. 
Section 455(f) of the Act provides, ``The Secretary may make direct 
payments under this part to an Indian tribe or tribal organization that 
demonstrates to the satisfaction of the Secretary that it has the 
capacity to operate a child support enforcement program meeting the 
objectives of this part, including establishment of paternity, 
establishment, modification, and enforcement of support orders, and 
location of absent parents. The Secretary shall promulgate regulations 
establishing the requirements which must be met by an Indian tribe or 
tribal organization to be eligible for a grant under this subsection.'' 
The Department of Health and Human Services (HHS) recognizes the unique 
relationship between the Federal Government and Federally recognized 
Indian Tribes and reflects this special government-to-government 
relationship in the implementation of the Tribal provisions of PRWORA. 
The direct Federal funding provisions provide Tribes with an 
opportunity to design their own child support programs to meet the 
needs of the Tribes' children and their families.
    Tribes may exercise their right to self-determination by deciding 
whether or not to operate a Tribal CSE program. Tribes which choose to 
administer a Tribal CSE program meeting the objectives of title IV-D of 
the Social Security Act will have considerable

[[Page 50804]]

flexibility to develop and administer programs consistent with Tribal 
laws and traditions. In this NPRM we have set forth regulations that 
allow for accommodation for unique Tribal situations in many 
circumstances. However, we believe there must be some degree of 
comparability among the Tribal and State IV-D programs in the 
nationwide child support enforcement program.
    Title IV-D gives the Secretary broad and exclusive authority to 
establish duties and responsibilities of Tribes and Tribal 
organizations in the operation of Tribal CSE programs and which meet 
the objectives of title IV-D. While section 455(f) particularly names 
establishment of paternity, establishment, modification and enforcement 
of support orders, and location of absent parents as objectives of 
title IV-D, this is a non-exclusive list. Title IV-D, as amended, was 
enacted by Congress ``for the purpose of enforcing the support 
obligations owed by noncustodial parents to their children * * * and 
assuring that assistance in obtaining support will be available under 
(IV-D) to all children (whether or not eligible for assistance for aid 
under part A) for whom such assistance is requested. * * *'' See S. 
Rep. No. 1356, 93rd Cong., 2d Sess. (1974) and S. Rep. No. 387, 98th 
Cong., 2d Sess. (1984). We interpret the purpose or objectives of title 
IV-D in a manner that includes Indian children in the class of 
individuals for whom assistance in obtaining support is available under 
the Act and believe that section 455(f) must be read in a manner that 
is consistent with this interpretation. Exercise of the Secretary's 
broad authority under title IV-D to establish duties and 
responsibilities of Tribes and Tribal organizations in the operation of 
Tribal CSE programs is an essential part of the coordinated Federal-
State-Tribal effort to ensure that absent parents support their 
children. Therefore, we believe that all IV-D programs must have in 
common a minimum set of fundamental characteristics to ensure that the 
objectives of title IV-D are implemented. This proposed rule sets forth 
the requirements that must be met in order for a Tribe or Tribal 
organization to receive direct funding for such IV-D programs.
    Alternatively, if a Tribal entity chooses not to undertake 
responsibility for operation of a IV-D program, section 454(33) of the 
Act provides that State IV-D agencies may negotiate cooperative 
agreements with a Tribe to ensure Tribal children and families receive 
much-needed support services. Under section 454(33) cooperative 
agreements, the funding relationship is between the State and the 
Federal government.
    As a result of PRWORA, title IV-D of the Act recognizes a number of 
ways in which IV-D services may be provided on Tribal lands:
     A State and Tribe or Tribal organization under a State IV-
D program provide for the cooperative delivery of child support 
enforcement services in Indian country pursuant to a cooperative 
agreement under section 454(33) of the Act.
     A State or local IV-D agency provides child support 
enforcement services on Tribal lands pursuant to an agreement under 
which the Tribe agrees to recognize the State or county jurisdiction on 
Tribal lands for the specific purpose of child support enforcement.
     A State provides child support enforcement services on 
Tribal lands because it has jurisdiction in Indian country that is 
lawfully exercised under Public Law 83-280. Since Public Law 83-280 
delegated Federal jurisdiction to some States, the jurisdiction of 
tribal courts remains concurrent with the States to the same extent 
that it was concurrent with the Federal government prior to enactment 
of the law. As a result of the Indian Civil Rights Act of 1968 (25 
U.S.C. 1301-03), a Tribe must consent to any additional assumptions of 
State Public Law 83-280 jurisdiction after enactment of this statute. 
To the extent that State jurisdiction is lawfully exercised within 
Indian country, such civil grant of authority is for adjudicatory 
jurisdiction only.
     A State and Tribe or Tribal organization under a State IV-
D program provide for the delivery of child support enforcement 
services in Indian country pursuant to a cooperative agreement in 
effect prior to August 22, 1996, the date of enactment of PRWORA.
     A Tribe or Tribal organization operates a child support 
enforcement program that meets the requirements for such a program 
established by the Secretary in regulations promulgated pursuant to 
section 455(f) of the Act.
    This regulation addresses only Tribal CSE program requirements for 
direct funding under section 455(f) of the Act.

Consultation Process

    The Administration for Children and Families and the Department of 
Health and Human Services are committed to consulting with Indian 
Tribes on a government-to-government basis. In compliance with the 
mandate to promulgate regulations for direct funding of Tribal CSE 
programs, in 1998 the Federal Office of Child Support Enforcement, 
Native American Program (OCSE-NAP), conducted a series of six Nation-
to-Nation consultations with Indian Tribes, Tribal organizations and 
other interested parties with the goal of obtaining Tribal input prior 
to publishing the NPRM for direct funding for Tribal CSE programs. In 
response to Tribal concerns, the consultations were conducted to obtain 
maximum Tribal input, as mandated by Presidential Executive Memoranda 
of April 29, 1994, and May 14, 1998, before proposed regulations were 
drafted.
    The consultations were designed to solicit Tribal input prior to 
the drafting of any Federal regulations for direct funding to Tribes 
and Tribal organizations to operate their own child support enforcement 
programs. The consultations were held across the country to allow for 
greater opportunity for Tribal participation. The consultation sites 
were Albuquerque, New Mexico; Portland, Oregon; Nashville, Tennessee; 
Fairbanks, Alaska; Washington, DC; and Prior Lake, Minnesota on the 
Shakopee Indian reservation. In addition, a toll free ``800'' number 
was created to allow for additional comments and input by Tribes and 
Tribal organizations. After the consultation process ended, OCSE 
solicited further input from individual participants from the previous 
consultations who had expressed an interest in helping OCSE to 
understand the issues raised during the consultation process.
    Each of the consultations lasted for 2\1/2\ days and comprised two 
distinct parts. The first part was an overview of the National Child 
Support Enforcement Program. This session was designed to provide 
participants with basic information about child support enforcement so 
that they would be better informed for the actual consultations. This 
portion of the consultation consisted largely of information sharing by 
Federal OCSE staff. It was designed for those new to the Tribal child 
support enforcement arena as well as those who needed additional 
background information about paternity establishment and child support 
enforcement. In addition, this first portion of the consultation 
doubled as informal training for Tribal child support enforcement 
staff.
    The second and longer part of the consultation was devoted to 
Federal staff listening to Tribal input regarding the regulations. OCSE 
used neutral Native American facilitators to help focus the discussion, 
to leave Federal officials free to listen, and to help draw input and 
questions from all participants.

[[Page 50805]]

    In order to effectively coordinate the six consultations and obtain 
Tribal input, OCSE utilized American Indian experts in the field of 
child support enforcement from three perspectives. These perspectives 
were divided into three distinct tracks: Tribal leadership, legal, and 
social work. The use of the three distinct tracks was the most 
effective means of reaching the various Tribal constituencies, as it 
allowed participants to focus in the areas of most interest to them.
    The Tribal leadership track addressed the questions and concerns of 
Tribal leadership with specific attention being paid to the 
implementation of the Tribal CSE provisions and satisfaction of the 
requirements for the Secretary to issue regulations. The options and 
choices of Tribal governments regarding Tribal CSE program 
implementation were the primary topics of discussion.
    The legal track addressed specific areas of legal concern that 
Tribes had regarding the Tribal CSE regulations. In the legal track, 
the concerns and questions of Tribal attorneys, Tribal court judges, 
and those associated with the legal aspect of the welfare reform law 
were addressed. Legal specialists in Tribal child support enforcement 
were utilized to present the Tribal CSE information.
    The social worker/practitioner track addressed the questions and 
concerns of Tribal staff who would be implementing the Tribal CSE 
provisions of PRWORA. This track focused upon the types of issues and 
situations that may confront front-line Tribal CSE workers before, 
during, and after the implementation of the options available under the 
Tribal CSE provisions of PRWORA. In addition, Tribal CSE workers' 
suggestions and recommendations to improve the implementation of Tribal 
CSE programs were elicited and discussed.
    A general session allowed Tribes the opportunity to present their 
concerns and ask questions about the consultation process. Tribes made 
very clear that they desired the opportunity to present their concerns 
and questions in an unfettered fashion to Federal officials. This final 
session allowed participants the opportunity to review, discuss, and 
summarize their input into the Tribal CSE regulations. The three 
facilitators conducted presentations so that all participants and 
Federal officials could hear concerns raised in each track. This was 
followed by a general discussion by all participants that allowed 
additional comments and concerns to be addressed and brought to the 
attention of Federal officials.

Tribal Issues of Concern

    The consultations were successful in eliciting a wide range of 
questions, issues, concerns, and suggestions. We have worked to ensure 
that information and concerns raised in the consultations were shared 
with both staff working on individual regulatory issues and key 
policymakers. The government-to-government consultations were very 
useful in identifying key issues and evaluating policy options. Several 
issues were repeatedly raised during the consultations, and they are 
summarized below.

1. Sovereignty

    One of the primary issues of concern was that of Tribal 
sovereignty. Federally recognized Indian Tribes have a unique 
government-to-government relationship with the Federal government and 
want to ensure that nothing is done to threaten or lessen their status.
    We recognize the status of Tribes and have attempted to convey 
flexibility and recognition of the status of Tribes in the proposed 
rule. The regulation recognizes the relationship by supporting:
     Tribes' right to design child support programs that 
reflect their laws, traditions, and custom, consistent with Federal law 
and regulations.
     Tribes' right to exercise self-determination and decide 
whether or not to operate a Tribal CSE program.
     The direct funding relationship between Tribes and the 
Federal government.

2. Jurisdiction

    Tribes are very concerned about jurisdictional issues involved in 
the enforcement of Tribal CSE. Some of these issues are concurrent 
jurisdiction, court order modifications, collections from other 
jurisdictions, jurisdiction under Public Law 83-280 (commonly referred 
to as Public Law 280), jurisdiction between a Tribe and States, and 
jurisdictional issues between Indian Tribes. Participants raised 
questions about the role of the Indian Child Welfare Act. They also 
raised concerns about the need to clearly define the recipients of 
Tribal CSE program services.
    The proposed regulations do not address the issue of jurisdiction. 
Fundamentally, the jurisdiction of a Tribal CSE program will be 
determined by Tribal law and the jurisdiction of the Tribe's courts or 
administrative process, and by applicable Federal law (as in the case 
of Public Law 280 States and Tribes). In practice a Tribe's CSE 
``service area'' will be determined by the jurisdiction of its courts 
or administrative process.

3. Full Faith and Credit

    Tribes are concerned with the application and impact of the Federal 
Full Faith and Credit for Child Support Orders Act (28 U.S.C. 1738B) on 
their child support enforcement cases and orders. Will this law erode 
Tribal sovereignty? Will States or other Tribal courts give full faith 
and credit to a Tribe's judgment or Tribal CSE orders? Must Tribes give 
full faith and credit to States and other Tribal CSE orders and 
judgments? Will Tribes have any ability to adjust or abrogate large 
arrearages accrued by a Tribal member under a State child support 
order? Will Tribal courts be able to adjust the current amount of such 
a State order to reflect the level of income and earnings potential of 
Tribal members? Will there be reciprocity of enforcement of Tribal 
decrees and State decrees in courts?
    In order for child support enforcement to succeed in Indian 
country, it is important for State and Tribal governments to work 
together. We remind States that Tribes have a right under law to 
operate their own programs. States should cooperate in giving full 
faith and credit for Tribal child support orders. Likewise, Tribes 
should cooperate with States in giving full faith and credit for State 
child support orders.
    The Full Faith and Credit for Child Support Orders Act (28 U.S.C. 
1738B(b)) defines ``State'' to include ``Indian country (as defined in 
section 1151 of title 18).'' This means that throughout the Full Faith 
and Credit for Child Support Orders Act provisions, wherever the term 
``State'' appears it must be read to include ``Tribe'' as well. The 
Full Faith and Credit for Child Support Orders Act defines ``child 
support order'' to be ``a judgement, decree, or order of a court 
requiring the payment of child support in periodic amounts or in a lump 
sum,'' and ``court'' to mean a ``court or administrative agency of a 
State that is authorized by State law to establish the amount of child 
support payable by a contestant or make a modification of a child 
support order.''
    Section 1738B(c) of the Full Faith and Credit for Child Support 
Orders Act states that ``A child support order made by a court of a 
State is made consistently with this section if--
    (1) A court that makes the order, pursuant to the laws of the State 
in which the court is located and subsections (e), (f), and (g)--

[[Page 50806]]

    (A) Has subject matter jurisdiction to hear the matter and enter 
such an order; and
    (B) Has personal jurisdiction over the contestants; and
    (2) Reasonable notice and opportunity to be heard is given to the 
contestants.''
    Section 1738B(a) of the Full Faith and Credit for Child Support 
Orders Act requires ``the appropriate authorities of each State'' to 
``enforce according to its terms a child support order made 
consistently with this section by a court of another State. * * *'' We 
believe that this means that where a Tribal court or administrative 
agency makes a child support order that is consistent with 28 U.S.C. 
1738B(c), that order must be enforced by the State and where a State 
court or administrative agency makes a child support order that is 
consistent with 28 U.S.C. 1738B(c), that order must be enforced by the 
Tribe.
    In the situation where a Tribal court or administrative agency 
establishes a child support order consistent with 28 U.S.C. 1738B(c) 
and subsequently the obligor Tribal member moves off-reservation, the 
Tribe would lose jurisdiction over that Tribal member, but States would 
have to enforce that Tribal child support order according to its terms 
the same as they would have to enforce a valid child support order from 
any other State.
    In the situation where a State court or administrative agency 
establishes a child support order consistent with 28 U.S.C. 1738B(c) 
and subsequently the obligor Tribal member moves on-reservation, the 
Tribe, under 28 U.S.C. 1738B(a), would have to enforce that State child 
support order according to its terms.
    While Tribes cannot adjust State orders retroactively or reduce 
arrearages owed under State orders, there are ways to ensure support is 
set based on an individual's ability to pay. Tribes can set orders 
based on guidelines and ability to pay. A State could accept less than 
the full payment of arrearages assigned to the State on the same 
grounds that exist for compromise and settlement of any other judgment 
in the State. However, under the terms of FFCCSOA, a Tribe or Tribal 
organization may not modify a child support order issued by a State if 
such order complies with 28 U.S.C. 1738B(c) unless the issuing State no 
longer has continuing, exclusive jurisdiction and the Tribe has proper 
jurisdiction to issue orders or the parties file written consent to the 
modification. If no party or the child reside in the issuing State, the 
Indian Tribe may modify and enforce the order by registering that order 
with the State with jurisdiction over the non-moving party. In the 
absence of assignment, child support arrears may only be compromised by 
an agreement between the obligee and obligor. We encourage States and 
Tribes to work together on this and other issues.

4. Access to Federal Processes, Privacy Concerns and Computer Systems

    Tribes want to know if they will be able to access the Federal 
Parent Locator Service (FPLS) and the Federal Income Tax Refund Offset 
Program. They also desire to set up their own CSE computer systems. 
Tribes have privacy concerns relating to data collected by Tribes on 
their members, which they do not want made public.
    Tribes may access the FPLS through either a State Parent Locator 
Service or by a secured electronic means in accordance with 
instructions issued by the Secretary. We are soliciting comments, in 
another section of this preamble, on the development of options for 
direct Tribal access to FPLS. We are also coordinating with the IRS to 
determine the extent to which Tribes may have access to tax return 
information for locate and enforcement purposes.
    The Internal Revenue Code does not provide direct access by Tribes 
to the Federal Income Tax Refund Offset process. However, Tribes and 
Tribal organizations may access the Federal Income Tax Refund Offset 
Program by submittal through State IV-D offices. This issue is 
addressed in more detail in a later section of the preamble.
    Under these proposed rules, the reasonable and allowable costs of 
developing and operating Tribal CSE computer systems are eligible for 
Federal funding under an approved Tribal CSE program. We agree that the 
nature of child support data is highly confidential and, therefore, the 
proposed rule incorporates strict safeguarding requirements.

5. Paternity

    There are Tribal concerns surrounding the establishment of 
paternity by Tribal tradition versus genetic testing. There are also 
privacy concerns regarding access to data obtained from any genetic 
testing. Will States honor Tribal paternity judgments based on Tribal 
law, code, tradition, and custom?
    The proposed rule recognizes the unique nature of Tribal law and 
tradition and seeks to ensure that Tribal tradition, customs and 
practices are honored. Establishment of paternity for child support 
purposes does not automatically enroll minor children into Tribes. Each 
Tribe has codes that address Tribal membership requirements. Tribes 
will continue to determine membership in accordance with their 
enrollment criteria. Privacy, as addressed previously, is crucial to 
the success of the program and the protection of individual rights, 
both Indian and non-Indian alike.
    We believe that under the State-enacted Uniform Interstate Family 
Support Act (UIFSA) statutes and the Full Faith and Credit for Child 
Support Orders Act, States are required to honor Tribal child support 
orders based on paternity establishment pursuant to Tribal law, in the 
same manner that a Tribe is compelled to honor a State child support 
order based on a State's determination of paternity.

6. Funding

    A significant concern is how Tribes will be funded to operate 
Tribal CSE programs. Will grants to Tribes be funded at the 100 percent 
level? Will Tribes have lump sum payments and access to incentives? 
Will the funding mechanism afford all Tribes a reasonable base amount? 
Can there be privatization of services under funding? Do Tribes have to 
negotiate their funding level with States? Is there a match 
requirement? How much money will be available for Tribal CSE programs?
    Under this proposed rule, funding will be awarded for 90 percent of 
the total amount of estimated and approved costs necessary for a Tribe 
or Tribal organization to operate an approved Tribal CSE program for 
the first three years of operation of a full Tribal CSE program under 
Sec. 309.65(a). We are proposing a 10 percent non-Federal match in cash 
and/or in kind from Tribes and Tribal organizations, with provisions 
for waiver of this matching requirement for Tribes and Tribal 
organizations that lack sufficient resources. After a Tribe has 
operated a full CSE program for three years at the 90 percent match 
rate (not including any period of start-up funding), the Tribe's match 
would be increased to 20 percent and the Federal matching rate would be 
reduced to 80 percent. However, within five years of publication of the 
final rule, if the Secretary determines based on experience gained 
through operation of child support Tribal programs and consultation 
with Tribes that the 80/20 match rate is disruptive to the program and 
imposes hardship to Tribes, the regulations will be revised 
accordingly.
    While this level of Federal matching is higher than the current 66 
percent matching rate available to States for

[[Page 50807]]

most title IV-D activities, it is akin to the higher Federal financial 
support States received in the early years of their programs. At that 
time the combination of Federal matching and incentive payments 
supported about 93 percent of a State's IV-D expenditures.
    See proposed regulations at Subpart D--Tribal CSE Program Funding, 
for a discussion on the proposed match and how funding will be made 
available. The proposed regulation allows for start-up costs and 
explicitly allows Tribes and Tribal organizations full flexibility to 
operate all or part of their programs and to contract with other 
entities--e.g., other Tribes, States, private organizations--to operate 
other portions of the program. Any combination is acceptable provided 
all requirements of the regulations and statute are met.

7. Existing Cooperative Agreements

    How will existing cooperative agreements be affected? Can Tribes 
reach new cooperative agreements? Can old cooperative agreements be 
amended?
    Indian Tribes operating directly funded Tribal CSE programs will 
find that the nature of their relationships with States has changed. 
For many Tribes, direct funding under section 455(f) will effectively 
replace or supersede their cooperative agreements with States. Tribes 
operating Tribal CSE programs under section 455(f) may obtain services 
from other entities, including States, through contracts or cooperative 
agreements. However, in this context, ``cooperative agreements'' has a 
different meaning than under section 454(33). Cooperative agreements 
reached in these situations, i.e., under section 455(f), will be for 
the purpose of a Tribe's obtaining services for its program from 
another source, rather than providing services under the auspices of a 
State's IV-D program, i.e., under section 454(33).

8. Technical Assistance

    Is it available? Who will provide the technical assistance? Will 
money be available for infrastructure development?
    OCSE will provide technical assistance to Tribal CSE agencies 
operating Tribal CSE programs. In addition, this rule proposes that 
Tribes be able to use grant funds to obtain technical assistance from 
other Tribes, States and vendors and to provide technical assistance to 
other Tribes and States.

9. Eligibility/Start-up Costs

    Who will be eligible to operate a Tribal CSE program? How quickly 
will a Tribe or Tribal organization be expected to have its program 
operational? Will there be provisions for start-up costs?
    We propose that Federally recognized Tribes and Tribal 
organizations with at least 100 children under the age of majority as 
defined by Tribal law or code and within their jurisdiction are 
eligible to apply to directly operate a Tribal CSE program. We 
encourage Tribes with fewer than 100 children under the age of majority 
within their jurisdictions to consider entering into consortia 
arrangements with other Tribes, so that the combined total number of 
children under the age of majority within the Tribes' jurisdictions is 
100 or more. These consortia could qualify as Tribal organizations for 
direct Tribal CSE funding. These arrangements could assist participants 
in providing efficient and effective child support enforcement 
services.
    We anticipate that some Tribes and Tribal organizations will need 
time to structure programs and put in place the necessary laws and 
procedures. Accordingly, we propose to make start-up funding available 
for a maximum of two years, during which time we expect the Tribe or 
Tribal organization to make satisfactory progress in putting the 
required elements of a full CSE program in place. By the end of this 
start-up phase, we expect the Tribe to be able to operate-either 
directly or via contracts or agreements with other parties-all required 
elements.

Regulatory Reform

    In its latest Document Drafting Handbook, the Office of the Federal 
Register supports the efforts of the National Performance Review and 
encourages Federal agencies to produce more reader-friendly 
regulations. In a memo dated June 1, 1998, the President urged the use 
of plain language in Government writing. In drafting this proposed 
rule, we have paid close attention to this guidance.

Regulatory Philosophy

    Federal statutory and regulatory requirements on State child 
support programs have evolved and grown more specific over time. Many 
Tribes are just beginning to provide child support services to 
families. We intend to work with Tribal CSE agencies to ensure that 
their ability to establish Tribal child support programs is 
strengthened and fine-tuned over time. Regulations governing Tribal CSE 
programs must accommodate the differences between the new CSE programs 
of Federally recognized Tribes, which have a unique government-to-
government relationship with the Federal government, and State CSE 
programs, which have evolved over the last two dozen years.
    For the first time in the history of the Child Support Enforcement 
program, Tribes are specifically mentioned in the law. Section 455(f) 
of the Act, as added by PRWORA, gives OCSE an opportunity to provide 
direct funding to Indian Tribes in an unprecedented manner and to 
support Tribal self-determination. These regulations reflect OCSE's 
commitment to partnership with Tribes and Tribal organizations.

Scope of Rulemaking

    This regulation focuses on the explicit requirement in section 
455(f) of the Act, which allows the Secretary to make direct payments 
to Tribes and Tribal organizations that demonstrate the capacity to 
operate a CSE program which meets the objectives of title IV-D of the 
Act, including establishment of paternity, establishment, modification, 
and enforcement of support orders, and location of absent parents.
    We propose to amend the Federal child support regulations by adding 
a new part 309, Tribal Child Support Enforcement (CSE) Program, under 
title 45 of the Code of Federal Regulations. This NPRM proposes to 
establish a basic regulatory structure for the Tribal CSE program in 
proposed part 309, which consists of subparts A through F.
    In the separate interim final rule published concurrently with this 
NPRM, we are codifying interim final regulations for Tribes and Tribal 
organizations that currently operate comprehensive CSE programs. The 
interim final rule adds a new part 310, Comprehensive Tribal Child 
Support Enforcement (CSE) Programs, to the Federal child support 
regulations. 45 CFR Part 310 is effective upon publication of the 
interim final rule.
    In this NPRM, we are proposing for public comment essentially the 
same set of requirements as are in subparts A through F of the interim 
final rule, with the following exception. The NPRM includes proposed 
provisions both for Tribes and Tribal organizations that already are 
able to operate full, comprehensive CSE programs, and for Tribes and 
Tribal organizations that do not already operate comprehensive CSE 
programs and need program development funding for start-up CSE 
programs. Because the interim final rule applies only to Tribes and 
Tribal organizations that already operate comprehensive CSE programs, 
it does

[[Page 50808]]

not include provisions for program development funding for start-up CSE 
programs. (The proposed program development start-up provisions in this 
NPRM are in Secs. 309.15(b)(2), 309.25(d), 309.65(b), 309.65(c), and 
309.150.)
    We will develop final rules for Tribal CSE programs based on 
comments on this NPRM and the interim rule. The final rules will apply 
to all Tribal CSE programs. We expect the final rules to be codified at 
45 CFR part 309. When the final rules for Tribal CSE programs are 
published, 45 CFR part 310 (the interim final rule) will be deleted 
from the Federal child support regulations.

Discussion of Regulatory Provisions

    The following is a discussion of all the regulatory provisions 
included in this NPRM. The discussion follows the order of regulatory 
text, addressing each subpart and section in turn.

Subpart A--Tribal Child Support Enforcement (CSE) Program: General 
Provisions

What Does This Part Cover? (section 309.01)

    In paragraph (a), we propose that part 309 prescribe the rules for 
implementing section 455(f) of the Social Security Act (the Act). 
Section 455(f) of the Act authorizes direct grants for Indian Tribes 
and Tribal organizations to operate child support enforcement programs.
    In paragraph (b), we propose that these regulations establish the 
requirements that must be met by Indian Tribes and Tribal organizations 
to be eligible for grants under section 455(f). They also establish 
requirements for: Tribal CSE plan and application content, submission, 
approval, and amendment; program funding; program operation; uses of 
funds; accountability; reporting; and other program requirements and 
procedures.
    In recognition of the unique legal relationship the United States 
has with Tribal governments, these regulations will be applied in a 
manner that respects and promotes the government-to-government 
relationship between Federally recognized Indian Tribal governments and 
the United States government and Tribal self-determination.

What Definitions Apply to This Part? (section 309.05)

    This section of the proposed rule includes definitions of some 
terms used in part 309. In drafting this section, we have defined those 
terms used in the proposed rule that must be understood consistently by 
all who use these rules. Most terms are self-explanatory, e.g., 
acronyms or shortened versions of longer titles. Only five bear further 
explanation in this preamble.
    We define CSE services as ``the services that are required for 
establishment of paternity, establishment, modification, and 
enforcement of support orders, and location of noncustodial parents as 
required in title IV-D of the Act, this rule, and the Tribal CSE plan. 
In some situations, the appropriate service may be for a Tribe or 
Tribal organization to refer an applicant for CSE services to another 
Tribal CSE agency or a State IV-D agency.''
    We define Indian as ``a person who is a member of an Indian 
Tribe.'' This is the same as the definition of this term in section 4 
of the Indian Self-Determination and Education Assistance Act, Public 
Law 93-638.
    We define Indian Tribe and Tribe as ``any Indian or Alaska Native 
Tribe, band, nation, pueblo, village, or community that the Secretary 
of the Interior acknowledges to exist as an Indian Tribe and includes 
in the list of Federally recognized Indian Tribal governments as 
published in the Federal Register pursuant to 25 U.S.C. 479a-1.'' This 
definition includes the definition of ``Indian tribe'' from section 102 
of the Federally Recognized Indian Tribe List Act of 1994, Public Law 
103-454 (25 U.S.C. 479a), which also is included at 18 U.S.C. 228, 
``Failure to pay legal child support obligations.''
    Because child support enforcement requires at least delegated 
governmental authority, we propose that basic eligibility under section 
455(f) be limited to Federally recognized Indian Tribal governments. 
The Federal government acknowledges the governmental status of these 
Tribes and has a government-to-government relationship with them.
    The Department of the Interior's published list of Federally 
recognized Tribes includes Tribes in the contiguous 48 States and 
Alaska Native villages and Tribes that function as political entities 
exercising governmental authority. The list includes all Indian Tribes 
which the Department of the Interior recognizes to be eligible for the 
special programs and services provided by the United States to Indians 
because of their status as Indians. In the Tribal CSE program we 
propose to use the most current list of Federally recognized Tribes, 
including any Tribes added to each current list after publication.
    The most recent list of these Tribes, entitled ``Indian Entities 
Recognized and Eligible to Receive Services From the United States 
Bureau of Indian Affairs,'' was published in the Federal Register in a 
notice on March 13, 2000, pursuant to section 104 of Public Law 103-
454. This notice states that these ``entities are acknowledged to have 
the immunities and privileges available to other federally acknowledged 
Indian tribes by virtue of their government-to-government relationship 
with the United States as well as the responsibilities, powers, 
limitations and obligations of such tribes.''
    We define Tribal CSE agency as ``the organizational unit in the 
Tribe or Tribal organization that has the delegated authority for 
administering or supervising the Tribal CSE program under section 
455(f) of the Act.''
    We define Tribal organization as ``the recognized governing body of 
any Indian Tribe as defined in this part; any legally established 
organization of Indians which is controlled, sanctioned, or chartered 
by such governing body or which is democratically elected by the adult 
members of the Indian community to be served by such organization and 
which includes the maximum participation of Indians in all phases of 
its activities: Provided, That in any case where a contract is let or 
grant made to an organization to perform services benefitting one or 
more Indian Tribes, the approval of each such Indian Tribe shall be a 
prerequisite to the letting or making of such contract or grant.'' This 
definition of ``Tribal organization'' is based on the definition of 
``tribal organization'' in section 4 of the Indian Self-Determination 
and Education Assistance Act, Public Law 93-638.
    We have determined that basic eligibility for direct IV-D funding 
for Tribal CSE programs under section 455(f) is limited to Federally 
recognized Indian Tribes that exercise governmental authority. As any 
other governmental entity, eligible Tribes may delegate certain 
governmental authority to non-governmental bodies. This aspect of 
sovereignty is not unique to Indian Tribes but is equally applicable to 
State governments as well. We therefore propose that, in implementing 
section 455(f), a Federally recognized Tribal government may choose to 
carry out its own child support enforcement program, or it may choose 
to designate a Tribal organization to carry out a CSE program on its 
behalf. The Tribal organization would be vested by the Tribe to apply 
for and carry out a CSE program on its behalf; the Tribe's 
authorization would be provided by resolution.
    Section 454(33) of the Act incorporates the definitions of ``Indian 
tribe'' and ``tribal organization'' in section 4 of Public Law 93-638. 
Section

[[Page 50809]]

454(33) authorizes cooperative agreements between certain Indian Tribes 
or Tribal organizations and State agencies operating a State Child 
Support Enforcement Program under title IV-D of the Act to ``provide 
for the cooperative delivery of child support enforcement services in 
Indian country.'' As noted, we believe that child support enforcement 
requires certain inherent governmental authorities. Because the 
definition of ``Indian tribe'' in Public Law 93-638 includes some 
entities that are not Tribal governments (e.g., the Alaska Native 
regional and village corporations as defined in or established pursuant 
to the Alaska Native Claims Settlement Act), we have not adopted that 
definition of ``Indian Tribe'' in this proposed rule for Tribal CSE 
programs under section 455(f). However, because CSE programs carried 
out under cooperative agreements pursuant to section 454(33) are 
carried out as part of a State government's CSE program, it is not 
necessary for ``Indian Tribes'' that reach cooperative agreements with 
States under section 454(33) to be governments.
    We are interested in receiving public comments on our proposed 
definitions of Indian Tribe and Tribal organization.

Who is eligible to apply for Federal funding to operate a Tribal CSE 
program? (section 309.10)

    In proposed paragraph (a), an Indian Tribe with at least 100 
children under the age of majority as defined by Tribal law or code, in 
the population subject to the jurisdiction of the Tribe, is eligible to 
apply to receive Federal funding to operate a Tribal CSE program 
meeting the requirements of this part.
    In proposed paragraph (b), a Tribal organization that demonstrates 
the authorization of one or more Indian Tribes to operate a Tribal CSE 
program on their behalf is eligible to apply to receive Federal funding 
to operate a Tribal CSE program meeting the requirements of this part. 
In order for a Tribal organization to receive Tribal CSE funding, there 
must be at least 100 children under the age of majority as defined by 
Tribal law or code, in the population subject to the jurisdiction of 
the Tribe(s) on whose behalf the organization is applying.
    We considered allowing Tribes with at least 50 children under the 
age of majority to apply for direct funding. The Child Care and 
Development Fund program, which also is administered by the 
Administration for Children and Families, requires a minimum of 50 
children under age 13.
    However, we believe that requiring a minimum of 100 children under 
the age of majority would be more appropriate for the Tribal child 
support enforcement program. This proposed requirement is based on the 
economics of establishing a CSE infrastructure and operating a CSE 
program. We believe that a CSE program can effectively and efficiently 
serve a 100-child population. We have concerns about whether it would 
be cost effective to operate a separate CSE program serving fewer 
children.
    Tribes with fewer than 100 children will not be excluded from the 
Tribal CSE program. They may form a consortium with other Tribes to 
form a larger base and provide services to the children in need; one 
example of a Tribal organization that may apply for and receive direct 
Tribal CSE funding is a consortium of Tribes that, individually, may 
not have 100 children within their CSE jurisdictions, but have a 
combined total of 100 or more children when joined in the consortium. 
In addition, Tribes may authorize an existing Tribal organization (such 
as an Alaska Native regional nonprofit or an inter-tribal council) or 
another Tribe to provide CSE services on their behalf. This will enable 
them to take advantage of economies of scale and other benefits 
associated with larger programs, and will help to ensure that the 
programs are cost effective.
    The proposed minimum of 100 children is based on the best 
information available to us at this time. However, we are specifically 
requesting comments on the minimum number of children that could be 
served by a Tribal CSE program at a cost that is reasonable.
    Federally recognized Indian Tribal governments possess inherent 
governmental authority and sovereignty rights. The Federal government 
has a government-to-government relationship with them. As noted, we 
believe that eligibility to apply for direct grants for child support 
enforcement programs requires governmental authority. In proposed 
paragraph (b), each Tribal organization applying to operate a Tribal 
CSE program on behalf of one or more Tribes must include documentation 
of authorization from each Tribe to operate a Tribal CSE program on its 
behalf.

Subpart B--Tribal CSE Program Application Procedures

What is a Tribal CSE program application? (section 309.15)

    This section of the proposed rule will establish the mandatory 
elements of a request for funding under section 455(f) of the Act.
    In paragraph (a), we define a Tribal CSE initial funding 
application. The application includes standard application forms (SF 
424, Application for Federal Assistance, and SF 424A--Budget 
Information--Non-Construction Programs) and a Tribal CSE plan.
    The standard application forms outline the costs estimated by 
Tribes and Tribal organizations for funding of Tribal CSE programs on 
an annual basis. The forms require information including name of 
agency, type of application, descriptive title of applicant's project, 
estimated funding, budget categories (personnel, travel, equipment, 
supplies, contractual, indirect charges), non-Federal resources and 
forecasted cash needs. Tribes and Tribal organizations have used these 
forms and are familiar with them. Rather than develop a new application 
form, we chose to use existing forms.
    The Tribal CSE plan is a comprehensive statement meeting the 
requirements of subpart C, that describes the capacity of the Tribe or 
Tribal organization to operate a CSE program meeting the objectives of 
title IV-D of the Act, including the establishment of paternity, 
establishment, modification, and enforcement of support orders, and 
location of noncustodial parents.
    In proposed paragraph (b), we define Tribal CSE annual refunding 
applications. Refunding applications include standard application forms 
SF 424 and SF 424A. As appropriate, refunding applications also may 
include amendment(s) to the Tribal CSE plan. The refunding application 
of a Tribe or Tribal organization receiving start-up funding under 
Sec. 309.65(b) also must include a progress report on its 
accomplishments to date and any proposed changes to its CSE plan and 
schedule.
    In paragraph (c), we propose that the application of a Tribal 
organization must adequately demonstrate that each participating Tribe 
authorizes the Tribal organization to operate a Tribal CSE program on 
its behalf. This language is meant to ensure that a Tribal organization 
representing itself as an agent of a Tribe has the express authority to 
do so.

Who submits a Tribal CSE program application? (section 309.20)

    Under Sec. 309.20, we propose that the authorized representative of 
the Tribe or Tribal organization must sign and submit the Tribal CSE 
program application.
    Originally, there was much discussion about who should submit the 
application. Because there are so many

[[Page 50810]]

different titles for Tribal leaders, and since Tribal CSE programs 
might be operated by a Tribal organization, we decided that the term 
``authorized representative'' would mean an individual authorized by a 
Tribe or Tribal organization to submit that Tribe or Tribal 
organization's application.

When must a Tribe or Tribal organization submit a Tribal CSE program 
application? (section 309.25)

    In paragraph (a) we propose that the initial application consisting 
of the Tribal CSE program plan that meets the requirements under 
Subpart C, and the Application and Budget Information forms (SF 424, 
Application for Federal Assistance and the SF 424A, Budget 
Information--Non-Construction Programs) may be submitted at any time.
    In maintaining flexibility for the Tribes and Tribal organizations, 
we believe that permitting the submission of applications at any point 
in the fiscal year will be advantageous because the Tribes and Tribal 
organizations will not be constricted by the Federal fiscal year and 
may submit an application when they are ready to begin operation of a 
Tribal CSE program. This will not impose any deadlines for Tribes and 
Tribal organizations submitting initial applications.
    In paragraph (b), we propose that subsequent refunding applications 
containing only SF 424, Application for Federal Assistance and SF 424A, 
Budget Information--Non-Construction Programs, must be submitted 
annually, 60 days before the beginning of the next budget period if the 
Tribe or Tribal organization wishes to receive its funding on time. The 
refunding requests are necessary after approval of the initial 
application, and must be approved on an annual basis, because the 
Tribes and Tribal organizations will be operating on an annual funding 
cycle.
    In paragraph (c), we propose that if a Tribe or Tribal organization 
intends to make any substantial or material change in any aspect of the 
Tribal CSE program: (1) A Tribal CSE plan amendment describing and, as 
appropriate, documenting the changes the Tribe or Tribal organization 
proposes to make to its CSE plan, consistent with the requirements in 
Sec. 309.65, must be submitted at the earliest reasonable time for 
approval under Sec. 309.35; and (2) any amendment of an approved Tribal 
CSE plan may, at the option of the Tribe or Tribal organization, be 
considered as a submission of a new Tribal CSE plan. If the Tribe or 
Tribal organization requests that an amendment be considered as a 
submission of a new plan, the amendment must be submitted no less than 
90 days before the proposed effective date of the new plan.
    In paragraph (d), we propose that if a Tribe or Tribal organization 
receives funding based on submittal and approval of a Tribal CSE plan 
under Sec. 309.65(b), a progress report that describes accomplishments 
to date and any alterations to the Tribe or Tribal organization's plan 
and schedule must be submitted with the next annual refunding request. 
We want to ensure that the Tribal CSE agency is making progress towards 
implementation of a fully operational Tribal CSE program. This is 
discussed in more detail in a later section of the preamble.
    In paragraph (e), we propose that the effective date of a plan 
amendment may not be earlier than the first day of the calendar quarter 
in which an approvable plan is submitted.

Where does the Tribe or Tribal organization submit the application? 
(section 309.30)

    We propose that applications must be submitted to the Federal 
Office of Child Support Enforcement, Attention: Tribal Child Support 
Enforcement Program, 370 L'Enfant Promenade, SW, Washington, DC 20447, 
with a copy to the appropriate Regional Office.
    We also encourage Tribes and Tribal organizations to provide a copy 
of their approved Tribal CSE plan to their State counterparts. 
Communication between Tribes and Tribal organizations and State IV-D 
agencies will facilitate child support services. This may help to 
eliminate duplicate efforts on the part of both Tribal CSE agencies and 
State IV-D agencies.

What are the procedures for approval or disapproval of Tribal CSE 
program applications and plan amendment(s)? (section 309.35)

    In paragraph (a), we propose that the Secretary of the Department 
of Health and Human Services or designee will determine whether the 
Tribal CSE program application or Tribal CSE plan amendment submitted 
for approval conforms to the requirements of approval under the Act and 
these regulations not later than the 90th day following the date on 
which the Tribal CSE application or Tribal CSE plan amendment is 
received by the Secretary or designee, unless additional information is 
needed from the Tribe or Tribal organization. The Secretary or designee 
will notify the Tribe or Tribal organization if additional time or 
information is required to determine whether the application or plan 
amendment may be approved. It is important to note that this paragraph 
provides that applications will be approved or disapproved by the 
Secretary or designee, in keeping with the government-to-government 
relationship.
    In paragraph (b), we propose that the Secretary or designee will 
approve the application or determine that the application will be 
disapproved within 45 days of receipt of any additional information 
requested from the Tribe or Tribal organization.
    We believe parameters for approval and disapproval of applications 
are important. We contemplated a 45-day timeframe for review of the 
application, but decided that would be unrealistic and decided on 90 
days for the review of applications. We also wanted to make allowances 
for the occasional submission of an incomplete plan and the 
resubmission of required information. OCSE will work closely with the 
Tribes and Tribal organizations to ensure that applications are 
approved (or disapproved) in accordance with the timeframes set forth. 
We think that this approach to the timeframes will be acceptable to all 
parties.
    OCSE also considered imposing timeframes for Tribes' submission of 
additional information necessary to complete their applications. 
However, we decided that as it was in a Tribe's best interest to submit 
such information quickly, there was no need to impose an arbitrary 
deadline. In general, we have attempted in this regulation not to 
impose due dates and timeframes unless there was a compelling Federal 
interest to be satisfied.

What is the basis for disapproval of a Tribal CSE program application 
or plan amendment(s)? (section 309.40)

    In paragraph (a), we propose an application or plan amendment will 
be disapproved if:
    (1) The Secretary or designee determines that the application or 
plan amendment fails to meet one or more of the requirements set forth 
in this part;
    (2) The Secretary or designee determines that the laws, codes, 
regulations and procedures contained in the application or plan 
amendment will not achieve the outcomes consistent with the objectives 
of title IV-D including: Establishment of paternity, establishment, 
modification and enforcement of support orders and location of 
noncustodial parents; ensuring access to services; basing child support 
orders on the noncustodial parent's ability to pay; distribution of 
payments to families; protecting due

[[Page 50811]]

process rights of the individuals involved; and safeguarding data;
    (3) The Secretary or designee determines that the application or 
plan amendment is not complete (after the Tribe or Tribal organization 
has had the opportunity to submit the necessary information); or
    (4) The Secretary or designee determines the requested funding is 
not reasonable and necessary (after the Tribe or Tribal organization 
has had the opportunity to make appropriate adjustments).
    The requirements of the application and plan are found at 
Sec. 309.65. Not only must these required elements be included in the 
Tribal plan, there must be evidence that the procedures outlined in the 
plan will result in outcomes consistent with the objectives of the 
title IV-D program. A Tribe or Tribal organization must demonstrate 
that its submission is expected to achieve desired outcomes, including 
establishment of paternity, establishment, modification and enforcement 
of support orders, and location of noncustodial parents; ensuring 
access to services; basing child support orders on the noncustodial 
parent's ability to pay; distribution of payments to families; 
protection of due process rights of the individuals involved; and 
safeguarding of data. Each requirement is discussed in more detail in 
another section of the preamble.
    In paragraph (b), we propose that a written Notice of Disapproval 
of the Tribal CSE program application will be sent to the Tribe or 
Tribal organization upon the determination that any of the conditions 
of Sec. 309.40(a) apply. The Notice of Disapproval will include the 
specific reason(s) for disapproval.

How may a Tribe or Tribal organization request a reconsideration of a 
disapproval action? (section 309.45)

    In paragraph (a), we propose that a Tribe or Tribal organization 
may request reconsideration of disapproval of a Tribal CSE application 
or amendment by filing a written Request for Reconsideration to the 
Secretary or designee within 60 days of the date of the Notice of 
Disapproval.
    In proposed paragraph (b), the Request for Reconsideration must 
include (1) all documentation that the Tribe or Tribal organization 
believes is relevant and supportive of its application or plan 
amendment; and (2) a written response to each ground for disapproval 
identified in the Notice of Disapproval, indicating why the Tribe or 
Tribal organization believes its application or plan amendment conforms 
to the requirements for approval specified at Sec. 309.65 and subpart 
C.
    After receiving a Request for Reconsideration, the Secretary or 
designee will hold a conference call or, at the Department's 
discretion, a meeting with the Tribe or Tribal organization as part of 
the reconsideration, to discuss the reasons for the Department's 
disapproval of the application or plan amendment, and the Tribe or 
Tribal organization's response. In paragraph (c), we propose that 
within 30 days after receipt of a Request for Reconsideration, the 
Secretary or designee will notify the Tribe or Tribal organization of 
the date and time the conference call or meeting will be held. In 
paragraph (d), we propose that the conference call or meeting shall be 
held not less than 30 days nor more than 60 days after the date the 
notice of the call or meeting is furnished to the Tribe or Tribal 
organization, unless the Tribe or Tribal organization agrees in writing 
to another time. In paragraph (e), we propose that the Secretary or 
designee will make a written determination affirming, modifying, or 
reversing disapproval of a Tribal CSE program application or plan 
amendment within 60 days after the conference call or meeting is held, 
and that this determination upon reconsideration will be the final 
decision of the Secretary concerning this application or plan 
amendment. No further administrative appeal would be permitted.
    In paragraph (f), we propose the Secretary or designee's initial 
determination that a Tribal CSE application or plan amendment is not 
approvable remains in effect pending reconsideration under this part.
    These provisions will ensure that any Tribe or Tribal organization 
whose CSE program application is disapproved will have the benefit of 
reconsideration provided that it requests reconsideration in a timely 
manner.

What are the consequences of disapproval of a Tribal CSE program 
application or plan amendment? (section 309.50)

    In paragraph (a), we propose that if an application submitted 
pursuant to Sec. 309.25 is disapproved, the Tribe or Tribal 
organization can receive no funding under section 455(f) of the Act or 
this part until a new application is submitted and approved.
    In proposed paragraph (b), if a plan amendment is disapproved there 
is no funding for the activity proposed in the plan amendment.
    In proposed paragraph (c), a Tribe or Tribal organization whose 
application or plan amendment has been disapproved may reapply at any 
time. Once a Tribe or Tribal organization has remedied the deficiency 
in its application that caused the disapproval, it may reapply for 
Federal funding.

Subpart C--Tribal CSE Plan Requirements

What does this subpart cover? (section 309.55)

    During consultation with the Tribes, it was evident that Tribes 
wanted regulations that were broad and not overly prescriptive. Tribes 
said that regulations that were too prescriptive would impinge on 
sovereignty issues and issues of tradition and custom. The statute 
indicates that a Tribe or Tribal organization must demonstrate the 
capacity to run a program that meets the objectives of title IV-D of 
the Act. We believe the mandatory requirements that we propose are 
necessary components that must be in place in order to meet title IV-D 
objectives and to operate the program efficiently and effectively.
    We have included in the plan requirements only those items that we 
have concluded must be present in order for a Tribe or Tribal 
organization to demonstrate that it is capable of carrying out a child 
support program that meets the objectives of title IV-D. While the 
proposed regulation lists a number of functions that a Tribe or Tribal 
organization must include in its plan, we have, for the most part, 
regulated neither the manner in which those functions must be carried 
out nor the timeframe. In those cases where we have included more 
specificity, this reflects our conclusion that additional guidance was 
necessary to ensure that the objectives of title IV-D would be met or 
to ensure the effective and efficient administration of Tribal CSE 
programs.
    With respect to timeframes, we continue to believe that timely 
action is essential to effective services. In fact, title IV-D has been 
amended over the years, to mandate various case processing timeframes 
for State action, especially as programs have become more automated. 
However, we believe it would be premature to consider such timeframes 
with respect to Tribal programs. Like States, Tribes need adequate time 
to develop their programs and to determine appropriate approaches, 
levels of automation, and processes for delivering services before 
adequate information will exist to consider specific timeframes for 
taking action. However, with such experience we believe timeframes for 
Tribal case processing may work to ensure that

[[Page 50812]]

Tribal families receive prompt and effective services.
    As States gained experience in operating IV-D programs, we worked 
with them to set timeframe requirements for State programs. Similarly, 
as Tribes gain experience in operating CSE programs, we are committed 
to working with them to address timeframe requirements for Tribal 
programs. Tribes and we need experience with operational Tribal 
programs in order to learn how long it takes to carry out various 
Tribal CSE functions and to develop realistic timeframes based on this 
experience. Since most Tribal CSE programs will initially be start-up 
programs, we are proposing to begin these discussions with Tribes on 
the development of timeframes three years after publication of the 
final rules. As that point we hope to have sufficient experience with 
Tribal CSE programs to begin formally incorporating appropriate 
timeframes into Tribal CSE programs. Given the importance of timeframes 
in the Child Support program, we encourage your comments on this 
proposed approach to development of timeframes. Is three years too long 
to wait to begin discussion? Does three years provide sufficient time/
experience with Tribal Child Support programs to develop workable 
timeframes?
    In the meantime, we will communicate extensively with Tribes as 
they begin to design their CSE programs and applications and to 
implement their CSE programs. We will provide technical assistance to 
help them set realistic timeframe goals and carry out CSE functions in 
a timely and effective way.
    We have attempted to keep the list of tasks that a Tribal CSE 
program must carry out in order to meet the criteria for direct Federal 
funding to the minimum necessary to ensure an effective and successful 
Tribal CSE program. In developing this list, we believe that every 
child support program in the United States must have certain 
fundamental characteristics in order to be successful and to enhance 
the effectiveness of the National child support effort. In developing 
this list, we have gone beyond the five core functions listed in 
section 455(f) of the Act. However, we believe the additional tasks we 
propose to add are consistent with the statutory requirement that a 
Tribe or Tribal organization demonstrate that it has the capacity to 
operate a child support enforcement program meeting the objectives of 
title IV-D of the Act.
    These tasks ensure that Tribes and Tribal organizations will be 
able to take advantage of enforcement techniques that have been proven 
to be effective and will ensure that Tribes and Tribal organizations 
will be able to call on the resources of the entire National child 
support effort in pursuing noncustodial parents, both on and off the 
reservation.
    Therefore, we propose to define in this subpart the Tribal CSE plan 
provisions which are required and which demonstrate that a Tribe or 
Tribal organization has the capacity to operate a child support 
enforcement program meeting the objectives of title IV-D of the Act, 
including establishment of paternity, establishment, modification, and 
enforcement of support orders, and location of noncustodial parents. 
The plan is a narrative description of the Tribal CSE program. We chose 
not to regulate exactly the format, but rather to give parameters for 
Tribal plans. It is not our intention to tell a Tribal CSE agency how 
to write its plan; each plan may be different as long as it contains 
the required information. A recurring concern during the consultations 
was that Tribes wanted a child support program that was sensitive to 
Tribal values, customs and traditions. Because of the unique government 
to government relationship, the Tribal CSE plan gives the Tribe or 
Tribal organization an opportunity to outline its child support 
program-describing Tribal codes, laws, values, customs and traditions 
as they relate to CSE, showing how it meets each of the statutory 
requirements for direct funding, and describing in detail the child 
support enforcement program it will operate.

Who is ultimately responsible for administration of the Tribal CSE 
program under the Tribal CSE plan? (Section 309.60)

    In paragraph (a), we propose that under the Tribal CSE plan, the 
Tribe or Tribal organization shall establish or designate an agency to 
administer the Tribal CSE plan. That agency shall be referred to as the 
Tribal CSE agency.
    In paragraph (b), we propose that the Tribe or Tribal organization 
is responsible and accountable for the operation of the Tribal CSE 
program. Except where otherwise provided in this part, the Tribal CSE 
agency need not perform all the functions of the Tribal CSE program, so 
long as the Tribe or Tribal organization insures that all approved 
functions are carried out properly, efficiently and effectively.
    In proposed paragraph (c), if the Tribe or Tribal organization 
delegates any of the functions of the Tribal CSE program to another 
Tribe, a State and/or another agency pursuant to a cooperative 
agreement, contract or Tribal resolution, the Tribe or Tribal 
organization is responsible for securing compliance with the 
requirements of the Tribal CSE plan by such Tribe, State or agency. The 
Tribe or Tribal organization is responsible for submitting copies and 
appending to the Tribal CSE plan any agreements, contracts or Tribal 
resolutions between the Tribal CSE agency and a Tribe, State or other 
agency.
    A Tribe or Tribal organization may choose to provide CSE services 
in any number of combinations: for example, by operating a program 
under agreement with a State whereby the State provides some or all 
services or by contracting with a private organization. The Tribe is 
responsible for ensuring that the designated agency and those entities 
with which the designated agency has contracts or agreements comply 
with the requirements of 455(f) and these regulations.

What must a Tribe or Tribal organization include in a Tribal CSE plan 
in order to demonstrate capacity to operate a Tribal CSE program? 
(Section 309.65)

    We are proposing that at the time of its application, a Tribe or 
Tribal organization may demonstrate capacity to operate a Tribal CSE 
program either under proposed paragraph (a) or proposed paragraph (b). 
Proposed paragraph (a) lists all the requirements a Tribe or Tribal 
organization must meet in order to operate a full service child support 
program under section 455(f) of the Act. Proposed paragraph (b) 
describes the requirements a Tribe or Tribal organization must meet in 
order to receive ``start-up'' funding under section 455(f) to develop a 
program meeting all the requirements specified in paragraph (a).
    In proposed paragraph (a), a Tribe or Tribal organization may 
demonstrate the capacity to operate a Tribal CSE program meeting the 
objectives of title IV-D of the Act by submission of a Tribal CSE plan 
which meets the following requirements.
    In paragraph (a)(1), we propose that the plan describe the 
population subject to the jurisdiction of the Tribal court or 
administrative agency for child support purposes, as specified under 
Sec. 309.70.
    In paragraph (a)(2), we propose that the plan include procedures 
for accepting all applications for CSE services and providing 
appropriate CSE services, including referral to appropriate agencies. 
OCSE requires that all child support agencies accept applications for 
service from anyone and requires that the child support agency provide 
appropriate services. Issues surrounding jurisdiction are

[[Page 50813]]

complicated and we want to ensure that no one is denied service. So, we 
require that a child support agency, whether Tribal or State, accept 
any application for services and determine the types of services needed 
by the applicant and whether it can provide them. In some cases, e.g., 
where a Tribal court or child support agency has no jurisdiction over 
any of the parties in a case, the only appropriate service may be to 
refer the applicant to an agency that can provide services. The 
``appropriate agencies'' will be either Tribal CSE agencies in another 
jurisdiction, or a State IV-D agency with jurisdiction over the case.
    In paragraph (a)(3), we propose that the plan include assurance 
that the due process rights of the individuals involved will be 
protected in all activities of the Tribal CSE program, including 
establishment of paternity, establishment, modification, and 
enforcement of support orders.
    In paragraph (a)(4), we propose that the plan include 
administrative and management procedures as specified under 
Sec. 309.75.
    In paragraph (a)(5), we propose that the plan include safeguarding 
procedures as specified under Sec. 309.80.
    In paragraph (a)(6), we propose that the plan include assurance 
that the Tribe or Tribal organization will maintain records as 
specified under Sec. 309.85.
    In paragraph (a)(7), we propose that the plan include copies of all 
applicable Tribal laws and regulations as specified under Sec. 309.90.
    In paragraph (a)(8), we propose that the plan include procedures 
for the location of noncustodial parents as specified under 
Sec. 309.95.
    In paragraph (a)(9), we propose that the plan include procedures 
for the establishment of paternity as specified under Sec. 309.100.
    In paragraph (a)(10), we propose that the plan include guidelines 
for the establishment and modification of child support obligations as 
specified under Sec. 309.105.
    In paragraph (a)(11), we propose that the plan include procedures 
for income withholding as specified under Sec. 309.110.
    In paragraph (a)(12), we propose that the plan include procedures 
for the distribution of child support collections as specified under 
Sec. 309.115.
    In paragraph (a)(13), we propose that the plan include procedures 
for intergovernmental case processing as specified under Sec. 309.120.
    The requirements proposed in paragraphs (a)(3)-(a)(13) are the 
basic requirements of a child support enforcement program. These 
fundamental requirements have proven to be critical to successful 
establishment and enforcement of support orders in the State IV-D 
programs. In choosing these requirements, we have drawn from the 
experiences of the programs operating successfully since the inception 
of the Child Support Enforcement program. These requirements will 
ensure that records are secure, protect individuals and their privacy, 
and ensure the minimum necessary level of commonality between Tribal 
and State programs to ensure that we continue to have an efficient and 
effective child support enforcement program across the Nation. A more 
detailed explanation of each of the requirements can be found in the 
proposed sections of the NPRM as indicated above.
    In paragraph (a)(14), we propose that the plan include reasonable 
performance targets for paternity establishment, support order 
establishment, amount of current support to be collected and amount of 
past-due support to be collected.
    Initially, attainment of the performance targets will not be tied 
to funding. The plan must include the performance targets, but funding 
is not contingent upon the targets being met. In the statistical and 
narrative reports required at Sec. 309.170, grantees must report on 
their success in reaching their performance targets. We do not want to 
set arbitrary performance targets for Tribal CSE agencies, and we 
believe that each Tribe or Tribal organization should be able to 
estimate the targets it can attain. We will assure that technical 
assistance is provided to help Tribal CSE programs set and meet 
appropriate performance targets.
    We need more experience with, and information on, operational 
Tribal CSE programs before we determine what performance standards to 
require for them. Within three years of publication of the final rule 
and after Tribal CSE programs have gained experience and had an 
opportunity to gather data on performance, we will have a better 
understanding of what targets are attainable. At that point, we plan to 
work with Tribal CSE agencies to develop and regulate performance 
standards, and to implement requirements for performance standards as 
an important element in Tribal CSE programs. As part of that process, 
we plan to define the relationship between performance standards and 
funding.
    As we develop performance standards for Tribal CSE programs, we 
will look to our experience in establishing performance standards for 
State IV-D programs. We developed these standards over several years, 
in cooperation with States. After enactment of the Government 
Performance and Results Act of 1993, which requires Federal programs to 
set goals and measure results by establishing strategic plans, OCSE and 
States worked together to develop the National Child Support 
Enforcement Strategic Plan. The plan includes goals for States' IV-D 
programs and provides the foundation for building a results-oriented 
framework for these programs. Since the plan's completion in 1995, OCSE 
and States have worked together to develop specific performance 
indicators and related performance standards to be used to measure the 
IV-D program's success in achieving its goals.
    Beyond strategic planning, the use of these performance indicators 
has evolved, and they now serve as the basis for a performance-based 
incentive and penalty system for State child support programs. For 
purposes of incentives, States will be measured on their performance 
levels in the following areas: Paternity establishment; establishment 
of support orders; collections for current support; case collections 
for child support arrearages; and cost-effectiveness. With respect to 
performance penalties, there is a statutory penalty for paternity 
establishment and the Secretary has authority to regulate additional 
performance penalties. We believe that these performance measures are 
essential for ensuring that States are held accountable for maintaining 
efficient and effective child support services for children. We have 
shifted to this outcome-oriented approach to child support enforcement 
program accountability in seeking to balance the Federal government's 
oversight responsibility with States' responsibility for child support 
service delivery and fiscal accountability. This system allows us to 
measure and reward or sanction State performance in terms of outcomes 
for children, replacing a system that for years focused only on 
process.
    In developing performance standards for Tribal CSE programs, we are 
committed to working closely with Tribes--as we worked closely with 
States--to develop performance standards that measure accomplishments 
in meeting the basic functional requirements of Tribal CSE programs. As 
discussed above, we consulted extensively with State IV-D programs to 
reach consensus on performance measures, and we intend to carry out a 
similar process with Tribes. We are specifically seeking comments on 
our approach for developing

[[Page 50814]]

performance standards for Tribal CSE programs.
    In proposed paragraph (b), if a Tribe or Tribal organization is 
unable to satisfy any or all of the requirements specified in paragraph 
(a), it may demonstrate capacity to operate a Tribal CSE program 
meeting the objectives of title IV-D of the Act by submission of a 
Tribal CSE program development plan detailing: (1) With respect to each 
requirement in paragraph (a) that the Tribe or Tribal organization 
currently meets, a description of how the Tribe or Tribal organization 
satisfies the requirement, and (2) with respect to each requirement in 
paragraph (a) that the Tribe or Tribal organization does not currently 
meet, the specific steps the Tribe or Tribal organization will take to 
come into compliance and the time frame associated with each step.
    The Tribal CSE program development plan must demonstrate to the 
satisfaction of the Secretary or designee that the Tribe or Tribal 
organization will have in place a Tribal CSE program that will meet the 
requirements outlined in paragraph (a), within a reasonable, specific 
period of time, not to exceed two years.
    The program development plan should follow the same general format 
as a Tribal CSE plan submitted under Sec. 309.65(a). The program 
development plan should address each element listed in Sec. 309.65(a). 
For those functions that a Tribe or Tribal organization already 
performs, the program development plan should contain the same 
information that we require for a Tribal CSE plan. For those functions 
that a Tribe or Tribal organization currently does not perform, or does 
not perform consistent with the proposed regulation, the program 
development plan must include a description of how the Tribe or Tribal 
organization anticipates performing this function in order to meet the 
requirements of this part, the process the Tribe or Tribal organization 
will follow to achieve this, the milestones that the Tribe or Tribal 
organization will use to mark progress toward being capable of 
performing this function, and the schedule for meeting those 
milestones. In some cases, a Tribe or Tribal organization may not know, 
when it applies, exactly how it will perform one or more required 
functions. In that case, rather than describing how the Tribe or Tribal 
organization will perform the function, the program development plan 
should describe the process the Tribe or Tribal organization will use 
to make this decision, along with milestones and a schedule for this 
process.
    We recognize that some Tribal CSE agencies may need Federal funding 
to move toward a completely operational program and believe that many 
Tribes and Tribal organizations not currently operating child support 
programs are capable of doing so. Section 309.150 of the proposed rule 
provides for ``start-up'' funds to allow Tribes and Tribal 
organizations which have the basic governmental and administrative 
capabilities necessary to run a child support program, to put in place 
over time a program meeting the requirements of section 455(f) and this 
regulation.
    The statute provides that a Tribe or Tribal organization must 
demonstrate that it is capable of running a child support enforcement 
program. We have interpreted this to allow for a reasonable amount of 
time and a reasonable amount of Federal funding to establish a program.
    Before providing CSE start-up funding, we plan to ensure that a 
Tribe or Tribal organization has the basic governmental and 
administrative functions in place that are necessary to support a CSE 
program. This includes such things as an effective accounting system 
and experience in successfully managing other service programs. We 
would view Tribes with these elements in place as capable of running a 
Tribal CSE program when they apply for start-up funding in accordance 
with the requirements of Sec. 309.65(b). We will provide start-up 
funding to Tribes and Tribal organizations whose applications 
demonstrate the reasonable expectation that they will be ready within 
two years to operate a full, comprehensive CSE program.
    However, we do not believe that Congress intended the Department to 
fund start-up activities for an extended period of time or without 
regard to the amount of resources devoted to starting a Tribal program. 
Accordingly, we have proposed to limit start-up funding to an amount 
not to exceed a total of $500,000 in Federal funds for two years 
(except for Tribes and Tribal organizations that receive a waiver of 
the non-Federal share requirement under Sec. 309.130(d)). Based on the 
experience of Tribes of varying sizes and circumstances that have 
started CSE programs, we believe that this amount of time and funding 
will enable Tribes and Tribal organizations to pay reasonable and 
necessary costs to complete start-up activities. For example, during 
year one, a Tribe might recruit, hire and begin to train its CSE 
program staff, and develop the necessary Tribal codes to operate a 
Tribal CSE program. Then, in year two, the Tribe could develop CSE 
systems and procedures, enter into cooperative arrangements with 
State(s) and other local Tribal CSE agencies for the provision of child 
support enforcement services and reach agreements to satisfy any 
remaining requirements for the Tribe to operate its own child support 
enforcement program. We believe that, except in unusual cases, if a 
Tribe or Tribal organization needs more than $500,000 in Federal 
funding or more than two years to begin a CSE program, the Tribe or 
organization would not be capable at this point of starting a CSE 
program. In extraordinary circumstances (for example, a Tribe had 
encountered unexpected delays in establishing its CSE program and was 
almost ready to begin operating a full CSE program at the end of year 
two), HHS would consider extending the period of time during which 
start-up funding will be available to a Tribe or Tribal organization 
and/or increasing the amount of start-up funding provided. Our 
presumption is that in very few cases would the start-up time period be 
extended or the start-up funding be increased.
    We request comments on the appropriate length and maximum amount of 
start-up funding.
    In paragraph (c), we propose that the Secretary or designee will 
cease funding a Tribe or Tribal organization's start-up efforts if that 
Tribe or Tribal organization fails to demonstrate satisfactory progress 
pursuant to Secs. 309.15(b)(2) and 309.25(d) toward putting a full 
program in place. A Tribe or Tribal organization whose start-up efforts 
have been terminated may reapply at a later date once the conditions 
that impeded its progress to implement a Tribal CSE program have been 
rectified.
    The Secretary or designee will make every effort to provide 
assistance to Tribal CSE agencies to meet milestones and to put in 
place full programs pursuant to Sec. 309.65(a). We anticipate providing 
extensive technical assistance to Tribes receiving start-up funding to 
help assure that they develop full CSE programs within two years. We 
anticipate extensive communication (including Tribal submission of 
required reports) with these Tribes, so we will know how they are 
progressing and can increase technical assistance as needed.
    We will treat seriously failure to meet critical milestones or to 
report promptly and fully on progress toward meeting milestones 
pursuant to Sec. 309.65(b). The Secretary will cease funding a Tribal 
CSE agency's start-up efforts if that agency fails to demonstrate 
satisfactory progress toward putting a full program in place. The 
Secretary or designee will

[[Page 50815]]

base this determination on the milestones contained in the Tribal CSE 
agency's program development plan and its progress reports, pursuant to 
Secs. 309.15(b)(2) and 309.25(d), supplemented by Tribal audits and 
OCSE reviews. A Tribe or Tribal organization that the Secretary 
proposes to terminate will be able to ask for reconsideration of the 
Secretary's decision following the procedures in Sec. 309.45 of this 
regulation. A Tribe or Tribal organization whose start-up efforts have 
been terminated may reapply at a later date once the conditions that 
impeded its progress to implement a Tribal CSE program have been 
rectified, regardless of whether it has asked for reconsideration under 
Sec. 309.45. However, our expectation is that only two full years of 
start-up funding in total will be provided to any Tribe, unless the 
Tribe can show extraordinary circumstances that indicate additional 
time is warranted (for example, if a Tribe faced a natural disaster).
    When a Tribe or Tribal organization successfully completes its 
start-up funding period, it would submit an application to operate a 
full CSE program consistent with the requirements in Sec. 309.65(a).
    PRWORA made a number of important new enforcement tools available 
to child support agencies. PRWORA expanded the Federal Parent Locator 
Service (FPLS) which includes the National Directory of New Hires 
(NDNH), containing information from New Hire, Quarterly Wages and 
Unemployment Insurance Compensation reporting; and the Federal Case 
Registry (FCR), containing data about child support cases throughout 
the United States. In addition, the Federal Income Tax Refund Offset 
Program has proven to be a valuable means of collecting child support. 
We believe that Tribes and Tribal organizations' use of these tools 
will greatly improve the effectiveness of their child support 
enforcement programs.
    Therefore, we are proposing to require that Tribes and Tribal 
organizations participate in or make use of the expanded FPLS (new hire 
reporting, quarterly wage reporting, NDNH and the FCR) and the Federal 
Income Tax Refund Offset Program to the extent possible or permitted 
under current law and in accordance with instructions issued by the 
Secretary or designee.
    However, we are proposing to delay the effective date of this 
requirement until such time as the Secretary or designee issues 
guidance outlining the necessary procedures to comply with these 
requirements and to ensure that all Tribes and Tribal organizations 
have at least two years to put these mechanisms in place.
    In proposed paragraph (d), no later than two years from the 
implementation of a Tribal CSE program meeting the requirements 
specified in paragraph (a), or no later than two years after the 
Secretary or designee issues guidance outlining the necessary 
procedures to comply with proposed paragraph (d)(1) through (5), 
whichever is later, a Tribal CSE plan must include requirements 
outlined in paragraphs (d)(1) through (5).
    Within two years of the date that the Secretary approves a Tribe's 
or Tribal organization's plan under paragraph (a), or the issuance of 
guidance outlining the procedures to comply with the proposed 
requirements of paragraph (d), the Tribe must have in place procedures 
meeting those requirements. A Tribe or Tribal organization that applies 
initially under paragraph (b) will have up to two years to develop a 
program that meets the requirements of paragraph (a), Once it meets the 
requirements of paragraph (a), it will have an additional two years (or 
two years from the issuance of guidance outlining the necessary 
procedures to meet the requirements of (d)) to comply with paragraph 
(d).
    The delayed effective date of this requirement does not preclude a 
Tribe or Tribal organization from utilizing these tools earlier. 
However, at the present time the only method for doing so would be 
through a cooperative arrangement with a State. We are committed to 
providing Tribes with direct access to these mechanisms and we are 
working to put in place the necessary processes for doing so. If our 
efforts are delayed, we will delay the implementation deadline 
accordingly. We are specifically soliciting comments on both the two-
year timeframe and for suggestions on how best to provide access.
    We propose in paragraph (d)(1), that a Tribal CSE plan include 
procedures for requiring employers operating in the jurisdiction of the 
Tribe to report information about newly hired employees to the Tribal 
CSE agency in accordance with instructions issued by the Secretary or 
designee.
    We propose in paragraph (d)(2), that a Tribal CSE plan include 
procedures for requiring employers operating in the jurisdiction of the 
Tribe to report wage information on a quarterly basis to the Tribal CSE 
agency in accordance with instructions issued by the Secretary or 
designee.
    We propose in paragraph (d)(3), that a Tribal CSE plan include 
procedures under which the Tribal CSE agency reports new hire and 
quarterly wage information to the National Directory of New Hires in 
accordance with instructions issued by the Secretary or designee.
    We propose in paragraph (d)(4), that a Tribal CSE plan include 
procedures under which the Tribal CSE agency submits CSE cases to the 
Federal Case Registry in accordance with instructions issued by the 
Secretary or designee.
    We propose in paragraph (d)(5), that a Tribal CSE plan include 
procedures for submitting CSE cases to the Federal Income Tax Refund 
Offset Program in accordance with instructions issued by the Secretary 
or designee.
    The three Federal interface requirements of new hire reporting to 
the Tribal CSE agency, reporting to the National Directory of New Hires 
(NDNH), and the submittal of cases to the Federal Case Registry (FCR), 
are similar to requirements recently met by State programs under 
mandates in PRWORA. These tools are important for enforcement of child 
support orders; early indications are that these tools are producing 
dramatic results.
    The Federal Parent Locator Service (FPLS) is a computerized network 
through which child support agencies may request information from a 
variety of sources to find noncustodial parents and/or their income, 
assets or employers for purposes of establishing paternity and securing 
support. PRWORA required the development of an expanded FPLS to improve 
child support agencies' ability to locate child support obligors and to 
establish and enforce child support orders, as well as for other 
specified purposes in title IV-D of the Act. The expanded FPLS is 
housed in the Social Security Administration's National Computer 
Center. The National Computer Center possesses state-of-the-art 
standards for system security and data confidentiality.
    The expanded FPLS includes the National Directory of New Hires 
(NDNH) and a Federal Case Registry (FCR) and maintains the capability 
to seek information from existing (i.e., pre-PRWORA) FPLS data sources, 
including, but not limited to, the Internal Revenue Service, Social 
Security Administration, Department of Defense, and Department of 
Veterans Affairs. The expanded FPLS performs regular cross matches 
between the National Directory of New Hires and the Federal Case 
Registry.
    The NDNH contains three types of information. First, the NDNH 
maintains employment data on newly hired employees (new hire reporting) 
submitted by State Directories of New

[[Page 50816]]

Hires and by Federal agencies. Second, the NDNH maintains quarterly 
wage information on individual employees, including Federal employees. 
Third, the NDNH maintains unemployment compensation claims data. States 
are required to transmit new hire, quarterly wage and unemployment 
compensation claims data electronically to the NDNH. As Tribes and 
Tribal organizations begin to operate their own child support 
enforcement programs under section 455(f) of the Act, the NDNH will 
include information submitted by them, as well.
    The purpose of the NDNH is to maintain a repository of information 
on newly hired employees, and on the earnings and unemployment 
compensation claims data of employees. The purpose of including 
quarterly wage and unemployment compensation claims data in the NDNH is 
to provide child support agencies with the ability to quickly locate 
information on the address of, employment of, and unemployment 
compensation being paid to parents with child support obligations who 
are residing or working in other States. Child support agencies seek to 
locate these parents and their employers to establish or enforce a 
child support order. Quarterly wage and unemployment compensation 
claims data provide information on continuously employed and unemployed 
individuals who would not be located solely by new hire reporting.
    The Federal Case Registry (FCR) is a national registry of 
individuals involved in child support cases, constructed from abstracts 
of child support case and order information that child support agencies 
transmit to the FCR. The FPLS, through a matching process between NDNH 
and the Federal Case Registry, is able to automatically provide child 
support agencies with information on address, employment and 
unemployment compensation claims data on parents owing child support. 
Through internal FCR matching, the FPLS alerts child support agencies 
about other jurisdictions that have cases on the same individual.
    However, the FPLS is designed around fixed network connections 
utilizing direct mainframe to mainframe data transmissions. OCSE is 
looking into alternative mechanisms that would provide Tribes and 
Tribal organizations with communications capabilities and cost-
effective access to FPLS.
    As mentioned in an earlier section of the preamble, the issue of 
access to the FPLS was raised during consultation. There is no legal 
impediment to Tribes and Tribal organizations that receive direct 
funding under section 455(f) of the Act from participating in the FPLS. 
Access to the FPLS by Tribes and Tribal organizations requires some 
degree of automation in that the FPLS is designed to operate using 
electronically transmitted requests, and Tribes and Tribal 
organizations would be required to communicate their requests to, and 
receive responses from, the FPLS electronically. While the FPLS 
currently accepts limited types of physical media, e.g., Reel Tapes, 
Cartridge, this is rapidly changing to electronic transmissions only. 
The FPLS production systems are being programmed to handle only 
electronically transmitted files over OCSE's established networks. This 
is currently how the Federal Case Registry (FCR) and National Directory 
of New Hires (NDNH) are programmed. Programming for requests made 
outside of the electronic network is not planned.
    The FPLS supports Federal to State, State to Federal, and State to 
State transmissions. There are currently two separate networks used for 
hosting FPLS child support transactions. The first network is SSA's 
File Transfer Management System (FTMS), which utilizes closed data 
lines via FTS2000 (generally 56kb lines or less) and a proprietary 
protocol (Connect: Direct) for file transfers. This network supports 
Federal to State and State to Federal file transfers. (SSA will not 
support an expansion of this network.) The second network used is the 
Child Support Enforcement Network (CSENet). CSENet supports State to 
State transmissions where the Federal host system is used to route the 
transmission from and to their destinations. This network is currently 
being upgraded and uses Frame Relay services through AT&T and the 
minimum connection is at 56kb.
    The existing FPLS networks are fixed networks located at State 
sites and may not be suited for communication beyond their current 
configuration. Tribes and Tribal organizations that wish to utilize the 
FPLS before the effective date of the Federal interface requirements 
could choose to enter into cooperative arrangements with State IV-D 
agencies to process requests/responses to and from the FPLS.
    The degree of automation necessary to meet most child support 
functionality is similar if not equivalent to State level child support 
systems. Many of the State level child support system functions 
interface directly with the FCR, NDNH, Federal Income Tax Refund Offset 
and other components of the FPLS. Therefore, State and Federal system 
automation and interfaces are closely developed and closely linked. 
While OCSE is very familiar with the functionality contained in State 
systems and the degree of sophistication of those systems, it has no 
similar experience with automation at the Tribal level. Therefore, it 
will be important that OCSE determine the level of technical 
capabilities at the Tribal level and the technical requirements for a 
Tribal interface directly with OCSE for FPLS exchanges. Until this is 
done, it would be conjecture as to the best method of communicating 
with the Tribes and Tribal organizations and providing direct access to 
the FPLS. We are specifically soliciting comments and suggestions from 
Tribes and Tribal organizations on programs that would facilitate 
access. We are also soliciting comments about resources needed, such as 
staff, equipment, development of procedures, policy, costs, interagency 
agreements and estimated caseload. Without information about the 
current status of various Tribal child support computer systems, it 
would be difficult to accurately plan a schedule for implementation of 
Tribal access to the FPLS.
    After the initial Tribal system assessment, consideration will be 
given to establishing a direct interface with the FPLS. Because it does 
not appear feasible to utilize existing networks for communication with 
the Tribes and Tribal organizations, alternative methods will need to 
be considered. There are several approaches that could be pursued, such 
as: The Internet or Virtual Private Networks (VPN). These alternatives, 
along with others may provide a practical means of communication. 
Additionally, Tribes and Tribal organizations would be expected to meet 
all the transaction specifications required of State systems necessary 
to process their requests. These specifications are technically complex 
and will require comprehensive automation and technical expertise to 
support compliance. It may take Tribes and Tribal organizations several 
years to develop the necessary automation to meet the automation and 
communication requirements.
    The Federal Income Tax Refund Offset Program was established by 
Congress (Pub. L. 97-35) in 1981 and enforces delinquent child support 
obligations by intercepting part or all of an obligor's Federal income 
tax refund. This Federal collection mechanism involves the interaction 
of all State IV-D agencies and three Federal agencies (OCSE, the 
Treasury Department's Financial Management Service, and the Internal 
Revenue Service).
    The Internal Revenue Code at 26 U.S.C 6402(c) does not currently 
allow Tribes to have direct access to the

[[Page 50817]]

Federal Income Tax Refund Offset process. Under current law, Tribal CSE 
cases may be processed under the Federal Income Tax Refund Offset 
Program provided there is an application to the State IV-D agency for 
appropriate services. In such cases, Tribes and States may negotiate 
arrangements under which individual applications for services would be 
sent to the State IV-D agency and the Tribal CSE agency would provide 
the State agency with the information and records necessary to process 
such cases for income tax refund offset. Under these negotiated 
arrangements, States would provide appropriate services consistent with 
section 454(4) of the Act. OCSE will issue instructions regarding these 
arrangements.
    As discussed earlier in this preamble, Sec. 309.10 proposes that, 
in order for a Tribe or Tribal organization to receive Tribal CSE 
funding, there must be at least 100 children under the age of majority 
as defined by Tribal law or code, in the population of the Tribe, or of 
the Tribe(s) authorizing a Tribal organization to operate a CSE program 
on their behalf, subject to the jurisdiction of the Tribal court (or 
courts) or administrative agency (or agencies). In paragraph (e) of 
Sec. 309.65, we propose that, in the initial plan and in any plan 
amendment submitted as a new plan, a Tribe or Tribal organization must 
confirm its eligibility for direct Tribal CSE funding by certifying 
that, as of the date the plan or plan amendment is submitted to the 
Department, the Tribe or Tribal organization meets this minimum 
population requirement.

What provisions governing jurisdiction must a Tribe or Tribal 
organization include in a Tribal CSE plan? (section 309.70)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal CSE plan includes a description 
of the population subject to the jurisdiction of the Tribal court or 
administrative agency for child support enforcement purposes. As 
mentioned earlier, we are requiring a minimum of 100 children under the 
age of majority as defined by Tribal law or code in the population 
under the jurisdiction of the Tribe or Tribes to be served in order to 
apply for and receive direct funding.

What administrative and management procedures must a Tribe or Tribal 
organization include in a Tribal CSE plan? (section 309.75)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal plan includes the following 
minimum administrative and management provisions, and the Secretary or 
designee determines that these provisions are adequate to enable the 
Tribe or Tribal organization to operate an effective and efficient 
Tribal CSE program and otherwise comply with Federal requirements.
    In paragraph (a), we propose that the plan include a description of 
the structure of the agency and the distribution of responsibilities 
within the agency. This includes the responsibility for the functions 
of establishing a plan, overseeing operation of the program and 
evaluating the efficiency and effectiveness of the program, preparing 
required reports and receiving, distributing, disbursing and accounting 
for collections. The plan should include the proposed staffing levels 
for delivery of necessary services, including: intake, establishing 
support obligations, locate, financial assessment, enforcement, 
distribution and collection, program management and financial 
management.
    Many Tribes and Tribal organizations applying for grants under 
other programs will be familiar with the inclusion of management and 
administrative capacity to operate the program in their applications. 
This includes evidence of the Tribe's and Tribal organization's ability 
to operate the program. The plan will outline the management and 
administrative capabilities of the Tribal CSE agency, including 
position descriptions of key personnel and related staffing 
information.
    In paragraph (b), we propose that a plan include procedures under 
which applications for Tribal CSE services are made available to the 
public upon request.
    In paragraph (c), we propose the plan include procedures under 
which the Tribal CSE agency must promptly open a case by establishing a 
case record and determining necessary action. The purpose of this 
provision is to avoid a delay in getting needed services to the 
children.
    In paragraph (d), we propose that the Tribal plan must contain 
procedures to control the use of and account for Federal funds and 
amounts collected on behalf of custodial parents, including assurances 
that the following requirements and criteria to bond employees are in 
effect:
    (1) Procedures under which the Tribal CSE agency will ensure that 
every person, who has access to or control over funds collected under 
the Tribal CSE program, is covered by a bond against loss resulting 
from employee dishonesty.
    (2) The requirement in paragraph (d) applies to every person, who 
as a regular part of his or her employment, receives, disburses, 
handles or has access to support collections.
    (3) The requirements of this section do not reduce or limit the 
ultimate liability of the Tribe or Tribal organization for losses of 
support collection from the Tribal CSE agency's program.
    (4) A Tribe may comply with the requirement in paragraph (d) by 
means of self-bonding established under Tribal law and approved by the 
Secretary or designee.
    In paragraph (e), we propose that the plan include procedures under 
which notice of the amount of any support collected for each month is 
provided to families receiving services under the Tribal CSE plan and 
to the noncustodial parent upon request. Families receiving services 
must receive such notice on a quarterly basis.
    In paragraph (f), we propose that the plan include certification 
that for each year during which the Tribe or Tribal organization 
receives or expends funds pursuant to section 455(f) of the Act and 
this part, it shall comply with the provisions of chapter 75 of title 
31 of the United States Code (the Single Audit Act of 1984, Public Law 
98-502, as amended) and OMB Circular A-133. (The single agency audit 
requirements are included in the grants administration requirements at 
45 CFR 92.26, which include OMB Circular A-133, ``Audits of States, 
Local Governments, and Non-Profit Organizations.'') Tribes and Tribal 
organizations that receive grants from other programs are familiar with 
this requirement, as it pertains to most Federal grant-in-aid funding.

What safeguarding procedures must a Tribe or Tribal organization 
include in a Tribal CSE plan? (section 309.80)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program when its Tribal CSE plan 
includes specific safeguarding provisions. We are proposing that Tribes 
and Tribal organizations be required to include in their Tribal CSE 
plan a description of how they propose to safeguard information 
collected for the purposes of their Tribal CSE program. Because of 
concerns raised during consultation and privacy issues concerning child 
support and tax information, this requirement for safeguarding 
information was added to protect both the Tribe's own information and 
data and information

[[Page 50818]]

and data received from other Tribes, States and the Federal government.
    In proposed paragraph (a), there must be procedures under which the 
use or disclosure of information concerning applicants or recipients of 
child support enforcement services is limited to purposes directly 
connected with the administration of the Tribal CSE program or other 
programs or purposes prescribed by the Secretary.
    In proposed paragraph (b), Tribal CSE safeguarding procedures must 
be consistent with safeguarding provisions in sections 453 and 454 of 
the Act and regulations promulgated pursuant to section 464 of the Act 
and conform to any specific rules or instructions issued by the 
Secretary or designee to assure that requests for and disclosure and 
use of information obtained from the Federal Parent Locator Service and 
the Federal Tax Refund Offset Program are limited only to individuals 
and entities authorized under these sections of the Act for the 
purposes authorized under these sections.
    In paragraph (c), we propose that the plan include procedures under 
which sanctions must be imposed for the unauthorized disclosure of 
information concerning applicants and recipients of child support 
enforcement services as outlined in paragraphs (a) and (b) of this 
section.

What reports and maintenance of records procedures must a Tribe or 
Tribal organization include in a Tribal CSE plan? (section 309.85)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal CSE plan includes procedures for 
maintaining certain records.
    In proposed paragraph (a), the Tribal CSE agency would be required 
to maintain records necessary for proper and efficient operation of the 
program including:
    (1) Applications for support services;
    (2) Records on location of noncustodial parents;
    (3) Records on actions taken to establish paternity and obtain and 
enforce support;
    (4) Records on amounts and sources of support collections and the 
distribution of such collections;
    (5) Records on other costs; and
    (6) Statistical, fiscal and other records necessary for reporting 
and accountability required by the Secretary or designee.
    In paragraph (b), we propose that the retention and custodial 
requirements for these records are prescribed in 45 CFR part 92.
    Maintenance of records is an important aspect in running a child 
support program and accountability to the Federal government and those 
receiving services. The requirement to maintain these records will 
enhance the program, in that reporting will be easier and the Tribal 
CSE agency will be able to track the progress and growth of the 
program.

What governing Tribal law or regulations must a Tribe or Tribal 
organization include in a Tribal CSE plan? (section 309.90)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal CSE plan includes copies of 
Tribal law, code, regulations, and/or other evidence that provides the 
following specific procedures:
    In paragraph (a), we propose that the plan include procedures that 
result in the establishment of paternity for any child up to and 
including at least 18 years of age.
    Age 18 is used only in terms of establishing a child support order. 
This has no bearing on Tribal enrollment, Tribal membership or Tribal 
rights. This imposes no Federal requirement relating to Tribal 
membership.
    In paragraph (b), we propose that the plan include procedures that 
result in establishment and modification of child support obligations.
    In paragraph (c), we propose that the plan include procedures that 
result in the enforcement of child support obligations, including 
requirements that Tribal employers comply with income withholding as 
required under Sec. 309.110.
    In paragraph (d), we propose that the plan include procedures that 
result in location of noncustodial parents.
    In the absence of specific laws and regulations, a Tribe or Tribal 
organization may satisfy this requirement by providing in its plan 
detailed descriptions of such procedures which the Secretary or 
designee determines are adequate to enable the Tribe or Tribal 
organization to meet the performance targets approved by the Secretary.
    We understand that some Tribes may not have written laws in these 
areas. In that case, the Tribe must include in its plan a written 
description of the procedures and criteria it employs to establish 
paternity, establish and modify support orders, or to enforce support 
obligations. During consultation, questions concerning specific State 
enforcement techniques were raised. A Tribe or Tribal organization is 
not prohibited from using all or some of the enforcement tools that 
States are required to use. However, some of these may not be 
appropriate enforcement tools for Tribes and Tribal organizations, 
especially for CSE programs that are in the early stages of 
development.
    One example is license revocation for enforcement of support 
orders. This includes driver's, professional, occupational, and 
recreational licenses of individuals who owe overdue support, or who 
fail to comply with subpoenas or warrants relating to paternity or 
support proceedings. We are aware that not all Tribes issue licenses of 
the type a State is required to revoke. We do not have a comprehensive 
list of licenses issued by each Tribe. Therefore, the use/application 
of this technique is left to the discretion of the Tribe or Tribal 
organization. This is a fairly new requirement for State programs, and 
we have elected not to require it in the NPRM because Tribal CSE 
programs are in the early stages of development.
    However, one specific enforcement technique is required for Tribal 
CSE programs: income withholding as described in Sec. 309.110 and 
discussed later in this preamble. Income withholding is deemed critical 
to successful child support enforcement efforts and accounts for over 
50 percent of all collections in State IV-D programs.
    Some enforcement techniques that a Tribe or Tribal organization may 
wish to use will require the cooperation of a State. For example, 
States are required to revoke certain professional licenses if a parent 
is overdue on his or her support obligation. Some of these licenses may 
be issued by a State. If a Tribe or Tribal organization wants to use 
this tool, it must request that the State revoke the license.
    Many enforcement requirements were added to State IV-D programs 
over time, including requirements for State tax refund offset and for 
reporting child support arrearages to credit bureaus. We will provide 
information to Tribal CSE programs on enforcement tools currently 
available. These tools provide increased potential for enforcing 
support orders and are often helpful in the most egregious cases of 
unpaid support. While we do not expect Tribes to use all available 
tools immediately, we would strongly encourage Tribes to consider an 
array of enforcement mechanisms to best serve their families and expect 
more use as Tribes gain experience.

[[Page 50819]]

    This proposed rule requires that Tribal plans explain how the Tribe 
or Tribal organization will carry out specific CSE requirements, 
including the enforcement tools the Tribe or organization will use, as 
well as requiring use of income withholding. We will provide 
information and technical assistance to Tribal programs on use of 
additional enforcement tools.
    We are requesting copies of all Tribal laws and regulations that 
outline the specific procedures for establishment of paternity; 
establishing and modifying child support obligations; enforcing child 
support obligations and locating noncustodial parents. The Tribal plan 
must contain enough information so that the Secretary can determine 
that appropriate Tribal laws, regulations and procedures are in place 
to ensure paternity and support order establishment and enforcement of 
support obligations as required under section 455(f) of the Act and 
these regulations.

What procedures governing the location of noncustodial parents must a 
Tribe or Tribal organization include in a Tribal CSE plan? (section 
309.95)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal CSE plan includes the following 
provisions governing the location of noncustodial parents.
    Under proposed paragraph (a), in all appropriate cases, the Tribal 
CSE agency must attempt to locate noncustodial parents or sources of 
income and/or assets when location is required to take necessary action 
in a case.
    Under proposed paragraph (b), all sources of information and 
records available to the Tribe or Tribal organization must be used to 
locate noncustodial parents. As defined in Sec. 309.05, location means 
the information concerning the physical whereabouts of the noncustodial 
parent, or the noncustodial parent's employer(s), or other source of 
income or assets, as appropriate, which is sufficient and necessary to 
take the next appropriate action in a case.
    A Tribe or Tribal organization may wish to establish a Parent 
Locator Service, similar to the Parent Locator Services established by 
States. The locator service may utilize a variety of sources, ranging 
from manual to electronic processes for location of a noncustodial 
parent. These tools may include: Local officials and employees 
administering public assistance, general assistance, medical 
assistance, food stamps and social services; relatives and friends of 
the noncustodial parent; current or past employers; the local telephone 
company; the U.S. Postal Service; financial references; unions; 
fraternal organizations; police, parole, and probation records if 
appropriate; and State agencies and departments, as authorized by State 
law, including those departments which maintain records of public 
assistance, wages and employment, unemployment insurance, income 
taxation, driver's licenses, vehicle registration, and criminal records 
and other sources, as appropriate.

What procedures for the establishment of paternity must a Tribe or 
Tribal organization include in a Tribal CSE plan? (section 309.100)

    In paragraph (a), we propose that a Tribe or Tribal organization 
demonstrates capacity to operate a Tribal CSE program meeting the 
objectives of title IV-D of the Act when its Tribal CSE plan includes 
the procedures for the establishment of paternity included in this 
section. In cases in which paternity has not been established, the 
Tribe must include in its Tribal CSE plan the procedures under which 
the Tribal CSE agency will:
    (1) Attempt to establish paternity by the process established under 
Tribal law, code and/or custom; and
    (2) Provide an alleged father the opportunity to voluntarily 
acknowledge paternity.
    We will examine the Tribe's procedures to ensure that the 
objectives of title IV-D are met, paternity is established, due process 
rights are protected, and the children in need of child support 
services receive those services consistent with the requirements of 
these regulations.
    In paragraph (b), we propose that the Tribal CSE agency need not 
attempt to establish paternity in any case involving incest or forcible 
rape, or in any case in which legal proceedings for adoption are 
pending, if, in the opinion of the Tribal CSE agency, it would not be 
in the best interests of the child to establish paternity in this case.
    In paragraph (c), we propose that when genetic testing is used to 
establish paternity, the Tribal CSE agency must identify and use 
accredited laboratories which perform, at reasonable cost, legally and 
medically acceptable genetic tests which tend to identify the father or 
exclude the alleged father.
    The proposed requirements in paragraphs (b) and (c) are based on 
similar requirements for State IV-D agencies.
    During consultation with Tribes, the issue of establishing 
paternity was troublesome for a number of reasons. Some Tribes do not 
use the methods of establishing paternity that are widely used in State 
programs. In some instances, Tribal leaders establish paternity. 
Concerns were raised about religious and ethical objections to genetic 
testing for establishing paternity, and about using non-Tribal 
laboratories for genetic testing. In some Tribes, the question of 
paternity is not as important, because the Tribes are matrilineal. In 
others, paternity may enter into issues concerning Tribal membership 
and other rights and entitlements. We are generally providing Tribal 
CSE agencies discretion on how to establish paternity.
    We believe that current genetic testing technology provides the 
most accurate means to determine the father or exclude the alleged 
father, and that involved individuals therefore should have the 
opportunity to request use of this technology. We also believe that an 
alleged father who questions whether he is the father of a child will 
be more likely to accept the child as his if genetic testing determines 
that he is the father.
    We believe that recent advances in genetic testing technology 
address concerns that some may have about this method. Genetic testing 
is now painless and minimally invasive. Swabs are used to obtain cells 
from the inside cheek surface; blood is not drawn. There are highly 
accurate results based on comparison of DNA from the child, the mother, 
and the alleged father.
    As noted, we propose to require use of accredited laboratories when 
genetic testing is used, to assure the most accurate results possible. 
Tribes should put safeguards in place to assure that genetic (or blood) 
samples are used only as directed by the Tribe. In their agreements 
with the accredited laboratories they choose, they can require that all 
samples must be used only for the specified paternity establishment and 
must be destroyed within a specified period of time. They also can use 
tribally-owned accredited laboratories.
    We request comments regarding paternity establishment, including 
specific comments concerning the best way to assure due process for 
involved individuals while respecting Tribal tradition.

What procedures governing guidelines for the establishment and 
modification of child support obligations must a Tribe or Tribal 
organization include in a Tribal CSE plan? (section 309.105)

    In paragraph (a), we propose that a Tribe or Tribal organization

[[Page 50820]]

demonstrates capacity to operate a Tribal CSE program meeting the 
objectives of title IV-D of the Act when its Tribal CSE plan includes 
the requirements listed below.
    (1) Establishes one set of child support guidelines by law or by 
judicial or administrative action for setting and modifying child 
support obligation amounts;
    (2) Includes a copy of child support guidelines governing the 
establishment and modification of child support obligations; and
    (3) Indicates whether in-kind or non-cash payments of support will 
be permitted and if so, describes the type(s) of in-kind (non-cash) 
support that will be permitted and how such in-kind (non-cash) payments 
will be converted into cash equivalents if necessary.
    The plan must describe how the Tribe or Tribal organization will 
determine a support amount and establish a support order. It must 
describe any Tribal provisions for in-kind support payments; the 
process to track in-kind support payments; and the process for 
translating the in-kind amount to a dollar amount, should the obligor 
move and services are no longer provided by the Tribal CSE agency.
    During consultation, Tribes stressed repeatedly that it may be 
economically and culturally acceptable for noncustodial parents to 
provide in-kind child support. Examples of in-kind child support 
include, but are not limited to, child care, game (e.g., deer or fish 
from hunting and fishing), firewood, or time spent with the child 
teaching him or her traditional and cultural ways. A variety of in-kind 
options are allowable at the Tribe or Tribal organization's discretion.
    In paragraph (b), we propose that the guidelines established under 
paragraph (a) at a minimum must: (1) Take into account the needs of the 
child and the earnings of the noncustodial parent; and (2) be based on 
specific descriptive and numeric criteria and result in a computation 
of the support obligation.
    As mentioned above, the child support guidelines are guidelines 
established by law or judicial or administrative action. The purpose of 
the guidelines is to establish child support orders based upon the 
financial circumstances of the noncustodial parent and the needs of the 
child. Use of the guidelines is required for establishing child support 
obligations. The ``specific descriptive criteria'' must include 
consideration of the noncustodial parent's earnings and the child's 
needs, and may include consideration of such things as the custodial 
parent's earnings, credit for child care expenses; medical expenses; 
seasonal employment of the noncustodial parent; and any other 
appropriate criteria.
    In paragraph (c), we propose that the Tribe or Tribal organization 
must ensure that child support guidelines are reviewed at least every 
three years.
    In paragraph (d), we propose that the Tribe or Tribal organization 
must provide that there shall be a rebuttable presumption, in any 
judicial or administrative proceeding for the award of child support, 
that the amount of the award which would result from the application of 
the guidelines established under paragraph (a) of this section is the 
correct amount of child support to be awarded.
    In paragraph (e), we propose that a written finding or specific 
finding on the record of a judicial or administrative proceeding for 
the award of child support that the application of the guidelines 
established under paragraph (a) of this section would be unjust or 
inappropriate in a particular case shall be sufficient to rebut the 
presumption in that case, as determined under criteria established by 
the Tribe or Tribal organization. Such criteria must take into 
consideration the best interests of the child. Findings that rebut the 
guidelines shall state the amount of support that would have been 
required under the guidelines and include a justification of why the 
order varies from the guidelines. In the interest of flexibility for 
Tribal CSE programs and comparability with State IV-D requirements, we 
included the provision for deviation from the established child support 
guidelines.

What procedures governing income withholding must a Tribe or Tribal 
organization include in a Tribal CSE plan? (section 309.110)

    In proposed paragraph (a), a Tribe or Tribal organization 
demonstrates capacity to operate a Tribal CSE program meeting the 
objectives of title IV-D of the Act when its Tribal CSE plan includes 
copies of Tribal laws providing for the following income withholding 
requirements.
    (1) In the case of each noncustodial parent against whom a support 
order is or has been issued or modified under the Tribal CSE plan, or 
is being enforced under such plan, so much of his or her income as 
defined in section 466(b)(8) of the Act must be withheld as is 
necessary to comply with the order.
    Income is defined in section 466(b)(8) of the Act as ``* * * any 
periodic form of payment due to an individual, regardless of source, 
including wages, salaries, commissions, bonuses, worker's compensation, 
disability, payments pursuant to a pension or retirement program, and 
interest.'' Tribes may add other elements to this definition of income 
for the purposes of income withholding. Tribes may want to include 
allotment payments in the definition of income for withholding 
purposes. Tribes may also want to define winnings from gaming as income 
subject to withholding. Tribes have the discretion to determine whether 
to include winnings from gaming, allotment payments and other 
additional sources of income in the definition of income.
    (2) In addition to the amount to be withheld to pay the current 
month's obligation, the amount withheld must include an amount to be 
applied toward liquidation of any overdue support.
    (3) The total amount to be withheld under paragraphs (a)(1) and (2) 
of this section may not exceed the maximum amount permitted under 
section 303(b) of the Consumer Credit Protection Act (15 U.S.C. 
1673(b)).
    The provision of the Consumer Credit Protection Act (CCPA) at 15 
U.S.C. 1673(b) sets outside limitations on amounts that may be withheld 
for child support enforcement purposes. If an employee is supporting 
his/her spouse or dependent child, other than a spouse or child 
referenced in the income withholding order, 50 percent of disposable 
earnings may be withheld. If the employee is not supporting such a 
spouse or dependent child, 60 percent of the disposable earnings may be 
withheld. These limits increase to 55 percent and 65 percent if the 
employee is 12 or more weeks in arrears.
    A Tribe or Tribal organization may wish to set different limits. 
The limit set by a Tribe or Tribal organization may be lower, but may 
not be higher than the limit set forth in the CCPA. Some States have 
opted for lower limits, such as 50 percent, on income withholdings.
    (4) All income withholding must be carried out in compliance with 
all procedural due process requirements of the Tribe or Tribal 
organization.
    (5) The Tribal CSE agency must have procedures for promptly 
refunding amounts, which have been improperly withheld.
    This provision protects the noncustodial parent from incorrect or 
inaccurate withholdings that could occur, and ensures that procedures 
are in place to refund amounts which have been improperly withheld.
    (6) The Tribal CSE agency must have procedures for promptly 
terminating income withholding in cases where there is no longer a 
current order for

[[Page 50821]]

support and all arrearages have been satisfied.
    In paragraph (b), we propose that to initiate income withholding, 
the Tribal CSE agency must send the noncustodial parent's employer a 
notice using the standard Federal format that includes the information 
listed below.
    (1) The amount to be withheld.
    (2) A requirement that the employer must send the amount to the 
Tribal CSE agency within 7 business days of the date the noncustodial 
parent is paid.
    (3) That the employer must report to the Tribal CSE agency the date 
on which the amount was withheld from the noncustodial parent's income.
    (4) A requirement that, in addition to the amount to be withheld 
for support, the employer may deduct a fee established by the Tribe for 
the employer's administrative costs incurred for each withholding, if 
the Tribe permits a fee to be deducted.
    (5) A requirement that the withholding is binding upon the employer 
until further notice by the Tribe.
    (6) A requirement that if the employer fails to withhold income in 
accordance with the provision of the notice, the employer is liable for 
the accumulated amount the employer should have withheld from the 
noncustodial parent's income.
    (7) A requirement that the employer must notify the Tribe promptly 
when the noncustodial parent terminates employment and provide the 
noncustodial parent's last known address and the name and address of 
the noncustodial parent's new employer, if known.
    The form Order/Notice to Withhold Income for Child Support (OMB No. 
0970-0154) is required in all IV-D cases and in private cases 
established after January 1, 1994 for income withholding. The form 
includes basic identifying information, what amount needs to be 
withheld, and where payments must be remitted.
    In paragraph (c), we propose that the income of the noncustodial 
parent shall become subject to withholding, at the latest, on the date 
on which the payments which the noncustodial parent has failed to make 
under a support order are at least equal to the support payable for one 
month.
    In the State IV-D program, there are provisions for immediate 
income withholding. This means that the income withholding is mandatory 
when the noncustodial parent is employed. We contemplated using this 
same provision for the Tribal CSE program, but we were concerned that 
it would be difficult for Tribes and Tribal organizations operating a 
program to meet such a requirement in all cases. For that reason, we 
are specifically soliciting comments on this aspect of income 
withholding.
    In paragraph (d), we propose that the only basis for contesting a 
withholding is a mistake of fact, which for purposes of this section 
means an error in the amount of current or overdue support or in the 
identity of the alleged noncustodial parent.
    In paragraph (e), we propose that the provisions of this section do 
not apply to that portion of a support obligation that may be satisfied 
in kind.
    In paragraph (f), we propose that Tribal law must provide that the 
employer is subject to a fine to be determined under Tribal law for 
discharging a noncustodial parent from employment, refusing to employ, 
or taking disciplinary action against any noncustodial parent because 
of the withholding.
    Income withholding is the single most effective tool for collecting 
child support from noncustodial parents. Income withholding provides a 
steady income stream to the custodial parent. This procedure accounted 
for 55.8 percent of all collections made in FY 1998. We believe that 
Tribes will find that this is a very effective tool for child support 
enforcement.

What procedures governing the distribution of child support must a 
Tribe or Tribal organization include in a Tribal CSE plan? (section 
309.115)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal plan includes the provisions 
listed below.
    Under proposed paragraph (a), in cases where families receiving 
services from the Tribal CSE program are receiving TANF assistance from 
the State, collected child support must be distributed consistent with 
section 457(a)(1) of the Act.
    Under proposed paragraph (b), in cases where families receiving 
services from the Tribal CSE program are receiving TANF assistance from 
a Tribal TANF program and formerly received assistance under a State 
program funded under title IV-A, child support arrearage collections 
must be distributed consistent with section 457(a)(2) of the Act.
    Under paragraph (c), in cases where families receiving services 
from the Tribal CSE program are receiving TANF assistance from a Tribal 
TANF program and have assigned their rights to child support to the 
Tribe, collected child support up to the amount of Tribal TANF 
assistance received by the family may be retained by the Tribe. Thus, 
in distributing support collected on behalf of a family who has 
assigned support rights to the Tribe, the Tribe would have the option 
of retaining such support for reimbursement of Tribal TANF benefits or 
of passing through support collected in whole or in part to the family 
to help the family move to self-sufficiency. However, as specified 
under 45 CFR 286.155(b)(1) of the Tribal TANF rules, any collected 
child support in excess of the amount of Tribal TANF assistance 
received by the family must be paid to the family.
    Under proposed paragraph (d), in cases where families receiving 
services from the Tribal CSE program formerly assigned support rights 
to the Tribe as a condition of receiving Tribal TANF assistance, the 
Tribe may retain amounts collected above current support as 
reimbursement for past assistance payments made to the family for which 
the Tribe has not been reimbursed. While this is a Tribal option, we 
would urge Tribes to consider the benefit of passing all support 
collected to families that are no longer receiving Tribal TANF as a 
vehicle for maintaining self-sufficiency.
    A Tribe could not retain collections under this paragraph until all 
current support was paid to the family. As under paragraph (c), any 
collected child support in excess of the amount of unreimbursed Tribal 
TANF assistance must be paid to the family.
    With respect to paragraphs (c) and (d), in developing proposed 
policy, we are considering requiring Tribes to distribute retained 
collections to the Tribe and the Federal government for reimbursement 
of the cost of providing assistance (similar to paragraphs (a) and (b) 
when there is an assignment to the State) at a 90/10 match rate 
(reflecting the general rate of cost-sharing). An alternative would 
have been to allow the Tribe to retain all collections or a greater 
proportion of the collections, but this approach raised significant 
issues as well. In addressing this policy, we ask commenters to 
consider the range of complex issues involved in distribution in these 
cases, including the following: Given the lack of statutory guidance in 
this area, is there a justifiable alternative to the 90/10 rate? How 
would distribution work when a Tribal order was based on in-kind 
support by the noncustodial parent? We encourage your comments on this 
approach to distribution policy and the number of complex issues 
needing to be addressed. We are also interested in learning more about 
the potential impact on families

[[Page 50822]]

and on Tribes with respect to any of these issues.
    Under proposed paragraph (e), in cases where families receiving 
services from the Tribal CSE program never received assistance under a 
State or Tribal program funded under title IV-A, all collected child 
support must be paid to the family.
    Concerns were raised during the consultations with respect to 
distribution of child support collections. OCSE has addressed these 
concerns in Action Transmittal OCSE-98-21, dated July 28, 1998. Title 
IV-D contains explicit requirements for distribution of support 
collected, including support assigned to a State under title IV-A of 
the Act. In cases where Indian families are receiving TANF assistance 
under title IV-A from the State, support must be distributed pursuant 
to section 457(a)(1) of the Act. The Tribal CSE agency must forward all 
collections to the State IV-D agency. The State must pay to the Federal 
government the Federal share of the amount collected and may retain or 
distribute to the family the State share of the amount collected.
    However, if as a condition of eligibility for Tribal TANF, an 
Indian applicant assigns his/her right to support to the Tribe, such an 
assignment may be honored by a State IV-D program providing services to 
the Tribal TANF family and support collected distributed accordingly, 
to the Tribal TANF agency. However, there is nothing under Federal law 
that mandates a State honor a request by a custodial parent to send 
support collected to anyone other than the custodial parent. Should 
assignments exist to both the Tribe and State because of current and/or 
past assistance under title IV-A being provided to the family, amounts 
collected must be distributed in a way that is consistent with section 
457 of the Act and these regulations.
    In cases where Indian families never received title IV-A 
assistance, all collected support must be paid to the family, 
consistent with section 457(a)(3) of the Act.

What intergovernmental procedures must a Tribe or Tribal organization 
include in a Tribal CSE plan? (section 309.120)

    We propose that a Tribe or Tribal organization demonstrates 
capacity to operate a Tribal CSE program meeting the objectives of 
title IV-D of the Act when its Tribal CSE plan includes those items 
listed below.
    In paragraph (a), we propose the plan include procedures that 
provide that the Tribal CSE agency will cooperate with States and other 
Tribal CSE agencies to provide CSE services in accordance with 
instructions and requirements issued by the Secretary or designee.
    In paragraph (b), we propose the plan include assurances that the 
Tribe or Tribal organization will recognize child support orders issued 
by other Tribes and Tribal organizations, and by States, in accordance 
with the requirements under 28 U.S.C. 1738B, the Full Faith and Credit 
for Child Support Orders Act.
    As discussed earlier in the preamble, under the Full Faith and 
Credit for Child Support Orders Act, States are required to reciprocate 
and recognize Tribal orders. In addition, all States have enacted the 
Uniform Interstate Family Support Act (UIFSA). This model statute 
provides that, as a matter of State law, States will treat Indian 
Tribes in the same manner as they treat other States when handling 
child support cases involving other jurisdictions. OCSE is developing 
regulations to specifically address the issue of State cooperation with 
Tribal CSE programs, possibly as part of the revisions to the 
regulations at 45 CFR 302.36, Provision of Services in Interstate IV-D 
Cases.
    We considered adding a requirement that Tribes enact the UIFSA or 
similar legislation. However, we were reluctant to impose a requirement 
with the specificity contained in UIFSA. We are specifically soliciting 
comments on whether this model statute or similar model legislation 
written specifically for Tribes would be helpful.
    We will be working with Tribes and States to determine the 
appropriate requirements for cooperation between Tribes and States. We 
will also be working to identify technical assistance to ensure child 
support services for children whose parents live on or off Tribal land. 
The intent is to ensure that both States and Tribes are covered by 
requirements as appropriate. The Secretary or designee will issue 
additional guidance.

Subpart D-Tribal CSE Program Funding

On what basis is Federal funding in Tribal CSE programs determined? 
(section 309.125)

    We propose that Federal funding of Tribal CSE programs be based on 
information contained in the Tribal CSE application, which includes a 
proposed budget, a description of the nature and scope of the Tribal 
CSE program and assurance that the program will be administered in 
conformity with applicable requirements of title IV-D, regulations 
contained in this part and other official issuances of the Department.

How will Tribal CSE programs be funded? (section 309.130)

    In paragraph (a), we propose that Tribal CSE programs generally 
will be funded on an annual basis. A Tribe or Tribal organization 
running a Tribal CSE program will receive a grant at the beginning of 
that Tribe or Tribal organization's program year or budget period in 
the amount of the approved Federal share, to fund the Tribe or Tribal 
organization's program for the next 12 months. (As noted in subpart B, 
a Tribal CSE agency must have submitted an application, including a 
Tribal CSE plan and application forms, and the Department must have 
approved that application in order for a Tribal CSE agency to be 
eligible for direct funding.) In this discussion, we use the term 
``program'' to include those activities associated with putting a 
Tribal CSE program in place, for example, ``start-up costs,'' as well 
as those activities associated with running a fully functional CSE 
program.
    We want to give a Tribe or Tribal organization as much flexibility 
as possible in selecting the 12-month funding cycle that is easiest for 
it to administer. We also want a Tribe or Tribal organization to be 
able to submit its initial application at any time that it is ready to 
do so, irrespective of its preferred funding cycle.
    In order to make that possible, paragraph (b) proposes a special 
provision for an initial grant. We propose that a Tribe or Tribal 
organization may request that its initial Tribal CSE grant award be for 
a period of less than a year (but at least six months) or more than a 
year (but not to exceed 17 months) to enable the Tribe's CSE program 
funding cycle to coincide with the Tribe's desired annual funding.
    For example, a Tribe or Tribal organization whose fiscal year runs 
from July 1 to June 30 may want its CSE program funding cycle to 
coincide with its fiscal year. However, the Tribe or Tribal 
organization may be ready to start its program on February 1. In that 
case, we could issue the initial grant award to allow the Tribe or 
Tribal organization to begin its program on February 1, after the 
Secretary approves the Tribe or Tribal organization's funding 
application. That initial grant period would run from February 1 of the 
current year to June 30 of the following year, that is, for 17 months. 
For the years after this first budget period, funding would be on a 12-
month basis, from July 1 to June 30 for this Tribe or Tribal 
organization.

[[Page 50823]]

    During the consultation process, we received many questions about 
how the funding level for each Tribe would be set, what formula would 
be used, whether we would be making per capita grants, whether Tribes 
and States would have to negotiate Tribal funding levels, etc.
    In paragraph (c), we propose that the Secretary or designee will 
determine the amount of funds that a Tribe or Tribal organization needs 
for reasonable, necessary and allocable costs to operate its Tribal CSE 
program based on information supplied by the Tribe or Tribal 
organization on Standard Form 424 (Application for Federal Assistance), 
Standard Form 424A (Budget Information--Non-Construction Programs), and 
the Tribe or Tribal organization's CSE plan, as reviewed and approved 
by the Secretary or designee. Forms 424 and 424A are part of the 
initial application, as well as part of annual refunding applications.
    Unlike many other ACF Tribal programs, the Tribal CSE program does 
not have a statutory funding formula or a specific or fixed amount to 
be set aside for Tribal CSE grants. Instead, as is the case for 
approved State CSE programs, funding is available as needed in order to 
pay reasonable and necessary costs of operating approved Tribal CSE 
programs.
    Also, unlike the funding for many other ACF Tribal programs, the 
funding for Tribal CSE activities is completely separate from funding 
for State programs. Thus, a Tribe's decision to run its own CSE program 
does not impact a State's CSE program funds. Tribal CSE funding is not 
apportioned from a State's funding.
    We considered a number of funding options for this NPRM. For 
example, we considered basing funding on the Tribe or Tribal 
organization's performance in collecting child support and cost 
effectiveness in administering a CSE program. We also contemplated 
basing funding on cost per child to operate a child support enforcement 
program. However, given that the vast majority of Tribes will be 
developing new programs, we do not yet have adequate information or 
experience to determine appropriate performance and cost effectiveness 
standards.
    We considered setting a cap on certain costs within the Tribal CSE 
programs. We discussed setting a cap on indirect costs that could be 
paid from the CSE grant funds. However, indirect cost rates should be 
implemented as negotiated. We considered setting a cap on court costs, 
but because of our limited knowledge of Tribal court costs and the 
difference among Tribal courts, we decided this would not be 
appropriate at this time. We considered determining the amount of 
Tribal funding based on State IV-D expenditures. We concluded that 
costs for State programs that have been operating for over twenty 
years, and costs for new Tribal programs for Tribes of varying sizes 
and circumstances, are not directly comparable.
    After considering many options, we decided to propose a 90/10 
funding formula for the first three years of operation of a full Tribal 
CSE program under Sec. 309.65(a) encompassing a matching requirement to 
ensure that Tribes and Tribal organizations have a stake in their CSE 
programs. Therefore, Sec. 309.130(d)(1) proposes that during the first 
3 years of operation of a full Tribal CSE program under Sec. 309.65(a), 
HHS provide an amount not to exceed 90 percent of the total approved 
budget of the CSE program described in a Tribe or Tribal organization's 
approved application, and that the Tribe or Tribal organization must 
provide a non-Federal matching share of at least 10 percent of the 
total approved budget of the assisted program, in cash and/or in kind, 
in accordance with the requirements of 45 CFR part 92. Tribal grantees 
may provide a non-Federal (Tribal) share of greater than 10 percent of 
the costs of their CSE programs, at their option. After three years, 
the matching rate for the Federal government would be 80 percent and 20 
percent for the Tribe. However, if the Secretary determines based on 
experience and consultation with Tribes that the 80/20 match rate is 
disruptive to the program and imposes hardship to Tribes, the 
regulations will be revised accordingly.
    States are required to provide a 34 percent cash match to the 
Federal 66 percent, in their CSE programs. Given the economic 
conditions and lack of a tax base for most Tribes, we are aware that a 
34 percent match would be unreasonable for Tribes and Tribal 
organizations.
    At the option of the Tribe or Tribal organization, the non-Federal 
match may be in cash and/or in kind. An example of a countable monetary 
match would be Tribal funds used to pay the salaries of staff operating 
the Tribal CSE program. An example of a countable in-kind match would 
be the fair value of tribally owned office space used for the Tribe's 
CSE program. Proposed paragraph (d)(1) also provides that bona fide 
third-party donated funds and in-kind contributions valued at fair 
market value may satisfy a Tribe or Tribal organization's non-Federal 
share requirement. For example, third-party donations of supplies and 
equipment used for allowable purposes in the Tribal CSE program 
generally could count as a match. However, ``donations'' that are quid 
pro quo or in consideration for Tribal actions, or that primarily 
benefit the donor, cannot be used to satisfy the requirement. For 
example, if a vendor agreed to donate funds or discount the cost of 
supplies, equipment and/or services to a Tribe if the vendor received a 
contract from the Tribe, this ``donation'' could not be used to satisfy 
the non-Federal share requirement.
    To count as matching in a Tribal CSE program, expenditures must be 
allowable and cannot be claimed for matching in another Federal program 
or in another entity's CSE program.
    In general, Federal funds cannot be used to satisfy the non-Federal 
share requirement. For example, services, such as technical assistance, 
provided to or by a Tribe would not be countable if Federal funds were 
used to pay for these services--to pay the person(s) who provided the 
services or to pay other costs associated with the services. As another 
example, a Tribe could not count as its matching requirement the value 
of an item donated by a State to the Tribe, if the State used Federal 
funds to purchase the item (in other words, if the State had claimed 
Federal financial participation for the same item under its CSE 
program).
    However, there are limited circumstances under which funds from 
other Federal programs may be used as matching funds. Grantees may use 
funds from another Federal program only if the statute(s) applicable to 
that program permit their use to meet non-Federal matching requirements 
in other programs, the purposes of the two programs are consistent, and 
the funds have not been used to meet non-Federal matching requirements 
under any other Federal program(s). For example, a Tribe could not 
count Public Law 93-638 funds as matching funds in its Tribal CSE 
program if the purposes of the child support program and the program 
funded by the Public Law 93-638 funds were not consistent and/or if the 
Tribe was counting these funds as matching in another program.
    We believe that some Tribes may not have sufficient resources to 
provide a 10 percent or 20 percent non-Federal matching share. 
Paragraph (d)(2) therefore proposes circumstances under which HHS would 
waive part or all of the matching requirement. A Tribe or Tribal 
organization that lacks sufficient resources to provide a 10 or 20 
percent match would submit a waiver request that includes: (1) A 
statement that it lacks the available resources to meet the

[[Page 50824]]

matching requirement; (2) a statement of the amount of the non-Federal 
share that it requests HHS to waive; (3) the reasons that substantiate 
why it is unable to meet the matching requirement; and (4) 
documentation that reasonable efforts to obtain the non-Federal share 
have been unsuccessful. Evidence of such efforts might include letters 
from possible sources of funding indicating that the requested 
resources are not available for this purpose, or approval of similar 
waivers of non-Federal share requirements in other Federal programs 
such as Head Start. When evaluating waiver requests from Tribal 
organizations, HHS will consider the resources of the organization as 
well as the resources of the Tribes on whose behalf the organization is 
administering the child support program. HHS could require more 
information and documentation as it determines necessary.
    HHS would waive all or part of the non-Federal matching share, as 
appropriate, if it determines that a waiver request meets the 
conditions stated above. A waiver request would be submitted as part of 
the application for Tribal CSE funding, and waivers would be granted 
for the budget period for which the application is made. Waiver 
requests also could be submitted with budget amendment requests.
    These non-Federal share matching and waiver provisions are modeled 
after similar provisions for the Administration for Native Americans 
and Head Start.
    We are specifically seeking comments on our approach to the funding 
of Tribal CSE programs, including the proposed matching requirement.
    In paragraph (e), we propose that a Tribal CSE grantee may request 
an adjustment to increase the approved level of its current budget by 
submitting Standard Form 424 (Application for Federal Assistance) and 
SF 424A (Budget Information--Non-Construction Programs), and explaining 
why it needs to increase its budget. The Tribe or Tribal organization 
should submit this request at least 60 days before additional funds are 
needed, in order to allow the Secretary or designee adequate time to 
review the estimates and issue a revised grant award as appropriate. 
Requests for changes to budget levels are subject to approval by the 
Secretary or designee. If the change in a grantee's budget estimate 
results from a change in the grantee's CSE plan, the grantee also needs 
to submit a plan amendment, in accordance with Sec. 309.25(c) of this 
part, with its request for additional funding. The Secretary or 
designee will review the grantee's request, ask for additional 
information as necessary, and negotiate any appropriate adjustments 
with the grantee. The Secretary or designee must approve the plan 
amendment before approving additional funding.
    The circumstances under which a Tribe or Tribal organization needs 
to send an application or plan amendment to OCSE are summarized below.

    Initial Application: This will contain the SF 424--Application 
for Federal Assistance and SF 424A--Budget Information--Non-
Construction Programs, plus the Tribal CSE agency's plan, as 
described in Sec. 309.15 of these proposed rules. Tribal CSE 
agencies may submit the initial application at any time. The Tribal 
CSE agency will need to indicate on its initial application what 12-
month budget period it prefers. The budget estimate for the initial 
application should be for a period ranging from six to 17 months, 
such that the end of the initial budget period is the same as the 
end of the Tribal CSE agency's preferred budget period. (An example 
of how this works was presented earlier in this preamble.)
    Annual Refunding Application: The refunding application normally 
will contain only the SF 424--Application for Federal Assistance and 
SF 424A--Budget Information--Non-Construction Programs, unless the 
Tribal CSE agency is making changes to its plan or receives funding 
for start-up costs. If the Tribal CSE agency wants to make changes 
to its plan, it needs to submit those changes also, in a plan 
amendment. If it receives funding for start-up costs, it needs to 
include a program progress report on its CSE program activities and 
accomplishments during the current budget period. The refunding 
application is due to OCSE 60 days before the end of the Tribal CSE 
agency's current budget period. For example, if the Tribal CSE 
agency's initial grant expires on June 30, 2001, then the Tribal CSE 
agency should submit its refunding application for the period July 
1, 2001 to June 30, 2002 to OCSE no later than April 30, 2001.
    Application for Additional Funds, with Plan Amendment: A Tribal 
CSE agency should submit an as-needed application when it wants to 
make changes to its approved CSE plan during a budget period, and 
these changes result in a need for additional CSE funds during the 
budget period. These as-needed applications requesting a plan 
amendment and additional funds will contain: An SF-424--Application 
for Federal Assistance and an SF-424A--Budget Information--Non-
Construction Programs reflecting the Tribal CSE agency's revised 
budget request for the current budget period; the plan amendment; 
and an explanation of the reasons the Tribal CSE agency needs the 
increase in funding. They should be submitted at least 60 days 
before the Tribe needs the additional funds.
    Application for Additional Funds (without Plan Amendment): A 
Tribal CSE agency should submit an as-needed application when it 
identifies a need to change its current grant amount but does not 
need to change its plan. These as-needed applications requesting 
additional funds will contain an SF 424--Application for Federal 
Assistance, and an SF 424A--Budget Information--Non-Construction 
Programs, reflecting the Tribal CSE agency's revised budget request 
for the current budget period; and an explanation of the reasons the 
Tribal CSE agency needs the increase in funding. They should be 
submitted at least 60 days before the Tribal CSE agency needs the 
additional funds.
    Plan Amendment (without Application for Additional Funds): As 
noted earlier in this preamble, if a Tribal CSE agency wants to 
change its plan without adjusting the grant amount, it should submit 
its plan amendment request when the change takes place, or in 
anticipation of the change.

    Under paragraph (f), we propose that Tribes and Tribal 
organizations will obtain Federal funds by drawing them down from the 
Department's Payment Management System. The draw down of Federal grant 
funds is subject to the provisions of 45 CFR 92.20 and 92.21.
    During consultation with Tribes, issues relating to access to grant 
funds were of major concern. Several participants in the consultation 
process expressed the desire that Tribes receive funding for Tribal CSE 
programs pursuant to Public Law 103-413, the Indian Self-Determination 
Act Amendments of 1994, which amends Public Law 93-638, the Indian 
Self-Determination and Education Assistance Act. Basically, this would 
allow a Tribal CSE agency to receive a lump sum payment at the 
beginning of the budget period by drawing down the entire funding 
amount from the U.S. Treasury soon after issuance of the grant award. 
This would allow a Tribal CSE agency to earn interest on the funds 
until it used them later for allowable costs under the funding award. 
However, Public Law 93-638 is applicable to certain Department of the 
Interior and Indian Health Service programs. It is not applicable to 
ACF grant programs, including the Tribal CSE program.
    Like many other ACF grant programs, the Tribal CSE program is 
subject to the grant administrative regulations in 45 CFR part 92. This 
requirement is set forth in proposed paragraph (g). Grantee cash 
management practices are governed by the regulations at 45 CFR 92.20 
and 92.21, which require that grantees minimize the time between when 
the grantee draws funds from the Treasury and the time when the grantee 
actually disburses funds for approved program purposes.
    In practice, this would works as follows. If a Tribal CSE agency 
will need funds to cover, for example, a payroll or a payment to a 
contractor, it will contact the Department's Payment Management

[[Page 50825]]

System (PMS) several days before it needs to make the payment. PMS will 
electronically transfer the funds the Tribal CSE agency needs to make 
this payment directly to the Tribal CSE agency's bank. The Tribal CSE 
agency then makes the payment; for example, it issues payroll checks or 
sends a check to its contractor.
    Another concern was delays in issuing grants at the beginning of a 
fiscal year. This often occurs when Congress fails to enact an 
appropriation and instead enacts a continuing resolution. This should 
not be a problem for Tribal CSE grants. Congress appropriates funds for 
CSE activities, including Tribal CSE activities carried out under 
section 455(f) of the Act, in the ``Children and Families Services'' 
appropriation account. This account is unique in that the appropriation 
usually provides funds not just for the current fiscal year, but also 
an ``advance appropriation'' for the first quarter of the next fiscal 
year. For example, the CSE appropriation for FY 1999 also made funds 
available for the first quarter of FY 2000. This means that OCSE will 
be able to make child support funding payments at the beginning of a 
fiscal year, even in the absence of a regular appropriation (for 
example, under a ``continuing resolution''). Also, this proposed rule 
allows a Tribal CSE agency to elect its own funding period. Many Tribes 
have a July 1 to June 30 fiscal year and we expect many Tribes will 
elect to receive funds on that basis.
    Providing the appropriate level of automation is essential to the 
success of Tribal Child Support Enforcement programs. However, OCSE's 
experience with State system development efforts has indicated clearly 
the difficulty in developing such systems. In particular, the costs of 
developing automated CSE systems and the risk of failure in systems 
development efforts warrant careful planning by grantees and close 
oversight by OCSE.
    States are required by statute to have comprehensive Statewide 
automated systems encompassing virtually every facet of their child 
support programs. Such a requirement does not exist in statute for 
Tribes, nor are we proposing to specify by regulation a specific level 
of automation that each Tribal CSE program must have. Rather, we are 
proposing to allow Tribal CSE grantees to acquire a level of automation 
which makes sense for their individual programs and which can be cost-
justified. OCSE anticipates that the appropriate level of automation 
will vary considerably from program to program. For some larger Tribal 
CSE programs, a high level of automation, approaching that of Statewide 
automated CSE systems, may be appropriate and cost-justifiable.
    For other Tribes, the automation of only some processes in their 
program may be the most appropriate and justifiable level of 
automation.
    Because OCSE is not proposing to regulate what aspects of a Tribe's 
CSE program must be automated, these proposed regulations do not 
contain a certification requirement. Instead, OCSE is proposing that 
each Tribe determine what functions need to be automated in order to 
enable the Tribe to have an effective CSE program and to determine what 
enhancements to this basic functionality would be cost-beneficial. 
(However, OCSE reserves the right to review a Tribal CSE agency's 
automation efforts to determine whether they followed the approved 
budget and whether those efforts were effective.) OCSE is especially 
interested in receiving suggestions regarding whether it should mandate 
certain automation requirements for Tribal child support enforcement 
programs.
    For Tribes seeking to make relatively small investments in 
automation, OCSE believes that it can exercise an appropriate level of 
oversight through the budget review and grant-making processes 
described in subpart D of this NPRM. Tribes that seek to acquire ADP 
hardware, software or ADP-related services will be required to identify 
those items in their budget requests submitted with their applications 
or amendments.
    However, OCSE is seeking comments on the appropriate way to provide 
oversight and to foster the success of larger investments in 
automation, especially those that involve the development of new ADP 
systems. OCSE is seeking to strike a balance between an appropriate 
level of oversight, the size of Tribal systems efforts, and 
administrative burden. OCSE is hampered in this by its lack of 
experience in Tribal systems projects and is therefore seeking comments 
on the best way to structure regulations in this area.
    One possibility is to model those regulations on those used for 
States or to incorporate, with appropriate modifications, the State 
regulations in this regulation. State child support systems efforts are 
governed by HHS regulations at 45 CFR part 95, subpart F. These 
regulations specify in detail a rigorous methodology for planning and 
managing system development projects and for securing Federal funding. 
OCSE is considering applying part 95 to Tribal child support systems 
efforts. OCSE is, however, asking for comments on the appropriateness 
of applying 45 CFR part 95 to the Tribal child support program and on 
the modifications that might be necessary or desirable to adapt part 95 
to the Tribal CSE program.

How long do Tribes and Tribal organizations have to obligate and spend 
CSE grant funds? (section 309.135)

    In paragraph (a), we propose that a Tribe or Tribal organization 
must obligate its CSE grant funds by the end of the budget period for 
which they were awarded. Any funds that remain unobligated at the end 
of the budget period for which they were awarded must be returned to 
the Department. A Tribe or Tribal organization must estimate in its 
refunding application any amounts that may be unobligated at the end of 
the current budget period. In its fourth quarter financial report for a 
budget period, a Tribe or Tribal organization must indicate the exact 
amount of any funds that remained unobligated at the end of that budget 
period. The Department will reduce the amount of the Tribe or Tribal 
organization's grant award for the budget period in which any 
unobligated funds were awarded, by the amount that remained unobligated 
at the end of the budget period.
    ``Obligated'' means that the Tribe or Tribal organization would 
have to legally bind itself to pay grant funds to someone else. For 
example, allowing employees to work obligates the Tribe or Tribal 
organization to pay them, so the cost of salaries and wages accrued 
during a budget period represents an obligation. Likewise, a Tribe or 
Tribal organization's signing a contract with a vendor for supplies or 
services obligates the Tribe or Tribal organization to pay the vendor 
upon receipt of those supplies or services, so the contract is an 
obligation.
    For the next budget period, the Department will award to the Tribe 
or Tribal organization the requested or negotiated amount of CSE funds 
that the Tribe or Tribal organization is expected to need to operate 
its program for that budget period--subject to the same obligation 
requirement. This assures that the Tribe or Tribal organization will 
have sufficient funds to operate its Tribal CSE program.
    In paragraph (b), we propose that a Tribe or Tribal organization 
must liquidate obligations by the last day of the 12-month period 
following the budget period for which the funds were awarded and the 
Tribe or Tribal organization obligated the funds, unless the Department 
grants an exemption and extends the time period for

[[Page 50826]]

liquidation. Funds that remain unliquidated after the time period for 
liquidation has expired must be returned to the Department. Tribes and 
Tribal organizations may request an exemption to this rule based on 
extenuating circumstances. A request for an exemption must be sent to 
the OCSE grant officer listed on the grant award and must be made 
before the end of the time period for liquidation; such requests are 
subject to approval by the Department. If any funds remain unliquidated 
at the end of the maximum time period for liquidation, the Department 
will reduce the amount of the Tribe or Tribal organization's grant 
award for the budget period in which any unliquidated funds were 
awarded by the amount that remains unliquidated at the end of the 
liquidation period.
    The proposed rule would require that, in most cases, obligations 
must be liquidated by the last day of the 12-month period following the 
budget period in which the obligation occurs. Liquidate an obligation 
means making a payment or payments that fulfill the obligation. For 
example, issuing payroll checks liquidates the accrued obligation to 
employees to pay them for hours worked. Paying a vendor for goods or 
services delivered liquidates that obligation.
    As an example, a Tribe or Tribal organization might be on a July 1 
to June 30 budget period and it might sign a contract with a vendor for 
supplies on August 1, 2001. It would have until June 30, 2003 to 
liquidate that obligation, i.e., actually pay the vendor. (In this 
example, the obligation occurs during the July 1, 2001 to June 30, 2002 
budget period. The Tribe or Tribal organization has one year from the 
end of that budget period, i.e., until June 30, 2003, to liquidate the 
obligation.) Of course, the terms of the contract may require that the 
Tribe or Tribal organization pay the vendor earlier than that. What we 
are talking about here is the maximum amount of time that the Tribe or 
Tribal organization has to liquidate an obligation.
    We note that the general rule (45 CFR 92.23) is that grantees must 
liquidate obligations within 90 days after the end of a funding period. 
However, our experience with other ACF Tribal programs indicates that 
90 days often is not sufficient time for grantees to liquidate 
obligations, especially obligations arising from contracts. Therefore, 
as 45 CFR 92.23(b) permits, we propose to adopt a longer maximum time 
period for liquidation--one year after the end of a funding period--
consistent with the rules for many other ACF grant programs.
    We believe that having a year to obligate funds and another year to 
liquidate those obligations will cover virtually all circumstances a 
Tribe or Tribal organization is likely to face in operating its 
program. We also believe that having such deadlines provides a 
necessary degree of fiscal discipline and facilitates the Tribe's and 
Tribal organizations and OCSE's ability to monitor the program. 
However, to cover very unusual circumstances, the proposed regulation 
provides that a Tribe or Tribal organization may request a specific 
exception to this rule if it is unable to liquidate an obligation by 
the deadline. This request would have to be made in writing before the 
deadline and would be subject to approval by the Department.
    Any CSE grant funds awarded to a Tribe or Tribal organization that 
have not been liquidated within one year after the end of the funding 
period, or within a longer time period that the Tribe or Tribal 
organization has requested and the Department has approved, must be 
returned to the Federal government. We propose, as discussed under 
Sec. 309.140(c), that Tribes and Tribal organizations must submit a 
liquidation report after the end of the maximum period for liquidation 
of obligations, and this liquidation report should indicate the exact 
amount of any obligations that remained unliquidated at the end of this 
period. The Department will reduce the amount of the Tribe or Tribal 
organization's grant award for the budget period in which the 
unliquidated funds were awarded, by the amount that remained 
unliquidated at the end of the liquidation period. To accomplish this, 
the Department will make a ``negative'' grant award to the Tribe or 
Tribal organization in the amount of the unliquidated funds. In future 
funding periods, the Tribe or Tribal organization will continue to 
receive the amount of Federal funds it is expected to need to operate 
its Tribal CSE program, consistent with its approved Tribal CSE program 
application.
    If a Tribe or Tribal organization enters a multi-year contract or 
other multi-year arrangement, it should make the agreement renewable 
and fundable annually, dependent on the availability of Federal funds. 
The Tribe or Tribal organization should stipulate in any multi-year 
contract that the contract is renewable on an annual basis, and the 
Tribe or Tribal organization should make separate obligations each 
year. By structuring agreements so that funds are obligated one year at 
a time and only are chargeable to the Tribal CSE grant when obligated 
in this way, the Tribe or Tribal organization should be able to meet 
the proposed obligation and liquidation requirements.
    As we have explained, the Tribe or Tribal organization will 
continue to receive 90 or 80 percent of the reasonable, necessary, and 
allocable costs to operate its Tribal CSE program, consistent with its 
approved Tribal CSE application, and the funding amount could be 
renegotiated as appropriate, as part of the budget review and 
negotiation process. However, if a Tribe or Tribal organization has 
large amounts of unobligated and/or unliquidated funds, and/or a Tribe 
or Tribal organization repeatedly fails to liquidate its obligations 
within the allowed time period, this might indicate that the Tribe or 
Tribal organization's financial systems are inadequate and need 
appropriate attention. If a Tribe or Tribal organization repeatedly 
fails to liquidate obligations in a timely way, we would reexamine its 
entire program budget development process and take appropriate steps 
concerning any deficiencies in its financial systems.
    As part of this reexamination, we would carefully analyze the 
Tribe's funding requests, financial and program reports, and audits and 
provide appropriate technical assistance to help the Tribe identify and 
correct any problems. We also would conduct on-site assessments as 
appropriate to examine the Tribe's administrative and financial 
systems. If necessary, we would reduce the Federal funds granted to the 
Tribe for its CSE program consistent with the Tribe's actual pattern of 
obligations in the past.

What are the financial reporting requirements? (section 309.140)

    In paragraph (a), we propose that a Tribe and Tribal organization 
operating a Tribal CSE program must submit a Financial Status Report, 
Standard Form 269, quarterly. The Financial Status Reports for each of 
the first three quarters of the budget period are due 30 days after the 
end of each quarterly reporting period. The Financial Status Report for 
the fourth quarter is due 90 days after the end of the fourth quarter 
of the budget period.
    The SF 269 is a government-wide form used by grantees to report on 
the use of grant funds. We expect that all Tribes and Tribal 
organizations will be familiar with the form and see no need to develop 
an OCSE-specific financial reporting form for Tribal CSE grant funds.
    In paragraph (b), we propose a Tribe or Tribal organization 
operating a Tribal

[[Page 50827]]

CSE program must submit the ``Child Support Enforcement Program: 
Quarterly Report of Collections'' (Form OCSE-34A), or such other report 
as the Secretary or designee may prescribe, quarterly. The reports for 
each of the first three quarters of the budget period are due 30 days 
after the end of each quarterly reporting period. The report for the 
fourth quarter is due 90 days after the end of each budget period.
    The due dates will be the same as the due dates for the quarterly 
financial status report. The OCSE-34A covers the collection and 
disposition of child support collected from non-custodial parents. We 
note that this form is designed for States' use and contains a number 
of entries that may be inapplicable to a Tribal CSE program. OCSE will 
be issuing special instructions for Tribes and Tribal organizations 
using the OCSE-34A. After we gain more experience with the Tribal CSE 
program, we may develop a child support collections form that is 
tailored to Tribal CSE programs.
    In paragraph (c), we propose that a Tribe or Tribal organization 
operating a Tribal CSE program must submit a report on the liquidation 
of its CSE obligations, using the Financial Status Report, Standard 
Form 269. The liquidation report is due 30 days after the end of the 
maximum period for liquidations of obligations, or 30 days after all 
grant funds are liquidated, whichever is earlier.
    In paragraph (d), we propose that the Secretary or designee will 
consider requiring less frequent financial reporting for Tribal CSE 
agencies that submit the required financial reports timely and 
accurately, and establish adequate financial systems and effective 
program operations under the Tribal CSE program.

What costs are allowable charges to Tribal CSE programs carried out 
under Sec. 309.65(a) of this part? (section 309.145)

    In this section, we propose allowable charges to ``full service'' 
Tribal CSE programs carried out under Sec. 309.65(a) of this proposed 
rule. We propose that Federal funds under section 455(f) of the Act are 
available for the direct costs of operating a Tribal CSE program under 
an approved Tribal CSE application, provided that such costs are 
determined by the Secretary or designee to be reasonable, necessary, 
and allocable to the program. Federal funds are also available for 
indirect costs, where applicable, at the appropriate negotiated 
indirect cost rate. Allowable activities and costs would include those 
listed below.
    In paragraph (a), we propose that costs for support enforcement 
services provided to eligible individuals, including parent locator 
services, paternity establishment, and support order establishment, 
modification, and enforcement services, are allowable.
    In paragraph (b), we propose that allowable costs associated with 
the administration of the Tribal CSE program, include but are not 
limited to the activities listed below.
    (1) Establishment and administration of the Tribal CSE program 
plan.
    (2) Monitoring the progress of program development and operations, 
and evaluating the quality, efficiency, effectiveness and scope of 
available support enforcement services.
    (3) Establishment of all necessary agreements with other Tribal, 
State and local agencies or private providers for the provision of 
child support enforcement services in accordance with Procurement 
Standards found in 45 CFR 92.36. These agreements may include:
    (i) Necessary administrative agreements for support services;
    (ii) Use of Tribal, Federal, State and local information resources;
    (iii) Cooperation with courts and law
    enforcement officials;
    (iv) Securing compliance with the requirements of the Tribal CSE 
program plan in operations under any agreements;
    (v) Development and maintenance of systems for fiscal and program 
records and reports required to be made to OCSE based on these records; 
and,
    (vi) Development of cost allocation systems.
    In proposed paragraph (c), allowable costs include establishment of 
paternity, including the activities listed below.
    (1) Establishment of paternity in accordance with Tribal codes or 
custom as outlined in the approved Tribal CSE program plan.
    (2) Reasonable attempts to determine the identity of a child's 
father, such as:
    (i) Investigation;
    (ii) Development of evidence including the use of genetic testing 
performed by accredited laboratories; and
    (iii) Pre-trial discovery.
    (3) Court or administrative or other actions to establish paternity 
pursuant to procedures established by Tribal codes or custom as 
outlined in the approved Tribal CSE program plan;
    (4) Identifying accredited laboratories that perform genetic tests 
(as appropriate); and
    (5) Referrals of cases to another Tribal CSE agency or to a State 
to establish paternity when appropriate.
    In proposed paragraph (d), allowable costs include establishment, 
modification and enforcement of support obligations including the 
activities listed below.
    (1) Investigation, development of evidence and, when appropriate, 
court or administrative actions.
    (2) Determination of the amount of the support obligation 
(including determination of income and allowable in-kind support under 
Tribal CSE guidelines, if appropriate).
    (3) Enforcement of a support obligation including those activities 
associated with collections and the enforcement of court orders, 
administrative orders, warrants, income withholding, criminal 
proceedings, and prosecution of fraud related to child support.
    (4) Investigation and prosecution of fraud related to child and 
spousal
    support.
    In proposed paragraph (e), allowable costs include the collection 
and disbursement of support payments, including the activities listed 
below.
    (1) Establishment and operation of an effective system for making 
collections and identifying delinquent cases and collecting from them.
    (2) Referral of cases to another Tribal CSE agency or to a State 
CSE program for collection when appropriate.
    (3) Making collections for another Tribal CSE program or for a 
State CSE program.
    In proposed paragraph (f), allowable costs include the 
establishment and operation of a Tribal Parent Locator Service (TPLS) 
or agreements for referral of cases to a State PLS, another Tribal PLS 
or to the Federal PLS for location purposes.
    In proposed paragraph (g), allowable costs include activities 
related to requests to State CSE programs for certification of 
collection for Federal Income Tax Refund offset.
    In proposed paragraph (h), allowable costs include establishing and 
maintaining case records.
    In proposed paragraph (i), allowable costs include planning, 
design, development, installation, enhancement and operation of CSE 
computer systems.
    In proposed paragraph (j), allowable costs include staffing and 
equipment that are directly related to operating a Tribal CSE program.
    In proposed paragraph (k), allowable costs include the portion of 
salaries and expenses of a Tribe's chief executive and staff that are 
directly attributable to managing and operating a Tribal CSE program.
    In proposed paragraph (l), allowable costs include the portion of 
salaries and

[[Page 50828]]

expenses of Tribal judges and staff that is directly related to Tribal 
CSE program activities.
    In proposed paragraph (m), allowable costs include service of 
process.
    In proposed paragraph (n), allowable costs include training on a 
short-term basis that is directly related to operating a Tribal CSE 
program.
    In proposed paragraph (o), allowable costs include costs associated 
with obtaining technical assistance that are directly related to 
operating a CSE program, from outside sources, including Tribes, Tribal 
organizations, State agencies, and private organizations and costs 
associated with providing such technical assistance to public entities.
    In proposed paragraph (p), allowable costs also include any other 
reasonable, necessary, and allocable costs with a direct correlation to 
a Tribal CSE program, consistent with the cost principles in OMB 
Circular A-87.
    The list of activities on which Federal funds under section 455(f) 
of the Act may be expended, is similar to the list of allowable 
expenses for State expenditures in our regulations at 45 CFR 304.20. 
This list is not meant to include all possible expenditures that could 
be charged to a Tribe or Tribal organization's CSE grant; making a list 
of every conceivable expenditure would be impossible. Rather, the list 
provides detailed guidelines as to the kinds of expenditures that a 
Tribe or Tribal organization can charge to its CSE grant. We are 
specifically asking for comments regarding any other category of costs 
on which we should provide such guidance.
    One difference from States' allowable costs is in proposed 
Sec. 309.145(k). Generally, States may not charge to Federal grant 
programs salaries attributable to high-ranking State officials, such as 
the Governor or legislators. However, OMB Circular A-87, Attachment B, 
Section 23.b, states: ``For Federally recognized Indian Tribal 
governments and Councils of Governments (COGs), the portion of salaries 
and expenses directly attributable to managing and operating Federal 
programs by the chief executive and his staff is allowable.'' Following 
this guidance, the proposed rule provides that the portion of the 
salaries and expenses of a Tribe's chief executive and staff which are 
directly attributable to managing and operating a Tribal CSE program 
are allowable charges to the Tribal CSE grant.
    One other difference from States' allowable costs is in proposed 
Sec. 309.145(l). In paragraph (l), we propose that the portions of the 
salaries and expenses of Tribal judges and staff that are directly 
related to Tribal CSE programs would be allowable charges to the Tribal 
CSE grant. To the extent that Tribal judges and staff work on matters 
other than those directly related to child support enforcement, their 
time and expenses would have to be cost-allocated among their various 
activities. Only those costs allocable to child support may be charged 
to the Tribal CSE grant.
    Adequate infrastructure is necessary in order for Tribal CSE 
programs to succeed. However, most Tribal courts are severely 
underfunded and understaffed. Tribal CSE responsibilities will make 
significant demands on these very limited Tribal courts. Therefore, to 
assure adequate staffing to carry out Tribal CSE programs, we propose 
that salaries and expenses of Tribal judges and staff that are 
allocable to the Tribal CSE program be allowable costs.
    In the State IV-D program, Federal financial participation is not 
available for costs of compensation of judges or for other judicial 
expenses; judiciary costs are considered under the category of general 
State or local governmental expenses which are incurred as a result of 
general State requirements. States have well-established court systems 
and would be paying the salaries of judges independent of their child 
support programs. During the consultation process, we received many 
requests that we allow both direct and indirect costs to be charged to 
Tribal CSE grants. The proposed rule contains a provision that makes it 
clear that a Tribe or Tribal organization may charge indirect costs 
computed at the applicable negotiated indirect cost rate to its Tribal 
CSE grant. This is consistent with general Federal grant regulations 
and policies. There are three areas related to Tribal CSE grants that 
Tribes and Tribal organizations should explore with the cognizant 
agency responsible for their indirect cost agreement. First, the 
indirect cost agreement may need to be changed to reflect the new 
funding source--the Tribal CSE grant. Second, Tribal CSE grants can 
encompass a variety of activities. Some of those activities may already 
be included in the Tribe's indirect cost pool. In order for those costs 
to be charged directly to the Tribal CSE grant, the Tribe will need to 
remove them from the indirect cost pool. Finally, some transactions 
will fall outside the negotiated indirect cost agreement, for example, 
child support collections and the disbursement of those collections. A 
Tribal CSE grantee cannot charge indirect costs on activities outside 
its negotiated indirect cost agreement. Again, we encourage Tribes and 
Tribal organizations to discuss their Tribal CSE grant and its impact 
on their negotiated indirect cost agreements with the appropriate 
agency.

What costs are allowable charges to Tribal CSE start-up programs 
carried out under Sec. 309.65(b) of this part? (section 309.150)

    In this section, we propose allowable charges to Tribal CSE 
``start-up'' programs carried out under Sec. 309.65(b) of this proposed 
rule. We also propose that Federal funding for a Tribe or Tribal 
organization's start-up program under Sec. 309.65(b) cannot exceed a 
total of $500,000, except that, if the non-Federal share is waived, 
Federal funding for a start-up program cannot exceed a total of 
$555,555. Federal funds are available for both direct start-up costs, 
and for indirect costs, where applicable, at the negotiated indirect 
cost rate.
    Participants in our consultations repeatedly said that many Tribes 
will need program development funding in order to put CSE programs in 
place. Accordingly, the proposed rule provides that initial program 
activities--planning; developing Tribal CSE laws, codes, guidelines, 
systems and procedures; recruiting, hiring and training staff; and 
other approved, reasonable and necessary start-up costs--are allowable.
    Capacity-building start-up funding will enable Tribes and Tribal 
organizations of varying sizes and circumstances to build the necessary 
infrastructure specifically for CSE programs. Based on the experiences 
of currently-operating Tribal CSE programs, we think that a Tribe or 
Tribal organization that receives start-up funding normally would be 
expected to operate a full Tribal CSE program within two years, and 
that a Federal share of $500,000 is an appropriate maximum amount to 
pay reasonable and necessary start-up costs and complete start-up 
activities. A Tribe or Tribal organization could apply for full service 
CSE program funding under Sec. 309.65(a) as soon as it meets the 
requirements of that section.
    A Tribe of Tribal organization must specify the level of necessary 
start-up funding in its application for Tribal CSE start-up funding.
    We propose that Tribes and Tribal organizations receiving start-up 
funding must include a program progress report in their refunding 
applications, and HHS will monitor these grantees. If HHS determines 
that a Tribe or Tribal organization receiving start-up funding is 
making reasonable, satisfactory progress toward operating a full

[[Page 50829]]

program, then start-up funding should continue for a second year if the 
Tribe or Tribal organization requests it. As noted earlier in the 
preamble, in extraordinary circumstances, HHS will consider extending 
the period of time during which start-up funding will be available to a 
Tribe or Tribal organization.
    As indicated earlier, we request comments about the appropriate 
length and maximum amount of start-up funding.

What uses of Tribal CSE program funds are not allowable? (section 
309.155)

    In proposed paragraph (a), Tribal CSE funds may not be used for 
services provided or fees paid by other Federal agencies, or by 
programs funded by other Federal agencies.
    In proposed paragraph (b), Tribal CSE funds may not be used for 
construction and major renovations.
    In proposed paragraph (c), Tribal CSE funds may not be used for any 
expenditures that have been reimbursed by fees collected.
    In proposed paragraph (d), Tribal CSE funds may not be used for 
expenditures for jailing of parents in Tribal CSE program cases.
    In proposed paragraph (e), Tribal CSE funds may not be used for the 
cost of legal counsel for indigent defendants in Tribal CSE program 
actions.
    In proposed paragraph (f), Tribal CSE funds may not be used for the 
cost of a guardian ad litem.
    In proposed paragraph (g), Tribal CSE funds may not be used for all 
other costs that are not reasonable, necessary, and allocable in Tribal 
CSE programs, under the costs principles in OMB Circular A-87.
    Our existing regulations for States (45 CFR 304.23) list a number 
of items whose costs cannot be charged to Federal child support grants 
to States. We are including a similar list of unallowable costs for 
Tribes and Tribal organizations in this proposed rule.
    The proposed rule provides that services or fees paid by other 
Federal agencies or by programs funded by other Federal agencies are 
unallowable, as are any expenditures that have been reimbursed through 
collections. These provisions follow a general principle that grantees 
cannot charge costs against a Federal grant unless they have actually 
incurred the cost themselves. The proposed rule also provides that 
construction and major renovations are unallowable. In general, grant 
funds can be used for construction and renovation only if Congress 
specifically authorizes those uses. The child support statute does not 
provide for this use.
    We propose that expenditures for jailing of parents in Tribal CSE 
cases are unallowable. The child support regulations for States 
prohibit States' charging costs associated with jailing parents who 
fail to pay their child support obligations. The reasoning for States 
is that incarceration is an inherent government function and is not 
unique to child support. Jailing individuals for violations of law or 
procedure--State, Tribal, or local--must be characterized as part of 
the overall general responsibility of State, Tribal, or local 
government and are therefore unallowable. If jail is the penalty for 
violations of Tribal law, its associated expenses should be considered 
general Tribal expenses for which Federal CSE funding is not permitted. 
Establishment and operation of penalties for violations of Tribal law 
is solely the responsibility of Tribal governments and not confined to 
the CSE program. These are costs incurred as part of administering a 
Tribal government and are not appropriately borne by the Federal child 
support grant. Therefore, we decided to propose applying the same 
provision to Tribes.
    The proposed rule also provides that the cost of a guardian ad 
litem appointed by the court to protect the interests of a child in a 
child support case, and the cost of legal counsel for indigent 
defendants, are not allowable. The costs of counsel for indigent 
defendants and for guardians ad litem in IV-D actions are unallowable 
in State IV-D programs as well. The reason for this is that the 
guardian ad litem in a child support case is a representative of the 
child, as an attorney for an indigent defendant is a representative of 
that defendant. While it is in the best interests of the child or 
defendant to have such representation, that representation is 
essentially a private matter (and may also be a general Tribal expense 
that is part of the overall responsibility of Tribal government), as 
opposed to a child support program function. We considered allowing 
Tribes to charge these costs to the Tribal CSE program. Our concern was 
to help ensure that children and parents receive appropriate 
representation in child support hearings and other matters. However, we 
concluded that, as is the case with States, a guardian ad litem or 
attorney is not a CSE programmatic concern, and could not appropriately 
be charged to the Federal child support grant.
    This proposed section specifies that all other costs that are not 
reasonable, necessary, and allocable under the cost principles in OMB 
Circular A-87 are unallowable under Tribal CSE grants.

Subpart E--Accountability and Monitoring

How will OCSE determine if Tribal CSE program funds are appropriately 
expended? (section 309.160)

    We propose that OCSE will rely on audits required by OMB Circular 
A-133, ``Audits of States, Local Governments, and Non-Profit 
Organizations'' and other provisions of 45 CFR 92.26. The Department 
has determined that this program is to be audited as a major program in 
accordance with section 215 (c) of the Circular. The Department may 
also supplement the required audit through reviews or audits conducted 
by its own staff.
    Under OMB Circular A-133, audits include the review of an 
organization's internal control procedures. Thus, such audits are 
expected to look at expenditures made with Federal Tribal CSE grant 
funds and the child support collections of Tribes and Tribal 
organizations operating their own Tribal Child Support programs. OCSE 
will be developing an audit compliance supplement for A-133 audits 
specific to the Tribal CSE program in the future. In addition, OCSE may 
supplement the required audit through reviews or audits conducted by 
OCSE staff.

What recourse does a tribe or tribal organization have to dispute a 
determination to disallow tribal CSE program expenditures? (section 
309.165)

    We propose that if a Tribe or Tribal organization disputes a 
decision to disallow Tribal CSE program expenditures, the grant appeals 
procedures outlined in 45 CFR part 16 are applicable under this part. 
Any notice of disallowance issued by OCSE will inform the Tribe or 
Tribal organization of its appeal rights, the procedures for exercising 
those rights, and the timeframes for doing so.
    The procedures of the Departmental Appeals Board are summarized in 
45 CFR 16.4 as follows: The Departmental Appeals Board's basic process 
is to review the written record (which both parties are given ample 
opportunity to develop), consisting of relevant documents and 
statements submitted by both parties. In addition, the Board may hold 
an informal conference. The informal conference primarily involves 
questioning of the participants by a presiding Board member. 
Conferences may be conducted by conference call. The written record 
review also may be supplemented by a hearing involving an opportunity 
for examining evidence and witnesses, cross-examination, and oral 
argument. A hearing is more expensive

[[Page 50830]]

and time-consuming than a determination on the written record alone or 
with an informal conference. Generally, therefore, the Board will 
schedule a hearing only if the Board determines that there are complex 
issues or material facts in dispute, or that a hearing would otherwise 
significantly enhance the Board's review. Where the amount in dispute 
is $25,000 or less, there are special expedited procedures. In all 
cases, the Board has the flexibility to modify procedures to ensure 
fairness, to avoid delay, and to accommodate the peculiar needs of a 
given case. The Board makes maximum feasible use of preliminary 
informal steps to refine issues and to encourage resolution by the 
parties. The Board also has the capability to provide mediation 
services.

Subpart F--Statistical and Narrative Reporting Requirements

What statistical and narrative reporting requirements apply to tribal 
CSE programs? (section 309.170)

    We propose that Tribes and Tribal organizations must submit 
information and statistics for Tribal CSE program activity and caseload 
and costs for each budget period.
    In paragraph (a), we propose that Tribes and Tribal organizations 
submit the total number of cases, and, of the total number of cases, 
indicate the number that are TANF cases and the number that are non-
TANF cases.
    In paragraph (b), we propose that Tribes and Tribal organizations 
submit the total number of paternities needed and number of paternities 
established.
    In paragraph (c), we propose that Tribes and Tribal organizations 
submit the total number of support orders needed and the total number 
of orders established.
    In paragraph (d), we propose that Tribes and Tribal organizations 
submit the total amount of current support due and collected.
    In paragraph (e), we propose that Tribes and Tribal organizations 
submit the total amount of past-due support owed and the total amount 
collected.
    In paragraph (f), we propose that Tribes and Tribal organizations 
submit a narrative report on activities, accomplishments and progress 
of the program.
    In paragraph (g), we propose that Tribes and Tribal organizations 
submit total costs claimed.
    In paragraph (h), we propose that Tribes and Tribal organizations 
submit the total amount of fees and costs recovered.
    In paragraph (i), we propose that Tribes and Tribal organizations 
submit the total amount of automated data processing (ADP) costs.
    In paragraph (j), we propose that Tribes and Tribal organizations 
submit the total amount of laboratory paternity establishment costs.
    In an effort to minimize the burden on Tribes and Tribal 
organizations, there are minimum reporting requirements. We understand 
that the Tribal measure of success would not necessarily be the same as 
the State measure of success. However, we do believe that this 
information will be helpful to Tribes and Tribal organizations when 
they are contemplating funding requests and anticipating (and tracking) 
growth of the program.
    The Office of Child Support Enforcement is required by law to 
submit an annual report to Congress, which contains certain specific 
statistics. The statistics reported for proposed paragraphs (g)-(j) are 
statistics that will be included in that report.

When are Statistical and Narrative Reports Due? (Section 309.175)

    We propose that a Tribe or Tribal organization must submit Tribal 
CSE program statistical and narrative reports no later than 90 days 
after the end of its budget period. We think that the proposed 90 days 
will give Tribes and Tribal organizations sufficient time to prepare 
and submit the report.

List of Subjects in 45 CFR Part 309

    Child support, grant program--social programs, Indians, Native 
Americans, Tribal Child Support Enforcement programs.

    Dated: July 18, 2000.
Olivia A. Golden,
Assistant, Secretary for Children and Families.
    Approved: July 18, 2000.
Donna E. Shalala,
Secretary, Department of Health and Human Services.
    For the reasons discussed in the preamble, we propose to amend 
title 45 chapter III of the Code of Federal Regulations by adding new 
part 309 to read as follows:

PART 309--TRIBAL CHILD SUPPORT ENFORCEMENT (CSE) PROGRAM

Subpart A--Tribal CSE Program: General Provisions
Sec.
309.01   What does this part cover?
309.05   What definitions apply to this part?
309.10   Who is eligible to apply for Federal funding to operate a 
Tribal CSE program?
Subpart B--Tribal CSE Program Application Procedures
309.15   What is a Tribal CSE program application?
309.20   Who submits a Tribal CSE program application?
309.25   When must a Tribe or Tribal organization submit a Tribal 
CSE program application?
309.30   Where does the Tribe or Tribal organization submit the 
application?
309.35   What are the procedures for approval or disapproval of 
Tribal CSE program applications and plan amendment(s)?
309.40   What is the basis for disapproval of a Tribal CSE program 
application or plan amendment(s)?
309.45   How may a Tribe or Tribal organization request a 
reconsideration of a disapproval action?
309.50   What are the consequences of disapproval of a Tribal CSE 
program application or plan amendment?
Subpart C--Tribal CSE Plan Requirements
309.55   What does this subpart cover?
309.60   Who is ultimately responsible for administration of the 
Tribal CSE program under the Tribal CSE plan?
309.65   What must a Tribe or Tribal organization include in a 
Tribal CSE plan in order to demonstrate capacity to operate a Tribal 
CSE program?
309.70   What provisions governing jurisdiction must a Tribe or 
Tribal organization include in a Tribal CSE plan?
309.75   What administrative and management procedures must a Tribe 
or Tribal organization include in a Tribal CSE plan?
309.80   What safeguarding procedures must a Tribe or Tribal 
organization include in a Tribal CSE plan?
309.85   What reports and maintenance of records procedures must a 
Tribe or Tribal organization include in a Tribal CSE plan?
309.90   What governing Tribal law or regulations must a Tribe or 
Tribal organization include in a Tribal CSE plan?
309.95   What procedures governing the location of noncustodial 
parents must a Tribe or Tribal organization include in a Tribal CSE 
plan?
309.100   What procedures for the establishment of paternity must a 
Tribe or Tribal organization include in a Tribal CSE plan?
309.105   What procedures governing guidelines for the establishment 
and modification of child support obligations must a Tribe or Tribal 
organization include in a Tribal CSE plan?
309.110   What procedures governing income withholding must a Tribe 
or Tribal organization include in a Tribal CSE plan?
309.115   What procedures governing the distribution of child 
support must a Tribe or Tribal organization include in a Tribal CSE 
plan?
309.120   What intergovernmental procedures must a Tribe or Tribal

[[Page 50831]]

organization include in a Tribal CSE plan?
Subpart D--Tribal CSE Program Funding
309.125   On what basis is Federal funding in Tribal CSE programs 
determined?
309.130   How will Tribal CSE programs be funded?
309.135   How long do Tribes and Tribal organizations have to 
obligate and spend CSE grant funds?
309.140   What are the financial reporting requirements?
309.145   What costs are allowable charges to Tribal CSE programs 
carried out under Sec. 309.65(a) of this part?
309.150   What costs are allowable charges to Tribal CSE start-up 
programs carried out under Sec. 309.65(b) of this part?
309.155   What uses of Tribal CSE program funds are not allowable?
Subpart E--Accountability and Monitoring
309.160   How will OCSE determine if Tribal CSE program funds are 
appropriately expended?
309.165   What recourse does a Tribe or Tribal organization have to 
dispute a determination to disallow Tribal CSE program expenditures?
Subpart F--Statistical and Narrative Reporting Requirements
309.170   What statistical and narrative reporting requirements 
apply to Tribal CSE programs?
309.175   When are statistical and narrative reports due?

    Authority: 42 U.S.C. 655(f), 1302.

Subpart A--Tribal CSE Program: General Provisions


Sec. 309.01  What does this part cover?

    (a) The regulations in this part prescribe the rules for 
implementing section 455(f) of the Social Security Act. Section 455(f) 
authorizes direct grants to Indian Tribes and Tribal organizations to 
operate child support enforcement programs.
    (b) These regulations establish the requirements that must be met 
by Indian Tribes and Tribal organizations to be eligible for grants 
under section 455(f). They establish requirements for: Tribal CSE plan 
and application content, submission, approval, and amendment; program 
funding; program operation; uses of funds; accountability; reporting; 
and other program requirements and procedures.


Sec. 309.05  What definitions apply to this part?

    The following definitions apply to this part:
    ACF means the Administration for Children and Families, Department 
of Health and Human Services.
    Act means the Social Security Act, unless otherwise specified.
    Assistant Secretary means the Assistant Secretary for Children and 
Families, Department of Health and Human Services.
    Central office means the central office of the Office of Child 
Support Enforcement.
    CSE services are the services that are required for establishment 
of paternity, establishment, modification, and enforcement of support 
orders, and location of noncustodial parents as required in title IV-D 
of the Act, this rule, and the Tribal CSE plan. In some situations, the 
appropriate service may be for a Tribe or Tribal organization to refer 
an applicant for CSE services to another Tribal CSE agency or a State 
IV-D agency.
    Child support order and child support obligation mean a judgment, 
decree, or order, whether temporary, final or subject to modification, 
issued by a court or an administrative agency of competent 
jurisdiction, for the support and maintenance of a child, including a 
child who has attained the age of majority under the law of the issuing 
jurisdiction, or of the parent with whom the child is living, which 
provides for monetary support, health care, arrearages, or 
reimbursement, and which may include related costs and fees, interest 
and penalties, income withholding, attorneys' fees, and other relief.
    The Department means the Department of Health and Human Services.
    Indian means a person who is a member of an Indian Tribe.
    Indian Tribe and Tribe mean any Indian or Alaska Native Tribe, 
band, nation, pueblo, village, or community that the Secretary of the 
Interior acknowledges to exist as an Indian Tribe and includes in the 
list of Federally recognized Indian Tribal governments as published in 
the Federal Register pursuant to 25 U.S.C. 479a-1.
    Location means information concerning the physical whereabouts of 
the noncustodial parent, or the noncustodial parent's employer(s), and 
other sources of income or assets, as appropriate, which is sufficient 
and necessary to take the next appropriate action in a case.
    Regional office refers to one of the regional offices of the 
Administration for Children and Families.
    Secretary means the Secretary of the Department of Health and Human 
Services.
    Title IV-D refers to the title of the Social Security Act that 
authorizes the Child Support Enforcement Program, including the Tribal 
Child Support Enforcement Program.
    Tribal CSE agency means the organizational unit in the Tribe or 
Tribal organization that has the delegated authority for administering 
or supervising the Tribal CSE program under section 455(f) of the Act.
    Tribal organization means the recognized governing body of any 
Indian Tribe as defined in this part; any legally established 
organization of Indians which is controlled, sanctioned, or chartered 
by such governing body or which is democratically elected by the adult 
members of the Indian community to be served by such organization and 
which includes the maximum participation of Indians in all phases of 
its activities: Provided, That in any case where a contract is let or 
grant made to an organization to perform services benefitting one or 
more Indian Tribes, the approval of each such Indian Tribe shall be a 
prerequisite to the letting or making of such contract or grant.


Sec. 309.10  Who is eligible to apply for Federal funding to operate a 
Tribal CSE program?

    The following are eligible to apply to receive Federal funding to 
operate a Tribal CSE program meeting the requirements of this part:
    (a) An Indian Tribe with at least 100 children under the age of 
majority as defined by Tribal law or code, in the population subject to 
the jurisdiction of the Tribal court or administrative agency.
    (b) A Tribal organization that demonstrates the authorization of 
one or more Indian Tribes to operate a Tribal CSE program on their 
behalf, with a total of at least 100 children under the age of majority 
as defined by Tribal law or code, in the population of the Tribe(s) 
that is subject to the jurisdiction of the Tribal court (or courts) or 
administrative agency (or agencies).

Subpart B--Tribal CSE Program Application Procedures


Sec. 309.15  What is a Tribal CSE program application?

    (a) Initial application. The initial application must include:
    (1) Standard application forms SF 424, Application for Federal 
Assistance, and SF 424A, Budget Information--Non-Construction Programs; 
and
    (2) A Tribal CSE plan--a comprehensive statement meeting the 
requirements of subpart C of this part that describes the capacity of 
the Tribe or Tribal organization to operate a CSE program meeting the 
objectives of title IV-D of the Act, including establishment of 
paternity, establishment, modification, and enforcement of support 
orders, and location of noncustodial parents.

[[Page 50832]]

    (b) Annual refunding applications. (1) Annual refunding 
applications must include standard application forms SF 424, 
Application for Federal Assistance, and SF 424A, Budget Information--
Non-Construction Programs. As appropriate, annual refunding 
applications also may include amendment(s) to the Tribal CSE plan.
    (2) The refunding application of a Tribe or Tribal organization 
receiving start-up funding based on approval of a Tribal CSE plan 
submitted pursuant to Sec. 309.65(b) of this part also must include a 
progress report that describes accomplishments to date in carrying out 
the Tribe or Tribal organization's program development plan, and any 
alterations to the plan and schedule (in addition to the requirements 
in paragraph (b)(1) of this section).
    (c) Additional application requirement for Tribal organizations. 
The application of a Tribal organization must adequately demonstrate 
that each participating Tribe authorizes the Tribal organization to 
operate a Tribal CSE program on its behalf.


Sec. 309.20  Who submits a Tribal CSE program application?

    The authorized representative of the Tribe or Tribal organization 
must sign and submit the Tribal CSE program application.


Sec. 309.25  When must a Tribe or Tribal organization submit a Tribal 
CSE program application?

    (a) The initial application consisting of the Tribal CSE program 
plan that meets the requirements under subpart C of this part, and the 
application and budget information forms (SF 424, Application for 
Federal Assistance, and SF 424A, Budget Information--Non-Construction 
Programs) may be submitted at any time.
    (b) Subsequent refunding applications containing only SF 424, 
Application for Federal Assistance, and SF 424A, Budget Information--
Non-Construction Programs, must be submitted annually at least 60 days 
before the beginning of the next budget period if the Tribe or Tribal 
organization wishes to receive its funding on time.
    (c) If a Tribe or Tribal organization intends to make any 
substantial or material change in any aspect of the Tribal CSE program:
    (1) A Tribal CSE plan amendment must be submitted at the earliest 
reasonable time for approval under Sec. 309.35. The plan amendment must 
describe and, as appropriate, document the changes the Tribe or Tribal 
organization proposes to make to its CSE plan, consistent with the 
requirements under Sec. 309.65.
    (2) Any amendment of an approved Tribal CSE plan may, at the option 
of the Tribe or Tribal organization, be considered as a submission of a 
new Tribal CSE plan. If the Tribe or Tribal organization requests that 
such amendments be so considered, they must be submitted no less than 
90 days before the proposed effective date of the new plan.
    (d) If a Tribe or Tribal organization receives funding based on 
submittal and approval of a Tribal CSE application which includes a 
program development plan under Sec. 309.65(b), a progress report that 
describes accomplishments to date in carrying out the plan and any 
alterations to the plan and schedule must be submitted with the next 
annual refunding request.
    (e) The effective date of a plan amendment may not be earlier than 
the first day of the calendar quarter in which an approvable plan is 
submitted.


Sec. 309.30  Where does the Tribe or Tribal organization submit the 
application?

    Applications must be submitted to the central office of the Office 
of Child Support Enforcement, Attention: Tribal Child Support 
Enforcement Program, 370 L'Enfant Promenade, SW, Washington, DC 20447, 
with a copy to the appropriate regional office.


Sec. 309.35  What are the procedures for approval or disapproval of 
Tribal CSE program applications and plan amendment(s)?

    (a) The Secretary of the Department of Health and Human Services or 
designee will determine whether the Tribal CSE program application or 
Tribal CSE plan amendment submitted for approval conforms to the 
requirements of approval under the Act and these regulations not later 
than the 90th day following the date on which the Tribal CSE 
application or Tribal CSE plan amendment is received by the Secretary 
or designee, unless additional information is needed from the Tribe or 
Tribal organization. The Secretary or designee will notify the Tribe or 
Tribal organization if additional time or information is required to 
determine whether the application or plan amendment may be approved.
    (b) The Secretary or designee will approve the application or 
determine that the application will be disapproved within 45 days of 
receipt of any additional information requested from the Tribe or 
Tribal organization.


Sec. 309.40  What is the basis for disapproval of a Tribal CSE program 
application or plan amendment(s)?

    (a) An application or plan amendment will be disapproved if:
    (1) The Secretary or designee determines that the application or 
plan amendment fails to meet one or more of the requirements set forth 
in this part;
    (2) The Secretary or designee determines that the laws, code, 
regulations, and procedures described in the application or plan 
amendment will not achieve the outcomes consistent with the objectives 
of title IV-D including: Ensuring access to services; paternity 
establishment; support order establishment; basing child support orders 
on the noncustodial parent's ability to pay; collecting support; making 
timely and accurate payments to families; protecting due process 
rights; and protecting security of data;
    (3) The Secretary or designee determines that the application or 
plan amendment is not complete (after the Tribe or Tribal organization 
has had the opportunity to submit the necessary information); or
    (4) The Secretary or designee determines that the requested funding 
is not reasonable and necessary (after the Tribe or Tribal organization 
has had the opportunity to make appropriate adjustments).
    (b) A written Notice of Disapproval of the Tribal CSE program 
application or plan amendment will be sent to the Tribe or Tribal 
organization upon the determination that any of the conditions of 
Sec. 309.40(a) apply. The Notice of Disapproval will include the 
specific reason(s) for disapproval.


Sec. 309.45  How may a Tribe or Tribal organization request a 
reconsideration of a disapproval action?

    (a) A Tribe or Tribal organization may request reconsideration of 
disapproval of a Tribal CSE application or amendment by filing a 
written Request for Reconsideration to the Secretary or designee within 
60 days of the date of the Notice of Disapproval.
    (b) The Request for Reconsideration must include:
    (1) All documentation that the Tribe or Tribal organization 
believes is relevant and supportive of its application or plan 
amendment; and
    (2) A written response to each ground for disapproval identified in 
the Notice of Disapproval, indicating why the Tribe or Tribal 
organization believes its application or plan amendment conforms to the 
requirements for approval specified at Sec. 309.65 and subpart C of 
this part.
    (c) After receiving a Request for Reconsideration, the Secretary or 
designee will hold a conference call or, at the Department's 
discretion, a meeting with the Tribe or Tribal

[[Page 50833]]

organization as part of the reconsideration, to discuss the reasons for 
the Department's disapproval of the application or plan amendment, and 
the Tribe or Tribal organization's response. Within 30 days after 
receipt of a Request for Reconsideration, the Secretary or designee 
will notify the Tribe or Tribal organization of the date and time the 
conference call or meeting will be held.
    (d) A conference call or meeting under Sec. 309.45(c) shall be held 
not less than 30 days nor more than 60 days after the date the notice 
of such call or meeting is furnished to the Tribe or Tribal 
organization, unless the Tribe or Tribal organization agrees in writing 
to another time.
    (e) The Secretary or designee will make a written determination 
affirming, modifying, or reversing disapproval of a Tribal CSE program 
application or plan amendment within 60 days after the conference call 
or meeting is held. This determination upon reconsideration shall be 
the final decision of the Secretary.
    (f) The Secretary or designee's initial determination that a Tribal 
CSE application or plan amendment is not approvable remains in effect 
pending the reconsideration under this part.


Sec. 309.50  What are the consequences of disapproval of a Tribal CSE 
program application or plan amendment?

    (a) If an application submitted pursuant to Sec. 309.25 is 
disapproved, the Tribe or Tribal organization can receive no funding 
under section 455(f) of the Act or this part until a new application is 
submitted and approved.
    (b) If a plan amendment is disapproved, there is no funding for the 
activity proposed in the plan amendment.
    (c) A Tribe or Tribal organization whose application or plan 
amendment has been disapproved may reapply at any time, once it has 
remedied the circumstances that led to disapproval of the application 
or amendment.

Subpart C---Tribal CSE Plan Requirements


Sec. 309.55  What does this subpart cover?

    This subpart defines the Tribal CSE plan provisions which are 
required and which demonstrate that a Tribe or Tribal organization has 
the capacity to operate a child support enforcement program meeting the 
objectives of title IV-D of the Act, including establishment of 
paternity, establishment, modification, and enforcement of support 
orders, and location of noncustodial parents.


Sec. 309.60  Who is ultimately responsible for administration of the 
Tribal CSE program under the Tribal CSE plan?

    (a) Under the Tribal CSE plan, the Tribe or Tribal organization 
shall establish or designate an agency to administer the Tribal CSE 
plan. That agency shall be referred to as the Tribal CSE agency.
    (b) The Tribe or Tribal organization is responsible and accountable 
for the operation of the Tribal CSE program. Except where otherwise 
provided in this part, the Tribal CSE agency need not perform all the 
functions of the Tribal CSE program, so long as the Tribe or Tribal 
organization ensures that all approved functions are carried out 
properly, efficiently and effectively.
    (c) If the Tribe or Tribal organization delegates any of the 
functions of the Tribal CSE program to another Tribe, a State, and/or 
another agency pursuant to a cooperative arrangement, contract, or 
Tribal resolution, the Tribe or Tribal organization is responsible for 
securing compliance with the requirements of the Tribal CSE plan by 
such Tribe, State, or agency. The Tribe or Tribal organization is 
responsible for submitting copies and appending to the Tribal CSE plan 
any agreements, contracts, or Tribal resolutions between the Tribal CSE 
agency and a Tribe, State, or other agency.


Sec. 309.65  What must a Tribe or Tribal organization include in a 
Tribal CSE plan in order to demonstrate capacity to operate a Tribal 
CSE program?

    At the time of its application, a Tribe or Tribal organization may 
demonstrate capacity to operate a Tribal CSE program either under 
paragraph (a) or paragraph (b) of this section.
    (a) A Tribe or Tribal organization may demonstrate capacity to 
operate a Tribal CSE program meeting the objectives of title IV-D of 
the Act by submission of a Tribal CSE plan which meets the requirements 
listed in paragraphs (a)(1) through (14) of this section:
    (1) Describes the population subject to the jurisdiction of the 
Tribal court or administrative agency for child support purposes as 
specified under Sec. 309.70;
    (2) Evidence that the Tribe or Tribal organization has in place 
procedures for accepting all applications for CSE services and 
providing appropriate CSE services, including referral to appropriate 
agencies;
    (3) Assurance that the due process rights of the individuals 
involved will be protected in all activities of the Tribal CSE program, 
including establishment of paternity, and establishment, modification, 
and enforcement of support orders;
    (4) Administrative and management procedures as specified under 
Sec. 309.75;
    (5) Safeguarding procedures as specified under Sec. 309.80;
    (6) Assurance that the Tribe or Tribal organization will maintain 
records as specified under Sec. 309.85;
    (7) Copies of all applicable Tribal laws and regulations as 
specified under Sec. 309.90;
    (8) Procedures for the location of noncustodial parents as 
specified under Sec. 309.95;
    (9) Procedures for the establishment of paternity as specified 
under Sec. 309.100;
    (10) Guidelines for the establishment and modification of child 
support obligations as specified under Sec. 309.105;
    (11) Procedures for income withholding as specified under 
Sec. 309.110;
    (12) Procedures for the distribution of child support collections 
as specified under Sec. 309.115;
    (13) Procedures for intergovernmental case processing as specified 
under Sec. 309.120; and
    (14) Reasonable performance targets for paternity establishment, 
support order establishment, amount of current support to be collected, 
and amount of past due support to be collected.
    (b) If a Tribe or Tribal organization is unable to satisfy any or 
all of the requirements specified in paragraph (a) of this section, it 
may demonstrate capacity to operate a Tribal CSE program meeting the 
objectives of title IV-D of the Act by submission of a Tribal CSE plan 
detailing:
    (1) With respect to each requirement in paragraph (a) of this 
section that the Tribe or Tribal organization currently meets, a 
description of how the Tribe or Tribal organization satisfies the 
requirement; and
    (2) With respect to each requirement in paragraph (a) of this 
section that the Tribe or Tribal organization does not currently meet, 
the specific steps the Tribe or Tribal organization will take to come 
into compliance and the timeframe associated with each step under this 
program development plan. The program development plan must demonstrate 
to the satisfaction of the Secretary or designee that the Tribe or 
Tribal organization will have in place a Tribal CSE program that will 
meet the requirements outlined in paragraph (a) of this section, within 
a reasonable, specific period of time, not to exceed two years.
    (c) The Secretary or designee will cease funding a Tribe or Tribal 
organization's start-up efforts if that Tribe or Tribal organization 
fails to demonstrate satisfactory progress

[[Page 50834]]

pursuant to Secs. 309.15(b)(2) and 309.25(d) toward putting a full 
program in place. A Tribe or Tribal organization whose start-up efforts 
have been terminated may reapply at a later date once the conditions 
that impeded its progress to implement a Tribal CSE program have been 
rectified.
    (d) No later than two years from the implementation of a Tribal CSE 
program meeting the requirements specified in paragraph (a) of this 
section, or no later than two years after the Secretary or designee 
issues guidance outlining the necessary procedures to comply with 
paragraphs (d)(1) through (5) of this section, whichever is later, a 
Tribal CSE plan must include the following:
    (1) Procedures for requiring employers operating in the 
jurisdiction of the Tribe to report information about newly hired 
employees to the Tribal CSE agency in accordance with instructions 
issued by the Secretary or designee;
    (2) Procedures for requiring employers operating in the 
jurisdiction of the Tribe to report wage information on a quarterly 
basis to the Tribal CSE agency in accordance with instructions issued 
by the Secretary or designee;
    (3) Procedures under which the Tribal CSE agency reports new hire 
and quarterly wage information to the National Directory of New Hires 
in accordance with instructions issued by the Secretary or designee;
    (4) Procedures under which the Tribal CSE agency submits CSE cases 
to the Federal Case Registry in accordance with instructions issued by 
the Secretary or designee; and
    (5) Procedures for submitting CSE cases to the Federal Income Tax 
Refund Offset Program in accordance with instructions issued by the 
Secretary or designee.
    (e) In the CSE plan included in its initial application and in any 
plan amendment submitted as a new plan, a Tribe or Tribal organization 
must certify that, as of the date the plan or plan amendment is 
submitted to the Department, there are at least 100 children under the 
age of majority as defined by Tribal law or code, in the population of 
the Tribe, or of the Tribe(s) authorizing the Tribal organization to 
operate a CSE program on their behalf, that is subject to the 
jurisdiction of the Tribal court (or courts) or administrative agency 
(or agencies).


Sec. 309.70  What provisions governing jurisdiction must a Tribe or 
Tribal organization include in a Tribal CSE plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes a description of the population subject to 
the jurisdiction of the Tribal court or administrative agency for child 
support enforcement purposes.


Sec. 309.75  What administrative and management procedures must a Tribe 
or Tribal organization include in a Tribal CSE plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes the following minimum administrative and 
management provisions, and the Secretary or designee determines that 
these provisions are adequate to enable the Tribe or Tribal 
organization to operate an effective and efficient Tribal CSE program 
and otherwise comply with Federal requirements:
    (a) A description of the structure of the agency and the 
distribution of responsibilities within the agency.
    (b) Procedures under which applications for Tribal CSE services are 
made available to the public upon request.
    (c) Procedures under which the Tribal CSE agency must promptly open 
a case by establishing a case record and determining necessary action.
    (d) Procedures to control the use of and to account for Federal 
funds and amounts collected on behalf of custodial parents, including 
assurances that the following requirements and criteria to bond 
employees are in effect:
    (1) Procedures under which the Tribal CSE agency will ensure that 
every person who has access to or control over funds collected under 
the Tribal CSE program is covered by a bond against loss resulting from 
employee dishonesty;
    (2) The requirement in paragraph (d) of this section applies to 
every person who, as a regular part of his or her employment, receives, 
disburses, handles, or has access to support collections;
    (3) The requirements of this section do not reduce or limit the 
ultimate liability of the Tribe or Tribal organization for losses of 
support collections from the Tribal CSE agency's program; and
    (4) A Tribe may comply with the requirements of paragraph (d) of 
this section by means of self-bonding established under Tribal law and 
approved by the Secretary or designee.
    (e) Procedures under which notice of the amount of any support 
collected for each month is provided to families receiving services 
under the Tribal CSE plan and to the noncustodial parent upon request. 
Families receiving services must receive such notice on a quarterly 
basis.
    (f) Certification that for each year during which the Tribe or 
Tribal organization receives or expends funds pursuant to section 
455(f) of the Act and this part, it shall comply with the provisions of 
chapter 75 of Title 31 of the United States Code (the Single Audit Act 
of 1984, Public Law 98-502, as amended) and OMB Circular A-133.


Sec. 309.80  What safeguarding procedures must a Tribe or Tribal 
organization include in a Tribal CSE plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes safeguarding provisions consistent with 
the following and approved by the Secretary or designee:
    (a) Procedures under which the use or disclosure of information 
concerning applicants or recipients of child support enforcement 
services is limited to purposes directly connected with the 
administration of the Tribal CSE program or with other programs or 
purposes prescribed by the Secretary or designee.
    (b) Procedures consistent with safeguarding provisions in sections 
453 and 454 of the Act and regulations promulgated pursuant to section 
464 of the Act and which conform to any specific rules or instructions 
issued by the Secretary or designee to assure that requests for and 
disclosure and use of information obtained from the Federal Parent 
Locator Service and the Federal Tax Refund Offset Program are limited 
only to individuals and entities authorized under these sections of the 
Act for the purposes authorized under these sections.
    (c) Procedures under which sanctions must be imposed for the 
unauthorized disclosure of information concerning applicants and 
recipients of child support enforcement services as outlined in 
paragraphs (a) and (b) of this section.


Sec. 309.85  What reports and maintenance of records procedures must a 
Tribe or Tribal organization include in a Tribal CSE plan?

    (a) A Tribe or Tribal organization demonstrates capacity to operate 
a Tribal CSE program meeting the objectives of title IV-D of the Act 
when its Tribal CSE plan includes procedures for maintaining records 
necessary for proper and efficient operation of the program, including:

[[Page 50835]]

    (1) Applications for support services;
    (2) Records on location of noncustodial parents;
    (3) Records on actions taken to establish paternity and obtain and 
enforce support;
    (4) Records on amounts and sources of support collections and the 
distribution of such collections;
    (5) Records on other costs; and
    (6) Statistical, fiscal, and other records necessary for reporting 
and accountability required by the Secretary or designee.
    (b) The retention and access requirements for these records are 
prescribed at 45 CFR 92.42.


Sec. 309.90  What governing Tribal law or regulations must a Tribe or 
Tribal organization include in a Tribal CSE plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes Tribal law, code, regulations, and/or 
other evidence that provides specific procedures that result in:
    (a) Establishment of paternity for any child up to and including at 
least 18 years of age;
    (b) Establishment and modification of child support obligations;
    (c) Enforcing child support obligations, including requirements 
that Tribal employers comply with income withholding as required under 
Sec. 309.110; and
    (d) Locating noncustodial parents.
    In the absence of specific laws and regulations, a Tribe or Tribal 
organization may satisfy this requirement by providing in its plan 
detailed descriptions of such procedures which the Secretary or 
designee determines are adequate to enable the Tribe or Tribal 
organization to meet the performance targets approved by the Secretary 
or designee.


Sec. 309.95  What procedures governing the location of noncustodial 
parents must a Tribe or Tribal organization include in a Tribal CSE 
plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes the following provisions governing the 
location of noncustodial parents:
    (a) In all appropriate cases, the Tribal CSE agency must attempt to 
locate noncustodial parents or sources of income and/or assets when 
location is required to take necessary action in a case; and
    (b) All sources of information and records reasonably available to 
the Tribe or Tribal organization must be used to locate noncustodial 
parents.


Sec. 309.100  What procedures for the establishment of paternity must a 
Tribe or Tribal organization include in a Tribal CSE plan?

    (a) A Tribe or Tribal organization demonstrates capacity to operate 
a Tribal CSE program meeting the objectives of title IV-D of the Act 
when its Tribal CSE plan includes the procedures that result in the 
establishment of paternity included in this section. For cases in which 
paternity has not been established, the Tribe must include in its 
Tribal CSE plan the procedures under which the Tribal CSE agency will:
    (1) Attempt to establish paternity by the process established under 
Tribal law, code, and/or custom; and
    (2) Provide an alleged father the opportunity to voluntarily 
acknowledge paternity.
    (b) The Tribal CSE agency need not attempt to establish paternity 
in any case involving incest or forcible rape, or in any case in which 
legal proceedings for adoption are pending, if, in the opinion of the 
Tribal CSE agency, it would not be in the best interests of the child 
to establish paternity.
    (c) When genetic testing is used to establish paternity, the Tribal 
CSE agency must identify and use accredited laboratories which perform, 
at reasonable cost, legally and medically acceptable genetic tests 
which tend to identify the father or exclude the alleged father.


Sec. 309.105  What procedures governing guidelines for the 
establishment and modification of child support obligations must a 
Tribe or Tribal organization include in a Tribal CSE plan?

    (a) A Tribe or Tribal organization demonstrates capacity to operate 
a Tribal CSE program meeting the objectives of title IV-D of the Act 
when its Tribal CSE plan:
    (1) Establishes one set of child support guidelines by law or by 
judicial or administrative action for setting and modifying child 
support obligation amounts;
    (2) Includes a copy of child support guidelines governing the 
establishment and modification of child support obligations; and
    (3) Indicates whether in-kind or non-cash payments of support will 
be permitted and if so, describes the type(s) of in-kind (non-cash) 
support that will be permitted and how such in-kind (non-cash) payments 
will be converted into cash equivalents if necessary.
    (b) The guidelines established under paragraph (a) of this section 
must at a minimum:
    (1) Take into account the needs of the child and the earnings and 
income of the noncustodial parent; and
    (2) Be based on specific descriptive and numeric criteria and 
result in a computation of the support obligation.
    (c) The Tribe or Tribal organization must ensure that child support 
guidelines are reviewed at least every three years.
    (d) The Tribe or Tribal organization must provide that there shall 
be a rebuttable presumption, in any judicial or administrative 
proceeding for the award of child support, that the amount of the award 
that would result from the application of the guidelines established 
under paragraph (a) of this section is the correct amount of child 
support to be awarded.
    (e) A written finding or specific finding on the record of a 
judicial or administrative proceeding for the award of child support 
that the application of the guidelines established under paragraph (a) 
of this section would be unjust or inappropriate in a particular case 
shall be sufficient to rebut the presumption in that case, as 
determined under criteria established by the Tribe or Tribal 
organization. Such criteria must take into consideration the best 
interests of the child. Findings that rebut the guidelines must state 
the amount of support that would have been required under the 
guidelines and include a justification of why the order varies from the 
guidelines.


Sec. 309.110  What procedures governing income withholding must a Tribe 
or Tribal organization include in a Tribal CSE plan?

    (a) A Tribe or Tribal organization demonstrates capacity to operate 
a Tribal CSE program meeting the objectives of title IV-D of the Act 
when its Tribal CSE plan includes copies of Tribal laws and regulations 
providing for income withholding under which:
    (1) In the case of each noncustodial parent against whom a support 
order is or has been issued or modified under the Tribal CSE plan, or 
is being enforced under such plan, so much of his or her income as 
defined in section 466(b)(8) of the Act must be withheld as is 
necessary to comply with the order.
    (2) In addition to the amount to be withheld to pay the current 
month's obligation, the amount withheld must include an amount to be 
applied toward liquidation of any overdue support.
    (3) The total amount to be withheld under paragraphs (a)(1) and (2) 
of this section may not exceed the maximum amount permitted under 
section 303(b)

[[Page 50836]]

of the Consumer Credit Protection Act (15 U.S.C. 1673(b)).
    (4) All income withholding must be carried out in compliance with 
all procedural due process requirements of the Tribe or Tribal 
organization.
    (5) The Tribal CSE agency must have procedures for promptly 
refunding amounts which have been improperly withheld.
    (6) The Tribal CSE agency must have procedures for promptly 
terminating income withholding in cases where there is no longer a 
current order for support and all arrearages have been satisfied.
    (b) To initiate income withholding, the Tribal CSE agency must send 
the noncustodial parent's employer a notice using the standard Federal 
form that includes the following:
    (1) The amount to be withheld;
    (2) A requirement that the employer must send the amount to the 
Tribal CSE agency within 7 business days of the date the noncustodial 
parent is paid;
    (3) A requirement that the employer must report to the Tribal CSE 
agency the date on which the amount was withheld from the noncustodial 
parent's income;
    (4) A requirement that, in addition to the amount to be withheld 
for support, the employer may deduct a fee established by the Tribe for 
the employer's administrative costs incurred for each withholding, if 
the Tribe permits a fee to be deducted;
    (5) A requirement that the withholding is binding upon the employer 
until further notice by the Tribe;
    (6) A requirement that, if the employer fails to withhold income in 
accordance with the provision of the notice, the employer is liable for 
the accumulated amount the employer should have withheld from the 
noncustodial parent's income; and
    (7) A requirement that the employer must notify the Tribe promptly 
when the noncustodial parent terminates employment and provide the 
noncustodial parent's last known address and the name and address of 
the noncustodial parent's new employer, if known.
    (c) The income of the noncustodial parent shall become subject to 
withholding, at the latest, on the date on which the payments which the 
noncustodial parent has failed to make under a support order are at 
least equal to the support payable for one month.
    (d) The only basis for contesting a withholding under this section 
is a mistake of fact, which for purposes of this paragraph means an 
error in the amount of current or overdue support or in the identity of 
the alleged noncustodial parent.
    (e) The provisions of this section do not apply to that portion of 
a child support order that may be satisfied in kind.
    (f) Tribal law must provide that the employer is subject to a fine 
to be determined under Tribal law for discharging a noncustodial parent 
from employment, refusing to employ, or taking disciplinary action 
against any noncustodial parent because of the withholding.


Sec. 309.115  What procedures governing the distribution of child 
support must a Tribe or Tribal organization include in a Tribal CSE 
plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes the following requirements:
    (a) In cases where families receiving services from the Tribal CSE 
program are receiving Temporary Assistance for Needy Families (TANF) 
assistance from the State, collected child support must be distributed 
consistent with section 457(a)(1) of the Act;
    (b) In cases where families receiving services from the Tribal CSE 
program are receiving TANF assistance from a Tribal TANF program and 
formerly received assistance under a State program funded under title 
IV-A, child support arrearage collections must be distributed 
consistent with section 457(a)(2) of the Act;
    (c) In cases where families receiving services from the Tribal CSE 
program are receiving TANF assistance from a Tribal TANF program and 
have assigned their rights to child support to the Tribe, collected 
child support up to the amount of Tribal TANF assistance received by 
the family may be retained by the Tribe, and any collected child 
support in excess of the amount of Tribal TANF assistance received by 
the family must be paid to the family;
    (d) In cases where families receiving services from the Tribal CSE 
program formerly received Tribal TANF assistance and assigned their 
right to child support to the Tribe, collected child support above 
current support may be retained by the Tribe as reimbursement for past 
Tribal TANF assistance payments made to the family for which the Tribe 
has not been reimbursed, and any collected child support in excess of 
the amount of unreimbursed Tribal TANF assistance received by the 
family must be paid to the family; and
    (e) In cases where families receiving services from the Tribal CSE 
program never received assistance under a State or Tribal program 
funded under title IV-A, all collected child support must be paid to 
the family.


Sec. 309.120  What intergovernmental procedures must a Tribe or Tribal 
organization include in a Tribal CSE plan?

    A Tribe or Tribal organization demonstrates capacity to operate a 
Tribal CSE program meeting the objectives of title IV-D of the Act when 
its Tribal CSE plan includes:
    (a) Procedures that provide that the Tribal CSE agency will 
cooperate with States and other Tribal CSE agencies to provide CSE 
services in accordance with instructions and requirements issued by the 
Secretary or designee; and
    (b) Assurances that the Tribe or Tribal organization will recognize 
child support orders issued by other Tribes and Tribal organizations, 
and by States, in accordance with the requirements under 28 U.S.C. 
1738B, the Full Faith and Credit for Child Support Orders Act.

Subpart D--Tribal CSE Program Funding


Sec. 309.125  On what basis is Federal funding in Tribal CSE programs 
determined?

    Federal funding of Tribal CSE programs is based on information 
contained in the Tribal CSE application, which includes a proposed 
budget, a description of the nature and scope of the Tribal CSE program 
and which gives assurance that it will be administered in conformity 
with applicable requirements of title IV-D, regulations contained in 
this part, and other official issuances of the Department.


Sec. 309.130  How will Tribal CSE programs be funded?

    (a) General mechanism. Tribal CSE programs will be funded on an 
annual basis. At or just before the beginning of a Tribal grantee's 
program year, OCSE will issue a grant award to the Tribe or Tribal 
organization to operate its Tribal CSE program for the following 12-
month budget period.
    (b) Special provision for initial grant. A Tribe or Tribal 
organization may request that its initial Tribal CSE grant award be for 
a period of less than a year (but at least six months) or more than an 
year (but not to exceed 17 months) to enable its program funding cycle 
to coincide with its desired annual funding cycle.
    (c) Determination of Tribal funding amounts. The Secretary or 
designee will determine the amount of funds that a Tribe or Tribal 
organization needs to

[[Page 50837]]

pay reasonable, necessary, and allocable costs to operate its Tribal 
CSE program, based on information supplied by the Tribe or Tribal 
organization on Standard Form 424 (Application for Federal Assistance), 
Standard Form 424A (Budget Information--Non-Construction Programs), and 
the Tribe or Tribal organization's CSE plan, as reviewed and approved 
by the Secretary or designee. The Secretary or designee will review the 
grantee's request, ask for additional information as necessary, and 
negotiate any appropriate adjustments with the grantee.
    (d) Federal and non-Federal shares. (1)(i) During the first three 
years in which a Tribe or Tribal organization operates a full CSE 
program under Sec. 309.65(a) of this part, the amount of the Federal 
grant will not exceed 90 percent of the total approved budget of the 
assisted program, unless the Secretary or designee has granted a waiver 
pursuant to paragraph (d)(2) of this section. After a Tribe or Tribal 
organization has operated a full CSE program under Sec. 309.65(a) of 
this part for three years, the amount of the Federal grant will not 
exceed 80 percent of the total approved budget of the assisted program, 
unless the Secretary or designee has granted a waiver pursuant to 
paragraph (d)(2) of this section.
    (ii) During the first three years in which a Tribe or Tribal 
organization operates a full CSE program under Sec. 309.65(a) of this 
part, the Tribe or Tribal organization must contribute to its Tribal 
CSE program a non-Federal (Tribal) matching share of at least 10 
percent of the total approved budget of the assisted program, unless 
the Secretary or designee has granted a waiver pursuant to paragraph 
(d)(2) of this section. After a Tribe or Tribal organization has 
operated a full CSE program under Sec. 309.65(a) of this part for three 
years, the Tribe or Tribal organization must contribute to its Tribal 
CSE program a non-Federal (Tribal) matching share of at least 20 
percent of the total approved budget of the assisted program, unless 
the Secretary or designee has granted a waiver pursuant to paragraph 
(d)(2) of this section. The non-Federal share may be provided in cash 
and/or in kind, fairly valued, by the Tribe or Tribal organization and/
or by a third party, in accordance with the requirements of 45 CFR 
92.24 and this part.
    (iii) Donations of funds, and in-kind contributions of property and 
services valued at fair market value, from a third party to a Tribe or 
Tribal organization, may satisfy the non-Federal share requirement. The 
non-Federal share requirement may not be satisfied by:
    (A) Donations for which the donor receives or expects to receive a 
financial or economic benefit;
    (B) Donations intended as consideration for any benefit received 
from the Tribe or Tribal organization;
    (C) Donations whose costs ultimately will be borne by another 
Federal grant; or
    (D) Any other donation which the Secretary or designee determines 
to benefit the donor in a manner inconsistent with 45 CFR part 92.
    (2)(i) A Tribe or Tribal organization that lacks sufficient 
resources to provide a 10 or 20 percent non-Federal matching share may 
request a waiver of part or all of the non-Federal share.
    (ii) Requests for waiver of part or all of the non-Federal matching 
share must be included with initial applications for funding, refunding 
applications, and budget amendment requests, and must contain the 
following:
    (A) A statement that the Tribe or Tribal organization lacks the 
available resources to meet the 10 or 20 percent non-Federal matching 
share;
    (B) A statement of the amount of the non-Federal share that the 
Tribe or Tribal organization requests the Secretary or designee to 
waive;
    (C) A statement of the reasons that the Tribe or Tribal 
organization is unable to meet the non-Federal share requirement; and
    (D) Documentation that reasonable efforts to obtain the non-Federal 
share have been unsuccessful.
    (iii) The Secretary or designee may require submission of 
additional information and documentation as necessary. The Secretary or 
designee will grant a waiver of all or part of the non-Federal matching 
share, as appropriate, if he or she determines that a waiver request 
demonstrates that the Tribe or Tribal organization lacks sufficient 
resources to provide the non-Federal share, has made reasonable but 
unsuccessful efforts to obtain non-Federal share contributions, and has 
provided all required information. Waiver of all or part of the non-
Federal share shall apply only to the budget period for which 
application was made.
    (e) Increase in approved budget. A Tribal CSE grantee may request 
an adjustment to increase the approved level of its current budget by 
submitting Standard Form 424 (Application for Federal Assistance) and 
Standard Form 424A (Budget Information-Non-Construction Programs), and 
explaining why it needs to increase its budget. The Tribe or Tribal 
organization should submit this request at least 60 days before 
additional funds are needed, in order to allow the Secretary or 
designee adequate time to review the estimates and issue a revised 
grant award as appropriate. Requests for changes to budget levels are 
subject to approval by the Secretary or designee. If the change in a 
grantee's budget estimate results from a change in the grantee's CSE 
plan, the grantee also needs to submit a plan amendment in accordance 
with Sec. 309.25(c) of this part, with its request for additional 
funding. The effective date of a plan amendment may not be earlier than 
the first day of the calendar quarter in which an approvable plan is 
submitted in accordance with Sec. 309.25(e). The Secretary or designee 
will review the grantee's request, ask for additional information as 
necessary, and negotiate any appropriate adjustments with the grantee. 
The Secretary or designee must approve the plan amendment before 
approving any additional funding.
    (f) Obtaining Federal funds. Tribes and Tribal organizations will 
obtain Federal funds on a draw down basis from the Department's Payment 
Management System.
    (g) Grant administration requirements. The Tribal CSE program is 
subject to the grant administration regulations under 45 CFR part 92.


Sec. 309.135  How long do Tribes and Tribal organizations have to 
obligate and spend CSE grant funds?

    (a) A Tribe or Tribal organization must obligate its CSE grant 
funds by the end of the budget period for which they were awarded. Any 
funds that remain unobligated at the end of the budget period for which 
they were awarded must be returned to the Department. A Tribe or Tribal 
organization must estimate in its refunding application any amounts 
that may be unobligated at the end of the current budget period. In its 
fourth quarter financial report for a budget period, a Tribe or Tribal 
organization must indicate the exact amount of any funds that remained 
unobligated at the end of that budget period. The Department will 
reduce the amount of the Tribe or Tribal organization's grant award for 
the budget period for which any unobligated funds were awarded by the 
amount that remained unobligated at the end of this budget period.
    (b) A Tribe or Tribal organization must liquidate obligations by 
the last day of the 12-month period following the budget period for 
which the funds were awarded and the Tribe or Tribal organization 
obligated the funds, unless the Department grants an exemption and 
extends the time period for

[[Page 50838]]

liquidation. Funds that remain unliquidated after the time period for 
liquidation has expired must be returned to the Department. Tribes and 
Tribal organizations may request an exemption to this rule based on 
extenuating circumstances. A request for an exemption must be sent to 
the OCSE grants officer listed on the most recent grant award and must 
be made before the end of the time period for liquidation; such 
requests are subject to approval by the Department. If any funds remain 
unliquidated at the end of the maximum time period for liquidation, the 
Department will reduce the amount of the Tribe or Tribal organization's 
grant award for the budget period for which any unliquidated funds were 
awarded, by the amount that remains unliquidated at the end of the 
liquidation period. Repeated failure by a Tribe or Tribal organization 
to liquidate obligations in a timely way would result in the 
Department's reexamination of the program budget development process 
and could result in action to address financial systems deficiencies.


Sec. 309.140  What are the financial reporting requirements?

    (a) A Tribe or Tribal organization operating a Tribal CSE program 
must submit a Financial Status Report, Standard Form 269, quarterly. 
The Financial Status Reports for each of the first three quarters of 
the budget period are due 30 days after the end of each quarterly 
reporting period. The Financial Status Report for the fourth quarter is 
due 90 days after the end of the fourth quarter of each budget period.
    (b) A Tribe or Tribal organization operating a Tribal CSE program 
must submit the ``Child Support Enforcement Program: Quarterly Report 
of Collections'' (Form OCSE-34A), or such other report as the Secretary 
or designee may prescribe, quarterly. The reports for each of the first 
three quarters of the budget period are due 30 days after the end of 
each quarterly reporting period. The report for the fourth quarter is 
due 90 days after the end of the fourth quarter of each budget period.
    (c) A Tribe or Tribal organization operating a Tribal CSE program 
must submit a report on the liquidation of its CSE obligations, using 
the Financial Status Report, Standard Form 269. The liquidation report 
is due 30 days after the end of the maximum period for liquidation of 
obligations, or 30 days after all grant funds are liquidated, whichever 
is earlier.
    (d) The Secretary or designee will consider requiring less frequent 
financial reporting for Tribal CSE agencies that submit the required 
financial reports timely and accurately, and establish adequate 
financial systems and effective program operations under the Tribal CSE 
program.


Sec. 309.145  What costs are allowable charges to Tribal CSE programs 
carried out under Sec. 309.65(a) of this part?

    Federal funds are available for direct costs of operating a Tribal 
CSE program under an approved Tribal CSE application carried out under 
Sec. 309.65(a) of this part, provided that such costs are determined by 
the Secretary or designee to be reasonable, necessary, and allocable to 
the program. Federal funds are also available for indirect costs, where 
applicable, at the appropriate negotiated indirect cost rate. Allowable 
activities and costs include:
    (a) Support enforcement services provided to eligible individuals, 
including: parent locator services; paternity establishment; and 
support order establishment, modification, and enforcement services;
    (b) Administration of the Tribal CSE program, including but not 
limited to the following:
    (1) Establishment and administration of the Tribal CSE program 
plan;
    (2) Monitoring the progress of program development and operations, 
and evaluating the quality, efficiency, effectiveness, and scope of 
available support enforcement services;
    (3) Establishment of all necessary agreements with other Tribal, 
State, and local agencies or private providers for the provision of 
child support enforcement services in accordance with Procurement 
Standards found in 45 CFR 92.36. These agreements may include:
    (i) Necessary administrative agreements for support services;
    (ii) Use of Tribal, Federal, State, and local information 
resources;
    (iii) Cooperation with courts and law enforcement officials;
    (iv) Securing compliance with the requirements of the Tribal CSE 
program plan in operations under any agreements;
    (v) Development and maintenance of systems for fiscal and program 
records and reports required to be made to OCSE based on these records; 
and
    (vi) Development of cost allocation systems;
    (c) Establishment of paternity, including:
    (1) Establishment of paternity in accordance with Tribal codes or 
custom as outlined in the approved Tribal CSE program plan;
    (2) Reasonable attempts to determine the identity of a child's 
father, such as:
    (i) Investigation;
    (ii) Development of evidence including the use of genetic testing 
performed by accredited laboratories; and
    (iii) Pre-trial discovery;
    (3) Court or administrative or other actions to establish paternity 
pursuant to procedures established by Tribal codes or custom as 
outlined in the approved Tribal CSE program plan;
    (4) Identifying accredited laboratories that perform genetic tests 
(as appropriate); and
    (5) Referrals of cases to another Tribal CSE agency or to a State 
to establish paternity when appropriate;
    (d) Establishment, modification, and enforcement of support 
obligations including:
    (1) Investigation, development of evidence and, when appropriate, 
court or administrative actions;
    (2) Determination of the amount of the support obligation 
(including determination of income and allowable in-kind support under 
Tribal CSE guidelines, if appropriate);
    (3) Enforcement of a support obligation including those activities 
associated with collections and the enforcement of court orders, 
administrative orders, warrants, income withholding, criminal 
proceedings, and prosecution of fraud related to child support; and
    (4) Investigation and prosecution of fraud related to child and 
spousal support;
    (e) Collection and disbursement of support payments, including:
    (1) Establishment and operation of an effective system for making 
collections and identifying delinquent cases and collecting from them;
    (2) Referral of cases to another Tribal CSE agency or to a State 
CSE program for collection when appropriate; and
    (3) Making collections for another Tribal CSE program or for a 
State CSE program;
    (f) Establishment and operation of a Tribal Parent Locator Service 
(TPLS) or agreements for referral of cases to a State PLS, another 
Tribal PLS, or the Federal PLS for location purposes;
    (g) Activities related to requests to State CSE programs for 
certification of collection for Federal Income Tax Refund Offset;
    (h) Establishing and maintaining case records;
    (i) Planning, design, development, installation, enhancement, and 
operation of CSE computer systems;
    (j) Staffing and equipment that are directly related to operating a 
Tribal CSE program;
    (k) The portion of salaries and expenses of a Tribe's chief 
executive

[[Page 50839]]

and staff that is directly attributable to managing and operating a 
Tribal CSE program;
    (l) The portion of salaries and expenses of Tribal judges and staff 
that is directly related to Tribal CSE program activities;
    (m) Service of process;
    (n) Training on a short-term basis that is directly related to 
operating a Tribal CSE program;
    (o) Costs associated with obtaining technical assistance that are 
directly related to operating a CSE program, from outside sources, 
including Tribes, Tribal organizations, State agencies, and private 
organizations, and costs associated with providing such technical 
assistance to public entities; and
    (p) Any other reasonable, necessary, and allocable costs with a 
direct correlation to a Tribal CSE program, consistent with the cost 
principles in OMB Circular A-87.


Sec. 309.150  What costs are allowable charges to Tribal CSE start-up 
programs carried out under Sec. 309.65(b) of this part?

    Federal funds are available for direct costs of developing a Tribal 
CSE program under an approved Tribal CSE application carried out under 
Sec. 309.65(b) of this part, provided that such costs are determined by 
the Secretary or designee to be reasonable, necessary, and allocable to 
the program. Federal funds are also available for indirect costs, where 
applicable, at the appropriate negotiated indirect cost rate. Federal 
funding for Tribal CSE program development under Sec. 309.65(b) may not 
exceed a total of $500,000; except that, when the non-Federal matching 
share is waived, Federal funding for Tribal CSE program development 
under Sec. 309.65(b) may not exceed a total of $555,555. Allowable 
start-up costs and activities include:
    (a) Planning for the development and implementation of a Tribal CSE 
program;
    (b) Developing Tribal CSE laws, codes, guidelines, systems, and 
procedures;
    (c) Recruiting, hiring, and training Tribal CSE program staff; and
    (d) Any other reasonable, necessary, and allocable costs with a 
direct correlation to development of a Tribal CSE program, consistent 
with the cost principles in OMB Circular A-87, and approved by the 
Secretary or designee.


Sec. 309.155  What uses of Tribal CSE program funds are not allowable?

    Federal Tribal CSE funds may not be used for:
    (a) Services provided or fees paid by other Federal agencies, or by 
programs funded by other Federal agencies;
    (b) Construction and major renovations;
    (c) Any expenditures that have been reimbursed by fees collected;
    (d) Expenditures for jailing of parents in Tribal CSE program 
cases;
    (e) The cost of legal counsel for indigent defendants in Tribal CSE 
program actions;
    (f) The cost of guardians ad litem; and
    (g) All other costs that are not reasonable, necessary, and 
allocable in Tribal CSE programs, under the costs principles in OMB 
Circular A-87.

Subpart E--Accountability and Monitoring


Sec. 309.160  How will OCSE determine if Tribal CSE program funds are 
appropriately expended?

    OCSE will rely on audits required by OMB Circular A-133, ``Audits 
of States, Local Governments, and Non-Profit Organizations'' and other 
provisions of 45 CFR 92.26. The Department has determined that this 
program is to be audited as a major program in accordance with section 
215(c) of the circular. The Department may supplement the required 
audits through reviews or audits conducted by its own staff.


Sec. 309.165  What recourse does a Tribe or Tribal organization have to 
dispute a determination to disallow Tribal CSE program expenditures?

    If a Tribe or Tribal organization disputes a decision to disallow 
Tribal CSE program expenditures, the grant appeals procedures outlined 
in 45 CFR Part 16 are applicable under this part.

Subpart F--Statistical and Narrative Reporting Requirements


Sec. 309.170  What statistical and narrative reporting requirements 
apply to Tribal CSE programs?

    Tribes and Tribal organizations must submit the following 
information and statistics for Tribal CSE program activity and caseload 
for each budget period:
    (a) Total number of cases and, of the total number of cases, the 
number that are TANF cases and the number that are non-TANF cases;
    (b) Total number of paternities needed and number of paternities 
established;
    (c) Total number of support orders needed and the total number of 
orders established;
    (d) Total amount of current support due and collected;
    (e) Total amount of past-due support owed and total collected;
    (f) A narrative report on activities, accomplishments, and progress 
of the program;
    (g) Total costs claimed;
    (h) Total amount of fees and costs recovered;
    (i) Total amount of automated data processing (ADP) costs; and
    (j) Total amount of laboratory paternity establishment costs.


Sec. 309.175  When are statistical and narrative reports due?

    A Tribe or Tribal organization must submit Tribal CSE program 
statistical and narrative reports no later than 90 days after the end 
of each budget period.

[FR Doc. 00-20798 Filed 8-18-00; 8:45 am]
BILLING CODE 4184-01-P