April 16, 2014 by Robert Franklin, Esq.
The Office of Child Support Enforcement has come out with its latest information about child support entitled “The Story Behind the Numbers: Major Change in Who is Owed Child Support Arrears.” While there’s some good news, sadly, the bad news remains much the same. And even the good news may obscure facts that many would regard as discouraging. Here’s the report (ACF, March, 2014).
The gist of the piece looks to be good news. Basically, the level of child support arrears going to the federal government is down. As we know, when a mother receives benefits under the Temporary Aid to Needy Families (or its predecessor, Aid to Families with Dependent Children), whatever child support she receives from Dad goes first, not to the child, but to reimburse the federal government.
But the OCSE report shows that, over time, arrears owed that would reimburse TANF payments have declined, both in absolute dollars and as a percentage of total arrears. So in 2002, total TANF arrears stood at about $34 billion but now they’re about $30 billion. Even more impressive is the fact that, in 2002, that amounted to 51% of all child support owed whereas now it’s about 26%.
This raises the question, “Why is this so?” After all, child support arrears generally have climbed through the roof, rising from about $65 billion in 2002 to $113 billion today.
Child support arrears have increased over time (see figure 1). A number of factors have contributed to the growth in arrears, including non-compliance with current support, lower rates of collections on arrears compared to current support, and the practice of assessing interest on unpaid support.
Ah, there’s our old friend “interest on arrears” again. The report doesn’t say what percentage of arrears are really just interest that’s accrued over the years, but with some states charging as much as 12% per annum, the interest portion is hefty. But of course fathers owing child support to the federal government aren’t exempt from being charged interest, so the question remains.
The answer is not that, through some magic, those receiving or those owing child support became wealthier and therefore didn’t need TANF benefits. No, that’s where the depressing old news comes in.
The driving factor, however, is the underlying characteristics of the individuals who owe arrears. Most arrears are owed by parents who owe substantial amounts of arrears, have little or no income, and have owed arrears for some time. These characteristics make it difficult to collect arrears. One study of nine large states estimated that only 40 percent of the arrears in those states were likely to be collected in 10 years and that arrears were likely to grow by 60 percent during that period unless states took steps to manage arrears growth.
Remember that the next time someone shouts about “deadbeat dads,” i.e. those who can pay but, out of the coldness of their hearts, don’t. Remember the fact that “most” of that $113 billion is owed by parents “who…have little or no income, and have owed arrears for some time.” Little or no income.
They’re the ones who can’t afford a lawyer to go to court to file the motions, assemble the evidence and convince a judge that an original child support order was set too high or that the person can no longer pay it. So the arrears just keep building up and up with stratospheric interest compounding all the while. And no one on the planet believes it’ll ever be paid.
Recall that the OCSE has been begging family courts for years to set support orders at levels non-custodial parents can actually pay. But the money flowing from the very same OCSE to states for child support collections means there’s no incentive to set reasonable orders and a very real one not to.
Then there’s the fact that, again, that same OCSE spends $5 billion a year on child support enforcement but only $10 million a year on visitation enforcement despite the fact that, as all acknowledge, fathers not denied visitation are far more likely to pay the support they owe. That Congress and the OCSE refuse to avail themselves of perhaps the most effective tool they have for collecting child support speaks volumes about their anti-father bias.
Those fathers who owe the lion’s share of child support, having either no income or very little, are of course the very ones most likely to father children with women receiving TANF benefits. So clearly, the reduction in TANF arrears isn’t due to greater payments by the fathers.
One step in the right direction of child support enforcement policy turns out be that OCSE has moved to ensure that child support payments actually go to — you know — support children rather than repay the federal government. It’s a novel concept and a good one.
Federal policy regarding assignment and distribution of child support has changed over time, favoring less assignment to the government and more distribution to families who receive or used to receive TANF cash assistance. Today, states may discontinue any assignment except for support owed while a family is receiving assistance. They may also distribute (or pass through) all child support collected to current and former TANF families.
But that doesn’t explain the divergence of TANF arrears from overall arrears.
There are three basic factors that could have contributed to the decline in TANF arrears:
1. TANF arrears collections could have increased.
2. Cases owing TANF arrears could have declined.
3. The amount of TANF arrears owed per case could have fallen.
The evidence does not support the first explanation for why TANF arrears have declined.
That’s putting it mildly. Particularly given the recession that began in 2008, the notion that poor fathers have somehow become more able to pay support to poor mothers is unlikely at best and in fact not true. Indeed, “TANF arrears collections have not increased in absolute or relative terms.”
Although the authors of the OCSE report appear hesitant to admit it, the reason for the drop in TANF arrears may be easy enough to understand. Those debts have decreased because the number of cases involving TANF mothers has declined. Fewer cases mean lower arrears.
Probably because it goes beyond the purview of their report, the authors don’t speculate on why there are fewer mothers seeking child support who’ve also received welfare benefits. Of course, I can’t be certain of the answer, but my strong belief is that the poor are less able to get benefits.
Back in 1996, the Clinton Administration signed into law sweeping welfare reform. One of the chief components of same was that there is now a five-year limit on benefits. Any person who’s received five years of TANF benefits can’t receive more. It’s my guess that that fact goes a long way toward explaining the lower numbers of mothers who’ve received welfare and are making claims for child support.
After all, what else would explain the fact that, when the Great Recession kicked into gear in late 2008, it caused not the slightest wrinkle in the graph showing the decline of TANF arrears. You’d think that, with millions of men losing their jobs, those arrears would have bumped up, but they didn’t.
From here it looks like fewer mothers qualified for welfare, so fewer arrears could also be TANF arrears. That’s one way to reduce arrears, but it’s no indicator of progress. That fewer mothers are getting TANF benefits is either good or bad depending on what you think of the federal welfare system, but it doesn’t mean more kids are getting more money. It likely means the opposite; the dads can’t pay and the moms aren’t getting TANF money.
Meanwhile, the old verities remain — skyrocketing arrears caused by too-high awards of support and too many fathers who are destitute and unable to pay. That, plus a child support system that couldn’t give a tinker’s damn about whether fathers see their children rounds out a dysfunctional system that’s only getting worse. Yes, the feds are allowing custodial parents to receive more of what non-custodial parents pay, and that’s a slight improvement over previous years. But it’s like spitting on a forest fire, i.e. not nearly enough to make a meaningful difference.
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