California seeks a way to enforce child support

By Lisa Martin

August 15, 1999

SACRAMENTO -- A legislative fix may be just around the corner for California's beleaguered child support enforcement system, a festering example of bureaucratic breakdown that is hurting countless children and costing taxpayers.

In addition to the human suffering involved, taxpayers must pay for an expanded safety net to help the victims of scofflaw parents, as well as finance efforts to catch the deadbeats and collect what they owe.

This issue has occupied a front burner this year in the state Legislature, where Senate and Assembly leaders have made reform a prime topic. Changes in the system could be adopted after the Legislature reconvenes tomorrow for the last month of its 1999 schedule.

Whether legislation to fix the program becomes law depends on the continuing battle over control and oversight, and how Gov. Gray Davis chooses sides.

California's child support enforcement and collection program is unique because it has one of the largest caseloads (4.5 million children). It is the second largest social service for children (education is first), yet it is considered one of the country's poorest efforts. As a result, California's policy makers are attempting to embark on major structural changes. Although many solutions have been proposed since the beginning of the year, the major debate has focused on whether to allow district attorneys to retain their child support enforcement responsibilities or shift the duties to a newly created state agency.

While district attorneys appear to be the whipping boys in legislative hearings, a new report from the Bureau of State Audits spreads blame throughout the system in all levels of government.

In a scathing report issued Aug. 5, State Auditor Kurt Sjoberg said the Child Support Enforcement Program (CSEP) "is disjointed, complicated, and lacking in leadership. Although no single entity is wholly responsible for the program's failures, state, county and federal CSEP administrators have all contributed to its often inadequate performance."

Investigations by the audit bureau and the Legislative Analyst's Office (LAO) have found these deficiencies:

The federal government puts pressure on the state to perform or risk stiff penalties. The federal law did not consider some of California's unique program issues, including higher court-ordered support payments. According to the state auditor, the law did not allow counties time to fully implement projects. Innovative efforts were hamstrung by legal requirements.

The California Department of Social Services, which is supposed to be riding herd on the program, has failed to monitor and assist poorly performing counties. The department has understated the problem. In 1997-98, the department said, $9.8 billion in child support payments were delinquent in California. However, state auditors say the real figure was $1.6 billion higher. The state could be subject to federal penalties of $80 million to $90 million a year for submitting incomplete data to the federal government.

The state wasted more than $111 million trying to develop a computer system to link the counties. It didn't work and was abandoned in 1997. This contributed to a dysfunctional program statewide as officials hoped to use such a system to track cases that move from county to county. The state could lose up to $4 billion in federal welfare subsidies if an acceptable statewide network is not created.

The system lacks uniformity because, with district attorneys in each of the 58 counties in charge, there is uneven enforcement. A deadbeat parent is treated as a criminal in one county, but not in another. Some counties have aggressive collection programs; others are relatively passive.

Critics have pounced on poor collection rates, particularly in Los Angeles County, which has failed to collect delinquent payments in nine of every 10 cases. Statewide, the LAO found that only $1.4 billion was collected in 1997-98 at a cost of $446 million to California taxpayers. Collections of delinquent child support payments are also bleak as California receives about only $1 of every $10 owed.

That isn't all. Several alarming statistics of welfare recipients owed child support payments have also emerged during public policy deliberations. Of the 4.5 million children owed child support, approximately 65 percent of them are on welfare -- and five of six of these children are not receiving any child support at all. Moreover, the statistics in Los Angeles County show that only 10,000 of 400,000 current child support collections are made for single parents on welfare.

In a recent study of CalWORKS recipients entitled to child support, the LAO discovered a strong relationship between the amount spent by counties and the amount of child support collected. The report revealed that unlike smaller counties, larger counties such as Los Angeles spend less on administrative effort and therefore have lower collection rates. One LAO suggestion is to increase financial incentives for district attorneys for improved collections.

According to the LAO, counties spend $456 on average in administrative effort on CalWORKS cases to collect $1,065 per case. San Diego County spent $434 to collect $1,524; Los Angeles spent $261 to collect $524. Mono County, with only 70 cases, actually spent an average of $1,307 in administrative costs to collect $1,046 per case.

From a taxpayers' perspective, California policy makers have the opportunity to include taxpayer-friendly elements and innovative approaches in the solution. Rather than reinventing the wheel by shifting responsibility from district attorneys to newly created bureaucracies or merely allowing district attorneys to retain their child support enforcement duties with increased collection incentives, what about a policy change that would enable counties to form better partnerships with the state to improve enforcement and collection outcomes? And, as an alternative to enhance district attorneys' financial resources to improve collection rates, allow help from state-of-the-art private companies that specialize in child support enforcement and collection services.

Examples of successful public-private partnerships can be found in Illinois and Montana. Cook County streamlined its process and improved collection rates by using an outside organization to review and modify support orders as well as income withholding for those who failed to pay. Montana contracted with a private entity to provide customer service, allowing state staff to devote more time to increase collections. The private entity provides key education, interviews custodial parents to help determine paternity, and verifies identity of non-custodial parents.

Meanwhile, the decibel level has gone up in recent weeks. Proponents of a major shakeup applauded the Bureau of State Audits report. District attorneys mounted an offensive of their own.

Los Angeles County District Attorney Gil Garcetti announced the arrests of more than 400 parents on suspicion of delinquent child support. The week-long operation starting July 30 cost the county more than $600,000, according to the DA's office. The crackdown could be expected to increase child support payments by $944,000 a year, said Steven K. Buster, new chief of Garcetti's child support unit. The office had a backlog of 6,700 arrest warrants.

The California District Attorneys Association issued a press release noting that last year's child support collections statewide increased by 17 percent over the previous year -- or $240 million more for families owed support (San Diego County's increase was 13 percent).

"Collecting delinquent child support has been one of the most difficult challenges we face," said the association president, Riverside County DA Grover Trask. "These results reflect the increased priority we have given to this effort."

As a solution to California's enforcement and collection problems, two bills have advanced through both houses and are pending final approval of amendments in the Senate or Assembly. Both would take child support enforcement away from district attorneys and create new state and county functions. They are SB 542, authored by Senate President Pro Tem John Burton, D-San Francisco, and AB 196, by Assembly Judiciary Committee Chair Sheila Kuehl, D-Santa Monica.

A supporter of the Burton-Kuehl legislative effort, Kathryn Dresslar of the Children's Advocacy Institute in San Diego, said of the state auditor report: "This critical report confirms the urgent need for enacting SB 542 and AB196. These bills will create true leadership and accountability for the program. California children should not have to depend on a floundering system any longer. These bills must be enacted this year."

Burton, in an earlier statement, said, "Instead of simply protecting turf or defending an indefensible system, opponents of this legislation would be better off working to make sure what they are doing right is folded into the new system."

It was anticipated that the Burton and Kuehl measures will result in a Senate-Assembly conference committee for a possible compromise with input from Gov. Davis before the Legislature quits for the year on Sept. 10.

Another issue is whether the Franchise Tax Board -- the mammoth agency that administers state personal and business income taxes -- should expand its child support collection role. Davis, when serving as state controller, supported use of the FTB to collect child support. The current controller, Kathleen Connell, says the FTB is not a social services agency and policy makers should not sacrifice an efficient tax agency for functions that are not its original purpose.

The governor's press secretary, Michael Bustamante, said in early June, "The governor is not happy with the failures of the existing system. He is looking for a way to make significant improvements. He is not going to let children continue to suffer."

At this point, only Davis knows (and he's not telling) if district attorneys will be allowed to keep their child support enforcement powers or forced to relinquish them to the state, which runs the risk of not doing a better job. Either way, taxpayers should take a keen interest in the outcome.

Martin is a policy analyst for the California Taxpayers' Association in Sacramento.

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