TDA-27-15-00002-P Child Support Federal Incentive Payments

7/8/15 N.Y. St. Reg. TDA-27-15-00002-P

NEW YORK STATE REGISTER

VOLUME XXXVII, ISSUE 27

July 08, 2015

RULE MAKING ACTIVITIES

OFFICE OF TEMPORARY AND DISABILITY ASSISTANCE

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. TDA-27-15-00002-P

Child Support Federal Incentive Payments

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed Action:

Amendment of section 347.16 of Title 18 NYCRR.

Statutory authority:

Social Services Law, sections 20(3)(d), 34(3)(f), 111-a; 42 U.S.C., section 658a; 45 CFR, sections 302.55, 303.52, 305.2, 305.31 and 305.33

Subject:

Child support federal incentive payments.

Purpose:

To update State procedures to distribute federal child support incentives and allocate portions thereof to local districts.

Text of proposed rule:

Section 347.16 of Title 18 of the NYCRR is amended to read as follows:

§ 347.16 Federal incentive payments.

(a) For purposes of this section, [ADC] support collections [means] include all [child] support collections retained in [ADC and foster care] cases receiving child support services from all sources: [(] within a social services district [county], from other New York State social services districts [counties], and from other states, as well as [ADC and foster care] collections made in the reporting social services district and forwarded to other states. [Non-ADC collections means child support collections retained in non-ADC cases from all such sources, as well as non-ADC collections made in the reporting social services district and forwarded to other states.]

(b) The [Statewide] incentive payment[s] made to a state in a federal fiscal year [for ADC and non-ADC child support collections] will be [estimated] determined by the U.S. Department of Health and Human Services [(HHS)] based on statewide performance [effectiveness and efficiency] in each [area] of the following five performance measures of the child support enforcement program (Title IV-D) [, which shall be determined as follows]: paternity establishment; support order establishment; current support payments; arrearage payments; and cost-effectiveness.

[(1) ADC-statewide ratio of ADC collections to total IV-D administrative costs; and

(2) Non-ADC-statewide ratio of non-ADC collections to total IV-D administrative costs.

(c) The ADC and the non-ADC ratios of collections to administrative expenditures will be rounded to one decimal place and will result in statewide incentives based on the following chart:

Ratio of collections to total IV-D administrative costs	Percent of collection paid as an incentive
Less than 1.4 collected to 1.0 expended	6.0
At least 1.4 collected to 1.0 expended	6.5
At least 1.6 collected to 1.0 expended	7.0
At least 1.8 collected to 1.0 expended	7.5
At least 2.0 collected to 1.0 expended	8.0
At least 2.2 collected to 1.0 expended	8.5
At least 2.4 collected to 1.0 expended	9.0
At least 2.6 collected to 1.0 expended	9.5
At least 2.8 collected to 1.0 expended	10.0

These rates will be applied to estimated collections as determined by HHS.]

(c) [(d)] States receive federal incentives based upon their respective percentage of the maximum incentive base for all states as applied against the total capped incentive payment pool available to all states. The incentive payment for a state for a federal fiscal year will be equal to the incentive payment pool for the federal fiscal year, multiplied by the state’s incentive payment share for the federal fiscal year. [Statewide incentives earned for non-ADC collections will be limited to the percentage of ADC-incentives in accordance with the following schedule:

(1) 100 percent in Federal fiscal years 1986 and 1987;

(2) 105 percent in Federal fiscal year 1988;

(3) 110 percent in Federal fiscal year 1989;

(4) 115 percent in Federal fiscal year 1990 and thereafter.]

(d) [(e) Estimated statewide] The Office will allocate an amount of the federal incentive payment[s] made to the State in a federal fiscal year [will be passed through] to the [local] social services districts based on the following [a] methodology [which takes into consideration the total ADC and non-ADC incentives earned by the State and each local district’s effectiveness and efficiency in its administration of the local child support enforcement program. That methodology is set forth as follows]:

(1) determine each social services district's total [ADC collections and total IV-D expenditures] collections for the federal fiscal year;

(2) determine the portion of the incentive payment made to the State that is available to be allocated to the social services districts; and

(3) allocate to each social services district a share of the available incentive payment based upon its respective percentage of the total statewide collections during the federal fiscal year. [calculate the ADC cost benefit ratio for each district, by dividing total ADC collections for such district by total IV-D expenditures for such district;

(3) the incentive rate chart set forth in subdivision (c) of this section to determine the ADC incentive rate for each district, based on its ADC cost benefit ratio;

(4) multiply each district's ADC incentive rate as determined in paragraph (3) of this subdivision, by each district's total ADC collections to calculate each district's ADC incentive amount; and

(5) when totaling the incentive amounts for all districts, the State's total ADC incentives may be more or less than the amount eligible for distribution based on the statewide cost benefit ratio. Therefore, the amount available to the State will be divided by the total amount of the districts' incentives to obtain a proration factor. This factor is then multiplied by the incentive amount calculated in paragraph (4) of this subdivision. The sum of these individual prorated amounts will then equal the state wide total incentives available.]

(e) [(f) Estimated statewide non-ADC incentive payments will be distributed to the local districts using the same methodology described in subdivision (e) of this section except that the statewide non-ADC incentive amounts calculated pursuant to subdivision (d) of this section shall be substituted for the ADC incentive amounts.

(g) At the close of each Federal fiscal year, actual incentives earned will be provided to each local district. Each local district will then submit a supplemental monthly ADC collection report to the department to adjust the incentives from estimated to actual payments, in accordance with department guidelines.] During each federal fiscal year, the Office will advise each social services district of its respective child support incentive amount. Each social services district will report its child support incentive amount in accordance with Office guidelines.

Text of proposed rule and any required statements and analyses may be obtained from:

Jeanine S. Behuniak, New York State Office of Temporary and Disability Assistance, 40 North Pearl Street, 16C, Albany, New York 12243, [phone], email: [e-mail]

Data, views or arguments may be submitted to:

Same as above.

Public comment will be received until:

45 days after publication of this notice.

Regulatory Impact Statement

1. Statutory authority:

Social Services Law (SSL) § 20(3)(d) authorizes the Office of Temporary and Disability Assistance (OTDA) to promulgate regulations to carry out its powers and duties.

SSL § 34(3)(f) requires the Commissioner of the OTDA to establish regulations for the administration of public assistance and care within the State.

SSL § 111-a requires the OTDA to promulgate regulations necessary to obtain and retain approval of its child support state plan, which is required to be submitted to the federal Department of Health and Human Services by Part D of Title IV of the federal Social Security Act.

Title 42 of the United States Code (42 USC) § 658a, also known as section 458 of the federal Social Security Act, governs incentive payments to states. The Child Support Performance and Incentive Act (CSPIA) of 1998, P.L. 105-200, inserted a new § 458 of the federal Social Security Act defining a new federal incentive payment system, which allocates incentives based on the available incentive payment pool and the state’s performance level in five areas of the child support enforcement program (paternity establishment, support order establishment, current support payments, arrearage payments, and cost-effectiveness).

45 CFR § 302.55 requires the child support state plan to provide that political subdivisions (i.e., local social services districts) which participate in the costs of carrying out the activities under the child support state plan receive an appropriate share of any incentive payments made to the state, as determined by the state.

45 CFR § 303.52 regulates the calculation and allocation of incentives to political subdivisions by the State IV-D agency. The State IV-D agency must develop a standard methodology for allotment of incentives to political subdivisions, taking into account the efficiency and effectiveness of the activities carried out under the state plan by those political subdivisions.

45 CFR Part 305 governs child support program performance measures, standards, and financial incentives. Specifically, 45 CFR § 305.2 defines the five performance measures used in the child support incentive system and the weight given to each measure; 45 CFR § 305.31 identifies the amount of the incentive payment for a state for a federal fiscal year; and 45 CFR § 305.33 describes the determination of applicable percentages based on performance levels.

2. Legislative objectives:

It was the intent of the Legislature in enacting the state statutes mentioned above that OTDA establish rules, regulations and policies so that child support enforcement services are provided to eligible persons to ensure that, to the greatest extent possible, parents provide financial support for their children, and that the State obtain and retain approval of its child support state plan.

3. Needs and benefits:

The amendment to 18 NYCRR § 347.16 is being made as a result of changes to the federal incentive payment process under CSPIA. These changes relate to section 458 of the federal Social Security Act. The regulatory amendment will establish the procedures by which the State will distribute child support incentives received from the U.S. Department of Health and Human Services and allocate portions of those incentives to local social service districts.

4. Costs:

There are no new costs associated with the amendments to the regulations.

5. Local government mandates:

The DCSE and local social services districts have followed the federal procedural rules regarding incentive payments that became fully operational with the 2002 federal fiscal year. No new or additional requirements will be imposed on local social service districts.

6. Paperwork:

No new or additional requirements will result from the amendments to the regulations.

7. Duplication:

The proposed amendments do not duplicate, overlap or conflict with any existing State or federal statutes or regulations.

8. Alternatives:

No alternatives were considered since the proposed amendments are in accordance with the aforementioned federal statutes and requirements.

9. Federal standards:

The proposed amendments do not exceed federal minimum standards for the same subject.

10. Compliance schedule:

The requirements under the proposed amendments are currently operational within the DCSE and the local social services districts. The State and local social services districts are in compliance with the proposed amendments.

Regulatory Flexibility Analysis

1. Effect of rule:

Each of the 58 local social service districts will be affected by the proposed regulatory amendments.

2. Compliance requirements:

Local social services districts will be required to comply with the proposed amendment. Given that the changes make State regulation consistent with federal regulations regarding incentive payments and are primarily of an administrative nature meant to clarify requirements that became fully operational with the 2002 federal fiscal year, local social services districts will have no new reporting or recordkeeping obligations.

3. Professional services:

The NYS Division of Child Support Enforcement (DCSE) within the Office of Temporary and Disability Assistance (OTDA) continues to assume the responsibility for the systematic programming of the methodology used to determine the actual incentive allocated to each local social services district. For this reason, the local social services districts will not need to hire additional staff.

4. Compliance costs:

This regulation will not result in increased administrative costs for local social services districts. The amendment to this regulation is being made to update State regulation in light of changes to federal rules which determine the amount of federal incentives received by states. The DCSE continues to assume the administrative costs and responsibility for the systematic programming of the methodology used to determine the actual incentive allocated to each local social services district.

5. Economic and technological feasibility:

The DCSE continues to assume all administrative costs and responsibility for implementing the proposed amendment. Technological feasibility is not a concern for the local social services districts.

6. Minimizing adverse impact:

Approaches for minimizing adverse economic impact were not considered since no adverse economic impact is present under the proposed amendment.

7. Small business and local government participation:

The performance-based incentive funding system is federally mandated. The proposed amendments will update the State regulation to be consistent with the current federal incentive system.

The changes to the federal incentive payment system were discussed with local social services districts when they went into effect. No specific concerns were raised by the local social services districts about the federal requirements.

Rural Area Flexibility Analysis

1. Types and estimated numbers of rural areas:

The proposed regulations will affect the 44 rural social services districts in the State.

2. Reporting, recordkeeping and other compliance requirements; and professional services:

Local social services districts, including those in rural areas, will not be affected by the proposed amendment. The changes are of an administrative nature managed by the NYS Division of Child Support Enforcement (DCSE) within the Office of Temporary and Disability Assistance (OTDA). Given that the changes are administrative in nature and managed by the State, local social services districts will not be required to hire additional staff or provide training.

3. Costs:

This regulation will not result in increased administrative costs for social services districts. The DCSE continues to assume the administrative costs and responsibility for the systematic programming of the methodology used to determine the actual incentive allocated to each local social services district.

4. Minimizing adverse impact:

The proposed regulation makes State regulations consistent with federal requirements for the payment of incentives that were enacted as part of the Child Support Performance and Incentive Act of 1998 (CSPIA) and were clarified by final rule in December 2000. Maximizing performance in the collection of current support payments and arrearage payments, as well as the associated paternity establishment, support order establishment, and cost-effectiveness performance measures mandated by the U.S. Department of Health and Human Services does not adversely impact social services districts, including those in rural areas.

5. Rural area participation:

The performance-based incentive funding system is federally-mandated. The proposed amendments will update State regulation to be consistent with the current federal incentive system. Local districts have been aware of the amendments to procedural rules regarding federal incentive payments since their effective date in December 2000. OTDA annually publishes a memorandum to local social services districts to advise them of their respective incentive amount for that year.

The statutes on which these regulatory changes are predicated were discussed with the local social services districts in rural areas when they went into effect. No specific concerns about the federal requirements were raised by the local social services districts in rural areas.

Job Impact Statement

A job impact statement has not been prepared for the proposed regulatory amendment. It is apparent from the nature and the purpose of the proposed rule that it will not have a substantial adverse impact on jobs and employment opportunities in the State. The proposed amendments to 18 NYCRR 347.16 will have no impact on jobs and employment opportunities in either the public or private sectors of the State. Furthermore, child support enforcement jobs will not be impacted by the proposed amendment.