Child Support
Case: Harp v. Metcalf - Child Support Class Action Suit - NoticesIN THE FIFTH CIRCUIT COURT FOR DAVIDSON COUNTY, TENNESSEE SHARON HARP, ET AL, )
MEMORANDUM AND ORDER This is a multi-faceted class action case involving the administration of the state-run child support collection system which went into effect in October, 1999. Before the Court for decision are cross motions for summary judgment related to the issue of whether the notice and/or information provided to recipients of the child support services comports with due process notice requirements of the state and federal constitution. With some narrow exceptions, the plaintiffs are precluded from enforcing directly or indirectly the federal statutes and regulations governing child support collection. See Blessing v. Freestone, 520 U.S. 329, 117 S.Ct. 1353 (1997) and Davis v. O'Hara, 40 S.W.3d 24 (Tenn. App. 2000). The issue before the Court is, therefore, narrowed to whether the notices sent and challenging procedures available are constitutional. State and federal statutes mandate certain minimum notice (See 42 U.S.C. § 654(5) and T.C.A. § 36-5-116(e)), however, plaintiffs contend that the constitution requires far more than the statutorily mandated minimum. The plaintiffs contend that the defendant violated the constitutional requirements of due process by failing to provide prompt, accurate, timely, frequent, and meaningful notice sufficient to understand the distribution of each collection, to identify errors in processing the distribution and disbursement of child support payments received from the non-custodial parent or his or her employer, and by failing to provide adequate notice of the availability of the Department's administrative procedures for addressing such errors. The Department contends that its procedures satisfy all constitutional due process notice and hearing requirements. There are other aspects of this case related to collection of a processing fee and recoupment of bad check payments which are not presently before the Court for decision. By prior Order dated July 13, 2000, the Court certified this case a class action. The Class is defined as: All Tennessee residents who are custodial parents or caretakers of children for whom child support is collected and disbursed pursuant to 42 U.S.C. § 654b and T.C.A. § 36-5-116 through the Defendant's state disbursement unit. Three subclasses are defined as: (1) All Tennessee residents who are custodial parents or caretakers of children who receive Families First cash assistance; (2) All Tennessee residents who are custodial parents or caretakers of children who have previously received Families First or Aid to Families with Dependent Children and for whom the Defendant holds an assignment of the right to child support; and (3) All Tennessee residents who are custodial parents or caretakers of children for whom child support services are provided under Title IV-D, 42 U.S.C. § 651 et seq. but for whom the Defendant does not hold an assignment of the right to child support. Both sides to this "notice" controversy have filed lengthy memorandums in support of the cross motions and numerous exhibits and other supportive materials. Argument was held before the Court on April 27, 2001, and the case was then taken under advisement. A recent report by the Inspector General of The Department of Health and Human Services provides a good but brief summary of the State's obligation beginning on October 1, 1999. In the 1996 Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), Congress required States to centralize collection and disbursement of child support payments into State Disbursement Units (SDUs)(1). The primary objectives of centralization are to provide employers with a single location in each State to send income withholding payments, and to make payment processing more efficient and economical. Federal law requires that States: • Implement the SDU by a Deadline of October 1, 1998 or (October 1, 1999 for States with Previous Clerks of Court Involvement) • Provide Employers with a Single Location to Send Payments • Disburse Payments Within Two (2) Business Days • Process All Payments for a Specified Caseload (With Discretion to Include All Cases) • Provide Payment Information to Parents • Operate the SDU Through a State Agency or Contractors • Staff SDUs Sufficiently to Perform Required Functions • Automate Procedures as Much as Feasible, Efficient, and Economical • Integrate the SDU with the State's Automated Child Support System • Monitor SDU Performance Just how this system is to work is as follows: Centralized collection and disbursement uses a single central automated unit to handle payment processing for child support. There are a number of potential advantages to this. One major advantage is efficiency, because economics of scale mean that automation can be used throughout the payment and disbursement process. Centralized collection and disbursement facilitates the use of electronic fund transfers, high speed check processing equipment, automated mail and postal procedures, and automated billing and statement processing. In addition, it also makes payments much easier for employers because they only have to send or transfer one payment to one place for all their income withholding orders. Another advantage of centralized collection and disbursement is the potential for better customer service. The unit can institute standard procedures, hire specialized customer representatives, and use automated voice response units. Such units may also insure better accuracy for receipt and deposit of payments and disbursement to parents. Turnaround time can be as little as one day. The final advantage of centralized collection and disbursement is that this can lead to improved enforcement. Centralized collection and disbursement works in conjunction with central registries. So payments can be monitored and case records immediately accessed. This facilitates mass case processing--computer matching of data, imposing liens, attaching bank accounts, intercepting unemployment compensation, workers compensation, and other state benefits. Monitoring and quick enforcement insures better payment records and higher collections. And child support workers at the county level, who now spend their time keeping track of collections and disbursements, can concentrate on other child support matters such as establishing paternities and enforcing obligations in the remaining cases not reached through mass case processing techniques. Kegler, The Coming Revolution in Child Support Policy: Implications of the 1996 Welfare Act, 30 Fam. L.Q. 519, 549-51 (1996). Of course anyone who has communicated with a computer-run accounting system recognizes its advantages but has been subject to the frustrations of dealing with any mistakes it makes. The history of how the state got into the centralized child support collection business is explained: Congress' first serious venture into child support enforcement legislation with the enactment of Title IV-D in 1974 left states in charge of child support collection and paternity determination but gave the federal government a new role as "an active stimulator, overseer and financier of state collection systems." Under the new regime, all AFDC applicants were required to assign their rights to child support to the state and to "agree to cooperate in locating the absent parent, establishing paternity, obtaining a support judgment . . . and securing payments." The new state agencies were to establish a "parent locator service," with access to federal data including Internal Revenue and Social Security information. Although the primary goal of the 1974 changes was to reduce federal expenditures for the AFDC program, the child support enforcement resources were also made available to persons who were not AFDC claimants (for a small fee). Within a few years, half of all support collections were for non-AFDC families. Ten years after the support enforcement program began, Congress effectively nationalized the entire system of child support determination and collection with passage of the Child Support Enforcement Amendments of 1984. The 1984 law required states to establish objective, non-binding, child support "guidelines," a state commission on child support, and a series of new support enforcement procedures such as mandatory wage withholding orders. One of the goals of this legislation was to make better support enforcement available for all children, not just those receiving AFDC funds. These requirements led to significant changes in state child support and paternity laws. Moreover, the amendments were accompanied by a policy statement urging state and local governments to focus on child support, custody, and visitation issues and to "recognize the seriousness of these matters . . . and assign them the highest priority." The system instituted in 1984 was followed by further enactments in 1988. The 1988 Child Support Amendments, part of a larger package of welfare reforms, set new federal standards for paternity determination, provided that the support guidelines must be used presumptively to establish support orders, and extended mandatory wage withholding rules to all child support orders. The 1988 enactments also created the U.S. Commission on Interstate Child Support, which was charged with making recommendations on improvements to the interstate establishment and enforcement of child support awards. The Commission's Final Report, issued in August 1992, included 120 separate recommendations to Congress. Following one of the Commission's recommendations, Congress acted in 1992 to create a new federal remedy for interstate child support enforcement: the Child Support Recovery Act of 1992, which criminalizes the willful failure to pay child support owed to a child in another state. In the same bill, Congress established a Commission on Child and Family Welfare and charged it with compiling information and making recommendations on "the issues that affect the best interests of children," including "domestic issues" such as abuse, child custody, visitation and placement, and juvenile and family courts. In 1994, Congress implemented another of the recommendations of the U.S. Commission on Interstate Child Support with the passage of the Full Faith and Credit for Child Support Orders Act. In 1996, Congress passed additional child support enforcement legislation as part of the welfare reform bill. These new provisions incorporate many recommendations of the Commission on Interstate Child Support. According to Paul Legler, the 1996 legislation embodies a new "vision" in which payment of child support obligations is "automatic and inescapable." Among other new requirements, the legislation mandates that states establish automated state case registries with records of every support order established or modified in the state, create "disbursement units" to collect and distribute support payments, change state laws to permit administrative rather than judicial enforcement of interstate support orders and to permit mandatory income withholding from support obligors without prior judicial or administrative hearings, change state laws governing paternity establishment, and adopt the Uniform Interstate Family Support Act ("UIFSA"). Estin, Federalism and Child Support, 5 Va. J. Soc. Pol'y & L. 541, 545-48 (1998) (emphasis added) (citations omitted). The Department's system processes child support collections for those persons (1) receiving Families First(2) benefits under the Temporary Assistance for Needy Families program,(3) (2) those persons who have previously received Families First benefits,(4) (3) all custodians who have court-ordered support requiring payment through wage withholding(5) and (4) custodial parents who receive child support services under Title IV-D of the Social Security Act (6) (Title IV, Part D is at 42 U.S.C. § 651 et seq.). The volume of cases is significant, with the March, 2001 affidavit of the Director of Child Support Fiscal Services, Richard Paige, stating that since October, 1999 the system has processed 4,155,000 payments with approximately 10,000 processed daily. Mr. Paige's April, 2001 affidavit explained that there are 127,298 current Families First child support cases, 182,280 former Families First/AFDC child support cases, 133,589 IV-D child support cases, and 26,477 non IV-D child support cases being processed through the centralized collections and disbursement unit. The affidavit of Deborah Hood, Program Manager, fixes the approximate number of cases at 467,000. With regard to each category, the present notice given by defendant varies according to the type of recipient. Custodial Parents Currently on Families First. These custodial parents receive a Monthly Notice Collections. The monthly collections and disbursement notice contains the name of the non-custodial parent paying support; the Tennessee Child Support Enforcement System ("TCSES") number;(7) the date the child support was collected for the current month; the amount of the collection; the amount that the defendant treated as payment for current monthly support; the amount the defendant treated as payment for past due support; and the amount sent to the custodial parent for the month. In the monthly notice each category of information is arranged in columns so that the recipient can identify the information related to each category. In addition, it contains a three (3) paragraph explanation containing definitions of the items in each column. On the same page the defendant includes a section concerning the rights to a review and appeal: YOUR RIGHTS TO HAVE A REVIEW AND APPEAL T.C.A. § 36-5-1001
If you think we have made a mistake about the amounts listed in your Monthly Notice of Collections you must contact the Customer Service Unit at 1-800-838-6911. When you call you should tell the representative that you think that a mistake has been made and would like to have a review. We will send you a form to fill out and return telling us about your problem with the notice. We have up to thirty (30) days to review your case, and will send you a written Notice of what we have found. If we do not respond within that thirty (30) day period, an Administrative Hearing will be scheduled and you will be notified of the Hearing. If you disagree with the response we send you, you will have a right to request an Administrative Hearing. These recipients also receive information from the Families First program. The defendant provides these recipients with the Tennessee Child Support Handbook, a twenty four (24) page booklet providing general information on child support and its relation to the Families First program. The recipients also receive certain inserts to add to the Handbook. The recipients receive a notice from the Families First program when a change in the standard of need occurs.(8) The standard of need is important because the defendant uses that standard to determine whether recipients qualify for Families First benefits and then whether the recipient is entitled to a "pass through payment" from collected child support. See T.C.A. § 71-3-154. The Families First grant amount is a percentage of the standard of need. See T.C.A. § 71-3-155(g). The state then fills the gap between the grant amount plus earned income and the standard of need with a "pass through payment" to the custodial parent of collected child support in order to meet the "unmet need."(9) For example, if the standard of need for a family is Five Hundred Dollars ($500.00), the Families First grant payment is One Hundred Fifty Dollars ($150.00) and the custodial parent earns Three Hundred Dollars ($300.00), then of the collected child support the recipient would receive Fifty Dollars ($50.00) per month as a "pass through payment" to meet the family's "unmet need." Families First recipients are sent notices of approval and termination of Families First benefits as well as notice of any changes in their grant amount, changes in the members of their assistance group, or changes in the amount of their household income. The recipients receive this notice when a change of information is reported regardless of whether a change in benefits occurs. This notice is more detailed than the monthly notice of collection and distribution and includes language about the child support enforcement program. The defendant includes a two-sided one (1) page insert containing information about correcting problems with Families First benefits, contacting the recipient's assigned case worker, and the right to an appeal and fair hearing. Custodial Parents Previously on Families First. These recipients are those who no longer receive Families First benefits but the non-custodial parent accrued arrearages (underpayment of court-ordered support) during the time when the custodial parent did receive Families First benefits. Those arrearages are owed to the defendant. A custodial parent becomes a IV-D custodial parent, as addressed below, if he or she no longer receives Families First benefits and no arrearages occurred during the time the custodial parent was on Families First or all arrearages that did occur have been satisfied. If an arrearage occurs while a custodial parent is receiving Families First benefits, a much more complex calculation is required in order to distribute past due child support. If the custodial parent is in the Families First program at the time an arrearage occurs, any future satisfaction of the past due amount is an "assigned arrearage" which is retained by the defendant. If the custodial parent is not in the Families First program at the time the arrearage occurs, the arrearage is an "unassigned arrearage," which, if satisfied in the future, passes directly to the custodial parent. Once the custodial parent has received payment from support collected by the defendant for all unassigned arrearages he or she is owed, the defendant may only then be reimbursed for the assigned arrearages. This reimbursement from arrearage payments is limited to the total amount of cash assistance that had been paid through Families First.(10) These custodial parents no longer receive the Families First notice but continue to receive the monthly notice of collections and distribution until all assigned arrearages have been satisfied and they return to IV-D status. Non IV-D Custodial Parents. These are recipients required to receive their payments from the SDU simply because of court-ordered wage withholding pursuant to T.C.A. § 36-5-116. These custodial parents receive only a disbursement check and check stub from the defendant. The defendant has indicated in her brief that the notice will change in the future to include the amount of payment received and year-to-date totals. Defendant contends that these recipients have access to court orders and can track arrearages, however, defendant does not provide such information. IV-D Custodial Parents Never on Families First. These payments are processed through the SDU because the custodial parent has sought child support collection services under Title IV-D of the Social Security Act. These recipients have sought assistance in a Title IV-D proceeding to establish, modify, or collect child support. These custodial parents also receive notice only from the disbursement check and check stub. The defendant provides a copy of the Tennessee Child Support Handbook and the court order requiring payment of child support. See 42 U.S.C. 654(12)(B).(11) The plaintiffs contend that the notice currently provided to the custodial parents is not sufficient to satisfy due process in that it creates a risk of erroneous deprivation to a private interest - child support. According to the plaintiffs, the lack of detail and specific information in the above-described notices violate due process standards. The form of notice presently used by the defendant is not sufficient to accommodate the likely high rate of errors considering the volume of custodial parents, the complex systems of records, and the computer software used by the defendant to administer collections and distributions. It is not "informative notice which reports every collection and how it is distributed and allows every dollar received to be traced to a check written to the custodial parent or to the payment of a claim by the defendant." More specifically, plaintiffs contend the amount of child support the court ordered to be paid to the custodial parent is absent from the notice. The present notice contains information on payments from previous months. The present notice does not alert the custodial parent of such things as a miscalculation of a gap or "pass through payment" or the need for an accounting to determine an amount of arrears owed or withheld. In order to correctly make the "pass through payment" calculation, computer data from ACCENT, the DHS computer database used to enter information regarding aid status for Families First, and the TCSES computer system must be used simultaneously. The chance for error is high and the present notice does not alert the recipients to errors in the data input or calculation. This insufficiency is true for each category of recipients, according to plaintiffs. With custodial parents receiving Families First benefits, the present notice does not provide sufficient information on current court-ordered support, whether the defendant classifies the parent as receiving Families First benefits, the information used to calculate the unmet need, the dates and amounts of collections and distributions, whether an intercept of a federal tax return has occurred(12) , and the legal date of collection. For custodial parents previously on Families First, it does not provide information as to whether the custodial parent is classified by defendant as being on Families First, an explanation of the assignment and arrears, the court-ordered support information, the date each amount was collected and sent, the date of withholding, and whether a tax return intercept has occurred. With strictly Title IV-D class members the present notice does not state the court-ordered support information or the support collected and distributed. Finally, the non IV-D recipients do not have sufficient notice indicating the support collected and distributed and how to obtain appellate review. Further, plaintiffs assert the text and format of the present notices to be confusing and incomplete. The definitions fail to match those in the federal regulations and the text uses symbols and vague indicators, such as minus (-) signs, to signal changes in monthly support. The text is incomplete in that it does not provide a clear explanation of the distribution rules. Notices concerning reviews and appeals are confusing and misleading. Finally, time limitations are unclear, allowing the custodial parents to falsely believe they have waited too long to assert their rights. Defendant contends that the notices sent as well as information and notices from the Families First program, copies of child support orders, and check stubs are sufficient to pass due process analysis for each category of recipients. Also, defendant cites a number of other sources which assist in providing collection and distribution information that should be considered in their totality for determining due process. Defendant provides custodial parents receiving Families First benefits and Title IV-D service recipients with the Tennessee Child Support Handbook. Defendant also refers to local child support offices and individual caseworkers as collateral sources of information. These local offices answer questions, have information on TCSES processes, can refer more complicated questions to Child Support Fiscal Services, and assist and process appeals. The defendant established a Customer Service Unit ("CSU") available ten (10) hours a day, five (5) days a week to custodial and non-custodial parents through a toll free telephone number. The CSU representatives provide basic information and have access to the TCSES computer system. The defendant also operates a toll free statewide telephone integrated voice response system ("IVR"). The IVR provides individualized information, such as the amount collected and the date payment was sent, available through a case number or member identification number. The defendant will soon provide Internet access to this information. The person can access the payment date, check number, payment status, and payment amount. Finally, the defendant points to the local clerk's office for information on court orders and the status of a TCSES payment. The Tennessee Code mandates minimum notice standards regarding collection and distribution for Families First participants. The defendant must provide the "[c]ustodial parent's name; the non-custodial parent's name; TCSES identification number; the date the child support was collected in the current month; the amount of child support collected that was treated as current month child support; the amount of child support collected that was treated as past due child support; and the amount of child support sent to the custodial parent in the month." T.C.A. § 36-5-116(e)(1)(A)-(G). The same provision provides that by April 1, 2002, the defendant will provide notice for all payments processed by the SDU in "an easily understood format" containing "[t]he custodial parent's name; non-custodial parent's name; TCSES identification number; court docket number; the amount of the current child support payment; the date on which the payment was issued; and the total of all payments issued to date during the current year." T.C.A. § 36-5-116(e)(2)(A)-(G). To encourage efficiency in disbursement of collected funds, as of July 1, 2001, a penalty payment must be made to custodial parents, if requested, of ten percent (10%) of a payment not disbursed within two (2) weeks of its receipt or Fifty Dollars ($50.00), whichever is less. T.C.A. § 36-5-116(f)(effective July 1, 2001). Statutory authority allows administrative review of the distribution of support collections under the Uniform Administrative Procedures Act. See T.C.A. § 36-5-1001(a)(H) & (b). Pursuant to T.C.A. § 36-5-1001(c)(1) a person seeking review of defendant's actions must file a written request within fifteen (15) calendar days following notice of the administrative action. This review is "[l]imited to a determination of the correct identity of the person(s) or entity(ies) to whom or to which the administrative action is directed, [and] to whether there is a mistake of fact involving the action . . . ." T.C.A. § 36-5-1002(a). The administrative review of the distribution of collections will not be conducted until the aggrieved party has first contacted the defendant for a conciliation process. T.C.A. § 36-5-1002 (a)(11)(A). The defendant then has thirty (30) days to resolve the issue. If unresolved, the defendant contacts the person and informs them of their right to proceed. Id. The proper approach to procedural due process in the administration of a government program involving the distribution of funds either as an entitlement or as a service is to look at it with an eye to insure fairness. In cases such as Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011 (1970) the Supreme Court began to draw the outline of the structure that must be applied. In Goldberg recipients were terminated from the welfare rolls without a hearing and very little information about why they were being terminated. The court held that "the fundamental requisite of due process of law is the opportunity to be heard" and that includes an "adequate notice detailing the reasons for a proposed termination." Id. at 90 S.Ct. 1020. Goldberg was followed by cases such as Matthews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893 (1976) in which the Court adopted a balancing approach requiring courts to weigh factors in determining exactly what process was due when considering due process claims. These factors are: First, the private interest that will be effected by the official action; second, the risk of an erroneous deprivation of the interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail. 96 S.Ct. at 903. Several years after Eldridge, the Supreme Court again addressed the issue in Memphis Light, Gas, and Water Division v. Kraft, 436 U.S. 1, 98 S.Ct. 1554 (1978). The case dealt with the circumstances under which the municipally-owned utility company could terminate utilities consistent with due process. The court held that the notice contained in the utility bill stating that payment was overdue and that service would be discontinued if payment was not made by a certain date was not reasonably calculated to inform customers of the availability of procedures for protesting proposed termination of the utility services and thus deprived customers of notice to which they were entitled under the due process clause. The case further held that due process required an opportunity for the presentation to a neutral decision maker of customer's complaints that he is being over charged or charged for services not rendered. Cases such as Goldberg, Matthews, and Memphis Light and Gas, provide an overview for the courts to look at in dealing with specific issues in the administration of government programs involving the distribution of entitlements. See, e.g., Bliek v. Palmer, 102 F.3d 1472 (8th Cir. 1997)(notice related to "agency error" and the collection of food stamp overpayments was not specific enough to comply with due process requirements); Ford v. Shalala, 87 F.Supp.2d 163 (E.D. N.Y. 1999)(due process violation for inadequacies in written notices to beneficiaries of supplemental security income program) and Rodriguez v. Chen, 985 F.Supp. 1189 (D. Ariz. 1996)(notices of termination inadequately stated reasons for termination from Medicaid and, therefore, violated due process). The defendant makes the argument that since the collection of child support is not an "entitlement" perhaps the recipients of the payments are entitled to either no or less due process. As with all courts that have addressed this issue, the Court is unimpressed by this argument. While the child support may belong to the child and not the custodian, no court has accepted the contention of the defendant that less process is due. The due process notice issue has been addressed by several courts related to state centralized child support collection and distribution systems. In Barnes v. Healy, 980 F.2d 572 (9th Cir. 1992) custodial parents in California brought an action alleging that the California Department of Social Services notice of child support collections and distributions was insufficient to satisfy procedural due process. Under the California process then in effect, a recipient of services received an annual notice, including the total amount of support collected, and if more than one absent parent was involved, a breakdown as to absent parent's payments for a year. The plaintiffs in the case alleged that this notice failed to provide the information necessary to evaluate the timing and accuracy of the agency's disbursement and thus violated due process. The appellate court agreed with the district court that the notices sent were inadequate and that recipients were entitled to a "meaningful" notice which would allow them to ascertain whether they had received all the payments to which they were entitled. The Court held that a "meaningful" notice at least included the date of collection because that date related to other computations, therefore, "providing class members with a date of collection is of great value in reducing the risk of erroneous nonpayments and underpayments of child support." Id. at 578. The court also held that for welfare recipients the notice had to contain an explanation if the recipient did not receive a "pass through" payment. The statute authorized a pass through of the first fifty dollars ($50.00) of any payments for the month received in that month, but there were circumstances in which pass through payments were not required. The court required the state to make the explanation if a pass through payment was not made. In Bennett v. White, 865 F.2d 1395 (3rd Cir. 1989) an action was brought challenging the manner in which Pennsylvania administered its child support enforcement program. There were a number of issues in the case, one of which was the lack of notice to recipients showing the amount of child support collected. The court held that the notice sent was inadequate and that in the future the notice must include, the agency's calculations of support payments and AFDC assistance payments against which they are being off-set. Id. at 1404. In Vanscoter v. Bowen, 706 F.Supp. 1432 (W.D. Wash. 1989) the court held that in the administration of the state wide child support collection system the state violated due process when it failed to provide adequate notice of the amount of child support the state receives on their account, on how the money is allocated and distributed, and of their right to a fair hearing on grievances. The court agreed and the order of the court was upheld on appeal. See Vanscoter v. Sullivan, 920 F.2d 1441 (9th Cir. 1990). There are several things that the Court cannot do. There is no doubt that when the state wide system went into effect in October, 1999 there were a number of problems related to the conversion. These problems caused a great deal of confusion, including misplaced or nonpayment to recipients. Many of these problems have now been addressed by the defendant and solved. Those remaining problems related to the administration are not a matter for court intervention unless they rise to the level of a constitutional or statutory violation. Courts cannot intervene because citizens or a citizen group thinks that a government operation might be more efficiently administered. It is further worth noting that the Court cannot intervene because a notice to recipients might be better worded, more simply worded, or more clearly expressed. Here again, the Court cannot intervene unless the notices sent violate constitutional standards.(13) The Court is also of the opinion that the defendant is correct when she asserts that the notices received by the recipients cannot be judged in a vacuum. These notices must be considered in light of all the other information available to the recipient through hand-outs, information services, and phone inquiries. The Court does agree, however, with the plaintiff's position that the availability of other sources of information cannot cure a totally deficient notice. The other information available has to be weighted in determining what the notice must contain. The Court agrees with cases such as Schroeder v. Hegstrom, 590 F.Supp. 121 (N.D. Ill. 1984), cited by the plaintiffs, in which the district court held that in a reduction of welfare benefit case "the notice must include at a minimum the amount of income that was counted, the amount of deduction which was allowed or disallowed, and any other figures that were used to calculate the grant." Id. at 130. The fact that recipients may ask for assistance from welfare caseworkers in understanding why the reduction or termination occurred does not remedy the short comings of an inadequate notice. As one court explained "it is true that defendant's notice invites the recipient to inquire further or to request a hearing, but this improperly places the burden of acquiring notice, whereas due process directs defendant to supply it..." Philadelphia Welfare Rights Organization v. Obannon, 525 F.Supp. at 1061. Id. at 128. The Court also recognizes as part of its due process analysis that a majority, if not a vast majority, of recipients of state child support collection services are economically marginal. A mistake in the amount of support received can have drastic consequences even if it involves a small error. An error that might be easily absorbed and later resolved without consequences for some causes a crisis for the poor, which means utility bills not being paid or meals missed. Based upon the record before it and the cross motions for partial summary judgment on the notice issue, the Court is inclined to find as follows: 1. The TCSES number must appear on all monthly notices and be clearly identified as such. The Court is aware that the defendant contends that this is already being done. The plaintiffs contend otherwise. Since the defendant already subscribes to this requirement, the entry of an order requiring them to include the TCSES number should impose no difficulty for the defendant. The TCSES number is of vital importance because it is used for access to all of the Department's customer information systems. See T.C.A. § 36-5-116(e)(1)(C) and (e)(2)(C).(14) 2. When the Department knows the amount of court-ordered support, which it should in almost all cases, that information should appear on the monthly notice. There is reported confusion among recipients as to what the Department believes is the amount of court-ordered support. Since it is that amount upon which the defendant bases her calculation(s), that amount should appear in the notice. 3. The Department engages in calculations related to "pass through payments" for Families First recipients as well as a collection of assigned and unassigned arrearages for former Families First recipients. The information given is presently insufficient to allow a determination if these computations are correct. The Court believes that if support collected is more than that sent to the recipient then the defendant should explain the reason. The defendant attempts to explain the calculation in the second paragraph of the notice's explanation page. However, again, such is not sufficient in that it does not provide the information used in determining the amount retained in each individual case. This could be done by the simple indication of such reasons as "past assigned arrearage" or "current assigned arrearage for Families First" or the like. While this information is short of that contended as necessary by plaintiff it is sufficient information to alert the recipient to possible problems in calculation so as to allow further inquiry. 4. The "monthly notice of collection's" three (3) paragraph explanation should delete the sentence "if a minus (-) appears before a number on this notice it may be the result of a court order or case type change in your case." Whatever that means it must be understandably explained. 5. The notice of an administrative appeal is deficient. It should contain an explanation of the need to request a hearing within fifteen (15) days of an adverse decision after the conciliation process. See T.C.A. § 36-5-1002(a)(11)(A) and 36-5-1001(c)(1). The Court is aware that the form sent contains the fifteen (15) day notice, however, the Court is of the opinion that the initial right to appeal notice should alert the recipient to the fifteen (15) day requirement. Furthermore, the notice should allow for a request for conciliation to be made in writing and a clear statement of a right to a hearing if there is an adverse response or if there is no response in thirty (30) days. Also, the thirty (30) days for conciliation begins to run at "contact" not when a form is filled out and returned. The Court declines to undertake the massive reformation of the notice suggested by plaintiffs. The Court cannot order a "better" notice but rather, may only act to insure that the due process rights of recipients are protected by seeing that they receive sufficient information to "meaningfully" assess that they are receiving the child support to which they are entitled. The Court would also observe as to any ordered remedy that the Department of Human Services has every motivation to receive as much information as it can in order to correct mistakes to insure that children of this state who receive child support receive what they are entitled. In some sense this should not be a adversary matter and the Court believes that the Department welcomes input in order to see that children receive what they are entitled. See generally T.C.A. § 71-1-105. The Court has previously indicated that this matter would be bifurcated. Therefore, this case is set for further hearing to allow the parties to comment on the observations of the Court set out above and to determine if the numbered paragraphs set out above should be made the order of the court. The parties may address issues of implementation at the hearing. This hearing is set for June 21, 2001 at 1:15 p.m. The parties are to meet prior to that date to see if this notice issue could be resolved by an agreed order incorporating the above and/or consider the offer of General Counsel Russell to discuss revision of the notice and forms satisfactory to the Department and to the representatives of the class.
This the _____ day of _____________, 2001.
_________________________ xc: Brian Paddock
Stuart F. Wilson-Patton 1. See Tenn. Code Ann. § 36-5-116. 2. Families First is the current program for what was formerly known as AFDC. Families First provides cash grants, education, job training, child care, employment assistance, and transitional benefits to poor or low income Tennesseans working toward a lifestyle without welfare. Families First, which went into effect on September 1, 1996, was approved by the U. S. Department of Health and Human Services before Congress passed its version of federally mandated welfare reform. See 42 U.S.C. § 608 and T.C.A. § 71-3-151. 3. See Tenn. Code Ann. § 71-3-124. Recipients of Families First assign all rights to the collection of child support to the defendant. The defendant then collects the child support, issues a pass through payment to the custodial parent, as more fully described below, and retains the remainder. 5. See T.C.A. §§ 36-5-101 & 36-5-501. 6. See 42 U.S.C. § 654b(a)(1)(B); T.C.A. § 36-5-116. 7. There is some confusion in the record as to whether the TCSES number is on the notice. The State says that it is, although the plaintiffs' counsel contends that the number, called a "member number," is not the TCSES number. There is no doubt that the State intends the TCSES number to be on the monthly notice. 8. The standard of need for each fiscal year is determined on July 1. T.C.A. § 71-3-155(e). 9. When support is collected by the IV-D agency in behalf of an [assisted group] receiving Families First cash assistance, the collected amount of support will be paid to the [assisted group] in an amount up to the less of the collection or the [assisted group's] need. (a) Unmet need is determined by subtracting the following from the [assisted group's] consolidated need standard: 1. the grant amount paid to the assisted group in the month the collection is received by the IV-D agency; and 2. the income counted in the budget to determine the amount of the [assisted group's] grant in the month the collection is received by the IV-D agency. Tenn. Comp. R. & Reg 1240-1-48-.07. 10. The affidavit of Richard Paige dated March 30, 2001 provides a more detailed description of the various types and classifications of arrearages. 11. The defendant's local child support offices provide to every custodial parent receiving IV-D services, including current and former welfare recipients, a copy of the court order establishing or modifying a child support award. 12. Under state and federal law, the state, if the support has been assigned, has a right to intercept a federal tax refund and apply an offset to any arrearages owed. See 42 U.S.C. § 664; T.C.A. § 36-5-103(d). Plaintiffs contend that these payments should be separately identified because they must be used to repay unreimbursed assistance as the first priority for distribution. Barnes v. Healy, 980 F.2d 572, 579 n.4 (9th Cir. 1992). 13. The General Counsel of the Department, William Russell, by filed affidavit has indicated that the Department is willing to consider revising its notices and appeal forms to simplify the language and make them clearer. 14. The TCSES number for some recipients does not become a statutory requirement until April 1, 2002. |
