I 

108TH CONGRESS 

2D SESSION H. R. 4859 

To amend part D of title IV of the Social Security Act to improve the 

collection of child support, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 19, 2004 

Mr. KENNEDY of Minnesota (for himself, Mr. DAVIS of Alabama, Mr. 

BEAUPREZ, Mr. SESSIONS, and Mr. CARDOZA) introduced the following 

bill; which was referred to the Committee on Ways and Means, and in 

addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such 

provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend part D of title IV of the Social Security Act 

to improve the collection of child support, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Child Support Im5 provement Act of 2004’’. 

6 SEC. 2. TABLE OF CONTENTS. 

7 The table of contents of this Act is as follows: 

Sec. 1. Short title. 
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Sec. 2. Table of contents. 

TITLE I—DISTRIBUTION OF CHILD SUPPORT 

Sec. 101. Distribution of child support collected by States on behalf of children 

receiving certain welfare benefits. 

TITLE II—EXPANDED ENFORCEMENT 

Sec. 201. Decrease in amount of child support arrearage triggering passport 

denial. 

Sec. 202. Use of tax refund intercept program to collect past-due child support 

on behalf of children who are not minors. 

Sec. 203. Garnishment of compensation paid to veterans for service-connected 

disabilities in order to enforce child support obligations. 

Sec. 204. Improved interstate enforcement. 

TITLE III—MISCELLANEOUS 

Sec. 301. Report on undistributed child support payments. 

Sec. 302. Use of new hire information to assist in administration of unemployment compensation programs. 

Sec. 303. Improving Federal debt collection practices. 

Sec. 304. Maintenance of technical assistance funding. 

Sec. 305. Maintenance of Federal parent locator service funding. 

Sec. 306. Electronic disbursement of child support payments to families. 

Sec. 307. Optional expansion of State disbursement unit to create a centralized 

payment location for all child support wage withholding. 

Sec. 308. Implemention of medical support performance measure. 

Sec. 309. Authority to continue State program for monitoring and enforcement 

of child support orders. 

TITLE IV—EFFECTIVE DATE 

Sec. 401. Effective date. 

1 TITLE I—DISTRIBUTION OF 

2 CHILD SUPPORT 

3 SEC. 101. DISTRIBUTION OF CHILD SUPPORT COLLECTED 

4 BY STATES ON BEHALF OF CHILDREN RE5 CEIVING CERTAIN WELFARE BENEFITS. 

6 (a) MODIFICATION OF RULE REQUIRING ASSIGN7 MENT OF SUPPORT RIGHTS AS A CONDITION OF RECEIV8 ING TANF.—Section 408(a)(3) of the Social Security Act 

9 (42 U.S.C. 608(a)(3)) is amended to read as follows: 
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1 ‘‘(3) NO ASSISTANCE FOR FAMILIES NOT AS2 SIGNING CERTAIN SUPPORT RIGHTS TO THE

3 STATE.—A State to which a grant is made under 

4 section 403 shall require, as a condition of paying 

5 assistance to a family under the State program 

6 funded under this part, that a member of the family 

7 assign to the State any right the family member 

8 may have (on behalf of the family member or of any 

9 other person for whom the family member has ap10 plied for or is receiving such assistance) to support 

11 from any other person, not exceeding the total 

12 amount of assistance so paid to the family, which ac13 crues during the period that the family receives as14 sistance under the program.’’. 

15 (b) INCREASING CHILD SUPPORT PAYMENTS TO

16 FAMILIES AND SIMPLIFYING CHILD SUPPORT DISTRIBU17 TION RULES.— 

18 (1) DISTRIBUTION RULES.— 

19 (A) IN GENERAL.—Section 457(a) of the 

20 Social Security Act (42 U.S.C. 657(a)) is 

21 amended to read as follows: 

22 ‘‘(a) IN GENERAL.—Subject to subsections (e) and 

23 (f), the amounts collected on behalf of a family as support 

24 by a State pursuant to a plan approved under this part 

25 shall be distributed as follows: 
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1 ‘‘(1) FAMILIES RECEIVING ASSISTANCE.—In the 

2 case of a family receiving assistance from the State, 

3 the State shall— 

4 ‘‘(A) pay to the Federal Government the 

5 Federal share of the amount collected, subject 

6 to paragraph (3)(A); 

7 ‘‘(B) retain, or pay to the family, the State 

8 share of the amount collected, subject to para9 graph (3)(B); and 

10 ‘‘(C) pay to the family any remaining 

11 amount. 

12 ‘‘(2) FAMILIES THAT FORMERLY RECEIVED AS13 SISTANCE.—In the case of a family that formerly re14 ceived assistance from the State: 

15 ‘‘(A) CURRENT SUPPORT.—To the extent 

16 that the amount collected does not exceed the 

17 current support amount, the State shall pay the 

18 amount to the family. 

19 ‘‘(B) ARREARAGES.—Except as otherwise 

20 provided in an election made under 454(34), to 

21 the extent that the amount collected exceeds the 

22 current support amount, the State— 

23 ‘‘(i) shall first pay to the family the 

24 excess amount, to the extent necessary to 
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1 satisfy support arrearages not assigned 

2 pursuant to section 408(a)(3); 

3 ‘‘(ii) if the amount collected exceeds 

4 the amount required to be paid to the fam5 ily under clause (i), shall— 

6 ‘‘(I) pay to the Federal Govern7 ment, the Federal share of the excess 

8 amount described in this clause, sub9 ject to paragraph (3)(A); and 

10 ‘‘(II) retain, or pay to the family, 

11 the State share of the excess amount 

12 described in this clause, subject to 

13 paragraph (3)(B); and 

14 ‘‘(iii) shall pay to the family any re15 maining amount. 

16 ‘‘(3) LIMITATIONS.— 

17 ‘‘(A) FEDERAL REIMBURSEMENTS.—The 

18 total of the amounts paid by the State to the 

19 Federal Government under paragraphs (1) and 

20 (2) of this subsection with respect to a family 

21 shall not exceed the Federal share of the 

22 amount assigned with respect to the family pur23 suant to section 408(a)(3). 

24 ‘‘(B) STATE REIMBURSEMENTS.—The 

25 total of the amounts retained by the State 
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1 under paragraphs (1) and (2) of this subsection 

2 with respect to a family shall not exceed the 

3 State share of the amount assigned with respect 

4 to the family pursuant to section 408(a)(3). 

5 ‘‘(4) FAMILIES THAT NEVER RECEIVED ASSIST6 ANCE.—In the case of any other family, the State 

7 shall pay the amount collected to the family. 

8 ‘‘(5) FAMILIES UNDER CERTAIN AGREE9 MENTS.—Notwithstanding paragraphs (1) through 

10 (3), in the case of an amount collected for a family 

11 in accordance with a cooperative agreement under 

12 section 454(33), the State shall distribute the 

13 amount collected pursuant to the terms of the agree14 ment. 

15 ‘‘(6) STATE FINANCING OPTIONS.—To the ex16 tent that the State’s share of the amount payable to 

17 a family pursuant to paragraph (2)(B) of this sub18 section exceeds the amount that the State estimates 

19 (under procedures approved by the Secretary) would 

20 have been payable to the family pursuant to former 

21 section 457(a)(2)(B) (as in effect for the State im22 mediately before the date this subsection first ap23 plies to the State) if such former section had re24 mained in effect, the State may elect to have the 
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1 payment considered a qualified State expenditure for 

2 purposes of section 409(a)(7). 

3 ‘‘(7) STATE OPTION TO PASS THROUGH ADDI4 TIONAL SUPPORT WITH FEDERAL FINANCIAL PAR5 TICIPATION.— 

6 ‘‘(A) FAMILIES THAT FORMERLY RE7 CEIVED ASSISTANCE.—Notwithstanding para8 graph (2), a State shall not be required to pay 

9 to the Federal Government the Federal share of 

10 an amount collected on behalf of a family that 

11 formerly received assistance from the State to 

12 the extent that the State pays the amount to 

13 the family. 

14 ‘‘(B) FAMILIES THAT CURRENTLY RE15 CEIVE ASSISTANCE.— 

16 ‘‘(i) IN GENERAL.—Notwithstanding 

17 paragraph (1), in the case of a family that 

18 receives assistance from the State, a State 

19 shall not be required to pay to the Federal 

20 Government the Federal share of the ex21 cepted portion (as defined in clause (ii)) of 

22 any amount collected on behalf of such 

23 family during a month to the extent that— 

24 ‘‘(I) the State pays the excepted 

25 portion to the family; and 
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1 ‘‘(II) the excepted portion is dis2 regarded in determining the amount 

3 and type of assistance provided to the 

4 family under such program. 

5 ‘‘(ii) EXCEPTED PORTION DEFINED.— 

6 For purposes of this subparagraph, the 

7 term ‘excepted portion’ means that portion 

8 of the amount collected on behalf of a fam9 ily during a month that does not exceed 

10 $400 per month, or in the case of a family 

11 that includes 2 or more children, that does 

12 not exceed an amount established by the 

13 State that is not more than $600 per 

14 month. 

15 ‘‘(8) STATES WITH DEMONSTRATION WAIV16 ERS.—Notwithstanding the preceding paragraphs, in 

17 the case of a State that, on the date of enactment 

18 of this paragraph, has had in effect since October 1, 

19 1997, a waiver under section 1115 permitting pass 

20 through payments of child support collections— 

21 ‘‘(A) the State may continue to distribute 

22 such payments to families without regard to the 

23 expiration date of such waiver; and 

24 ‘‘(B) the requirement under paragraph (1) 

25 to pay to the Federal Government the Federal 
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1 share of the amount collected on behalf of a 

2 family shall not apply to the extent that— 

3 ‘‘(i) the State distributes such amount 

4 to the family; and 

5 ‘‘(ii) such amount is disregarded in 

6 determining the amount and type of assist7 ance paid to the family.’’. 

8 (B) STATE PLAN TO INCLUDE ELECTION

9 AS TO WHICH RULES TO APPLY IN DISTRIB10 UTING CHILD SUPPORT ARREARAGES COL11 LECTED ON BEHALF OF FAMILIES FORMERLY

12 RECEIVING ASSISTANCE.—Section 454 of the 

13 Social Security Act (42 U.S.C. 654) is amend14 ed— 

15 (i) by striking ‘‘and’’ at the end of 

16 paragraph (32); 

17 (ii) by striking the period at the end 

18 of paragraph (33) and inserting ‘‘; and’’; 

19 and 

20 (iii) by inserting after paragraph (33) 

21 the following: 

22 ‘‘(34) include an election by the State to apply 

23 section 457(a)(2)(B) of this Act or former section 

24 457(a)(2)(B) of this Act (as in effect for the State 

25 immediately before the date this paragraph first ap-
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1 plies to the State) to the distribution of the amounts 

2 which are the subject of such sections, and for so 

3 long as the State elects to so apply such former sec4 tion, the amendments made by subsection (e) of sec5 tion 101 of the Child Support Improvement Act of 

6 2004 shall not apply with respect to the State, not7 withstanding subsection (f)(1) of such section 101.’’. 

8 (C) APPROVAL OF ESTIMATION PROCE9 DURES.—Not later than the date that is 6 

10 months after the date of enactment of this Act, 

11 the Secretary of Health and Human Services, 

12 in consultation with the States (as defined for 

13 purposes of part D of title IV of the Social Se14 curity Act), shall establish the procedures to be 

15 used to make the estimate described in section 

16 457(a)(6) of such Act. 

17 (2) CURRENT SUPPORT AMOUNT DEFINED.— 

18 Section 457(c) of the Social Security Act (42 U.S.C. 

19 657(c)) is amended by adding at the end the fol20 lowing: 

21 ‘‘(5) CURRENT SUPPORT AMOUNT.—The term 

22 ‘current support amount’ means, with respect to 

23 amounts collected as support on behalf of a family, 

24 the amount designated as the monthly support obli-
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1 gation of the noncustodial parent in the order re2 quiring the support.’’. 

3 (c) BAN ON RECOVERY OF MEDICAID COSTS FOR

4 CERTAIN BIRTHS.—Section 454 of the Social Security Act 

5 (42 U.S.C. 654), as amended by subsection (b)(1)(B), is 

6 amended— 

7 (1) by striking ‘‘and’’ at the end of paragraph 

8 (33); 

9 (2) by striking the period at the end of para10 graph (34) and inserting ‘‘; and’’; and 

11 (3) by inserting after paragraph (34) the fol12 lowing: 

13 ‘‘(35) provide that the State shall not use the 

14 State program operated under this part to collect 

15 any amount owed to the State by reason of costs in16 curred under the State plan approved under title 

17 XIX for the birth of a child for whom support rights 

18 have been assigned pursuant to section 408(a)(3), 

19 471(a)(17), or 1912.’’. 

20 (d) STATE OPTION TO DISCONTINUE OLDER SUP21 PORT ASSIGNMENTS.—Section 457(b) of the Social Secu22 rity Act (42 U.S.C. 657(b)) is amended to read as follows: 

23 ‘‘(b) CONTINUATION OF ASSIGNMENTS.— 

24 ‘‘(1) STATE OPTION TO DISCONTINUE PRE-1997

25 SUPPORT ASSIGNMENTS.— 
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1 ‘‘(A) IN GENERAL.—Any rights to support 

2 obligations assigned to a State as a condition of 

3 receiving assistance from the State under part 

4 A and in effect on September 30, 1997 (or such 

5 earlier date on or after August 22, 1996, as the 

6 State may choose), may remain assigned after 

7 such date. 

8 ‘‘(B) DISTRIBUTION OF AMOUNTS AFTER

9 ASSIGNMENT DISCONTINUATION.—If a State 

10 chooses to discontinue the assignment of a sup11 port obligation described in subparagraph (A), 

12 the State may treat amounts collected pursuant 

13 to such assignment as if such amounts had 

14 never been assigned and may distribute such 

15 amounts to the family in accordance with sub16 section (a)(4). 

17 ‘‘(2) STATE OPTION TO DISCONTINUE POST-1997

18 SUPPORT ASSIGNMENTS.— 

19 ‘‘(A) IN GENERAL.—Any rights to support 

20 obligations accruing before the date on which a 

21 family first receives assistance under part A 

22 that are assigned to a State under that part 

23 and in effect before the implementation date of 

24 this section may remain assigned after such 

25 date. 
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1 ‘‘(B) DISTRIBUTION OF AMOUNTS AFTER

2 ASSIGNMENT DISCONTINUATION.—If a State 

3 chooses to discontinue the assignment of a sup4 port obligation described in subparagraph (A), 

5 the State may treat amounts collected pursuant 

6 to such assignment as if such amounts had 

7 never been assigned and may distribute such 

8 amounts to the family in accordance with sub9 section (a)(4).’’. 

10 (e) CONFORMING AMENDMENTS.— 

11 (1) Section 404(a) of the Social Security Act 

12 (42 U.S.C. 604(a)) is amended— 

13 (A) by striking ‘‘or’’ at the end of para14 graph (1); 

15 (B) by striking the period at the end of 

16 paragraph (2) and inserting ‘‘; or’’; and 

17 (C) by adding at the end the following: 

18 ‘‘(3) to fund payment of an amount pursuant to 

19 clause (i) or (ii) of section 457(a)(2)(B), but only to 

20 the extent that the State properly elects under sec21 tion 457(a)(6) to use the grant to fund the pay22 ment.’’. 

23 (2) Section 409(a)(7)(B)(i) of such Act (42 

24 U.S.C. 609(a)(7)(B)(i)) is amended— 
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1 (A) in subclause (I)(aa), by striking 

2 ‘‘457(a)(1)(B)’’ and inserting ‘‘457(a)(1)’’; and 

3 (B) by adding at the end the following: 

4 ‘‘(V) PORTIONS OF CERTAIN

5 CHILD SUPPORT PAYMENTS COL6 LECTED ON BEHALF OF AND DISTRIB7 UTED TO FAMILIES NO LONGER RE8 CEIVING ASSISTANCE.—Any amount 

9 paid by a State pursuant to clause (i) 

10 or (ii) of section 457(a)(2)(B), but 

11 only to the extent that the State prop12 erly elects under section 457(a)(6) to 

13 have the payment considered a quali14 fied State expenditure.’’. 

15 (3) Section 6402(c) of the Internal Revenue 

16 Code of 1986 (relating to offset of past-due support 

17 against overpayments) is amended— 

18 (A) in the first sentence, by striking ‘‘the 

19 Social Security Act.’’ and inserting ‘‘of such 

20 Act.’’; and 

21 (B) by striking the third sentence and in22 serting the following: ‘‘The Secretary shall 

23 apply a reduction under this subsection first to 

24 an amount certified by the State as past due 

25 support under section 464 of the Social Secu-
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1 rity Act before any other reductions allowed by 

2 law.’’. 

3 (f) EFFECTIVE DATE.— 

4 (1) IN GENERAL.—The amendments made by 

5 this section shall take effect on October 1, 2007, 

6 and shall apply to payments under parts A and D 

7 of title IV of the Social Security Act for calendar 

8 quarters beginning on or after such date, and with9 out regard to whether regulations to implement such 

10 amendments (in the case of State programs operated 

11 under such part D) are promulgated by such date. 

12 (2) STATE OPTION TO ACCELERATE EFFECTIVE

13 DATE.—A State may elect to have the amendments 

14 made by this section apply to the State and to 

15 amounts collected by the State and to payments 

16 under parts A and D of title IV of the Social Secu17 rity Act, on and after such date as the State may 

18 select that is after the date of enactment of this Act 

19 and before October 1, 2007. 
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1 TITLE II—EXPANDED 

2 ENFORCEMENT 

3 SEC. 201. DECREASE IN AMOUNT OF CHILD SUPPORT AR4 REARAGE TRIGGERING PASSPORT DENIAL. 

5 (a) IN GENERAL.—Section 452(k)(1) of the Social 

6 Security Act (42 U.S.C. 652(k)(1)) is amended by striking 

7 ‘‘$5,000’’ and inserting ‘‘$2,500’’. 

8 (b) CONFORMING AMENDMENT.—Section 454(31) of 

9 the Social Security Act (42 U.S.C. 654(31)) is amended 

10 by striking ‘‘$5,000’’ and inserting ‘‘$2,500’’. 

11 SEC. 202. USE OF TAX REFUND INTERCEPT PROGRAM TO 

12 COLLECT PAST-DUE CHILD SUPPORT ON BE13 HALF OF CHILDREN WHO ARE NOT MINORS. 

14 Section 464 of the Social Security Act (42 U.S.C. 

15 664) is amended— 

16 (1) in subsection (a)(2)(A), by striking ‘‘(as 

17 that term is defined for purposes of this paragraph 

18 under subsection (c))’’; and 

19 (2) in subsection (c)— 

20 (A) in paragraph (1)— 

21 (i) by striking ‘‘(1) Except as pro22 vided in paragraph (2), as used in’’; and 

23 inserting ‘‘In’’; and 
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1 (ii) by inserting ‘‘(whether or not a 

2 minor)’’ after ‘‘a child’’ each place it ap3 pears; and 

4 (B) by striking paragraphs (2) and (3). 

5 SEC. 203. GARNISHMENT OF COMPENSATION PAID TO VET6 ERANS FOR SERVICE-CONNECTED DISABIL7 ITIES IN ORDER TO ENFORCE CHILD SUP8 PORT OBLIGATIONS. 

9 Section 459(h) of the Social Security Act (42 U.S.C. 

10 659(h)) is amended— 

11 (1) in paragraph (1)(A)(ii)— 

12 (A) in subclause (IV), by striking ‘‘or’’ 

13 after the semicolon; 

14 (B) in subclause (V), by inserting ‘‘or’’ 

15 after the semicolon; and 

16 (C) by adding at the end the following: 

17 ‘‘(VI) subject to paragraph (3), 

18 other than periodic benefits or pay19 ments described in subclause (V), by 

20 the Secretary of Veterans Affairs as 

21 compensation for a service-connected 

22 disability paid by the Secretary to a 

23 former member of the Armed 

24 Forces;’’; and 

25 (2) by adding at the end the following: 
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1 ‘‘(3) LIMITATIONS WITH RESPECT TO COM2 PENSATION PAID TO VETERANS FOR SERVICE-CON3 NECTED DISABILITIES.— 

4 ‘‘(A) ALIMONY AND CHILD SUPPORT.— 

5 Subject to subparagraph (B), compensation de6 scribed in paragraph (1)(A)(ii)(VI) shall not be 

7 subject to withholding pursuant to this sec8 tion— 

9 ‘‘(i) for payment of alimony; or 

10 ‘‘(ii) for payment of child support if 

11 the individual is fewer than 60 days in ar12 rears in payment of the support. 

13 ‘‘(B) LIMITATION.—Not more than 50 per14 cent of any payment of compensation described 

15 in subparagraph (A) may be withheld pursuant 

16 to this section.’’. 

17 SEC. 204. IMPROVED INTERSTATE ENFORCEMENT. 

18 (a) IN GENERAL.—Section 466(f) (42 U.S.C. 666(f)) 

19 is amended— 

20 (1) by striking ‘‘January 1, 1998’’ and insert21 ing ‘‘January 1, 2005’’; 

22 (2) by striking ‘‘and as in effect on August 22, 

23 1996,’’; and 

24 (3) by striking ‘‘adopted as of such date’’ and 

25 inserting ‘‘adopted as of August, 2001’’. 
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1 (b) FULL FAITH AND CREDIT FOR CHILD SUPPORT

2 ORDERS.—Section 1738B of title 28, United States Code, 

3 is amended— 

4 (1) by striking subsection (d) and inserting the 

5 following: 

6 ‘‘(d) CONTINUING EXCLUSIVE JURISDICTION.— 

7 ‘‘(1) IN GENERAL.—Subject to paragraph (2), a 

8 court of a State that has made a child support order 

9 consistent with this section has continuing, exclusive 

10 jurisdiction to modify its order if the order is the 

11 controlling order and— 

12 ‘‘(A) the State is the child’s State or the 

13 residence of any individual contestant; or 

14 ‘‘(B) if the State is not the residence of 

15 the child or an individual contestant, the con16 testants consent in a record or in open court 

17 that the court may continue to exercise jurisdic18 tion to modify its order. 

19 ‘‘(2) REQUIREMENT.—A court may not exercise 

20 its continuing, exclusive jurisdiction to modify the 

21 order if the court of another State, acting in accord22 ance with subsections (e) and (f), has made a modi23 fication of the order.’’; 

24 (2) in subsection (e)(2)— 
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1 (A) in subparagraph (A), by striking ‘‘be2 cause’’ and all that follows through the semi3 colon and inserting ‘‘pursuant to paragraph (1) 

4 or (2) of subsection (d);’’ and 

5 (B) in subparagraph (B), by inserting 

6 ‘‘with jurisdiction over at least 1 of the indi7 vidual contestants or that is located in the 

8 child’s State’’ after ‘‘another State’’; 

9 (3) in subsection (f)— 

10 (A) in the subsection heading, by striking 

11 ‘‘RECOGNITION OF CHILD SUPPORT ORDERS’’ 

12 and inserting ‘‘DETERMINATION OF CONTROL13 LING CHILD SUPPORT ORDER’’; 

14 (B) in the matter preceding paragraph (1), 

15 by striking ‘‘shall apply’’ and all that follows 

16 through the colon and inserting ‘‘having per17 sonal jurisdiction over both individual contest18 ants shall apply the following rules and by 

19 order shall determine which order controls:’’; 

20 (C) in paragraph (1), by striking ‘‘must 

21 be’’ and inserting ‘‘controls and must be so’’; 

22 (D) in paragraph (2), by striking ‘‘must be 

23 recognized’’ and inserting ‘‘controls’’; 
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1 (E) in paragraph (3), by striking ‘‘must be 

2 recognized’’ each place it appears and inserting 

3 ‘‘controls’’; 

4 (F) in paragraph (4)— 

5 (i) by striking ‘‘may’’ and inserting 

6 ‘‘shall’’; and 

7 (ii) by striking ‘‘must be recognized’’ 

8 and inserting ‘‘controls’’; and 

9 (G) by striking paragraph (5); 

10 (4) by striking subsection (g) and inserting the 

11 following: 

12 ‘‘(g) ENFORCEMENT OF MODIFIED ORDERS.—If a 

13 child support order issued by a court of a State is modified 

14 by a court of another State which properly assumed juris15 diction, the issuing court— 

16 ‘‘(1) may enforce its order that was modified 

17 only as to arrears and interest accruing before the 

18 modification; 

19 ‘‘(2) may provide appropriate relief for viola20 tions of its order which occurred before the effective 

21 date of the modification; and 

22 ‘‘(3) shall recognize the modifying order of the 

23 other State for the purpose of enforcement.’’; 

24 (5) in subsection (h)— 
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1 (A) in paragraph (1), by striking ‘‘and 

2 (3)’’ and inserting ‘‘, (3), and (4)’’; 

3 (B) in paragraph (2), by inserting ‘‘the 

4 computation and payment of arrearages, and 

5 the accrual of interest on the arrearages,’’ after 

6 ‘‘obligations of support,’’; and 

7 (C) by adding at the end the following: 

8 ‘‘(4) PROSPECTIVE APPLICATION.—After a 

9 court determines which is the controlling order and 

10 issues an order consolidating arrears, if any, a court 

11 shall prospectively apply the law of the State issuing 

12 the controlling order, including that State’s law with 

13 respect to interest on arrears, current and future 

14 support, and consolidated arrears.’’; and 

15 (6) in subsection (i), by inserting ‘‘and sub16 section (d)(2) does not apply’’ after ‘‘issuing State’’. 

17 TITLE III—MISCELLANEOUS 

18 SEC. 301. REPORT ON UNDISTRIBUTED CHILD SUPPORT 

19 PAYMENTS. 

20 Not later than 6 months after the date of enactment 

21 of this Act, the Secretary of Health and Human Services 

22 shall submit to the Committee on Finance of the Senate 

23 and the Committee on Ways and Means of the House of 

24 Representatives a report on the procedures that the States 

25 use generally to locate custodial parents for whom child 
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1 support has been collected but not yet distributed. The 

2 report shall include— 

3 (1) an estimate of the total amount of undis4 tributed child support; 

5 (2) an estimate of the average length of time it 

6 takes undistributed child support to be identified 

7 and distributed; and 

8 (3) recommendations— 

9 (A) as to whether additional procedures, 

10 including incentives, should be established at 

11 the Federal or State level to— 

12 (i) reduce the backlog of undistributed 

13 child support; 

14 (ii) close cases in compliance with reg15 ulatory standards in which the custodial 

16 parent cannot be located; 

17 (iii) expedite the payment of undis18 tributed child support; and 

19 (iv) establish measures to help man20 age the growth in the level of undistributed 

21 child support; and 

22 (B) for measures to evaluate State per23 formance with respect to undistributed child 

24 support payments. 
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1 SEC. 302. USE OF NEW HIRE INFORMATION TO ASSIST IN 

2 ADMINISTRATION OF UNEMPLOYMENT COM3 PENSATION PROGRAMS. 

4 (a) IN GENERAL.—Section 453(j) of the Social Secu5 rity Act (42 U.S.C. 653(j)) is amended by adding at the 

6 end the following: 

7 ‘‘(7) INFORMATION COMPARISONS AND DISCLO8 SURE TO ASSIST IN ADMINISTRATION OF UNEMPLOY9 MENT COMPENSATION PROGRAMS.— 

10 ‘‘(A) IN GENERAL.—If a State agency re11 sponsible for the administration of an unem12 ployment compensation program under Federal 

13 or State law transmits to the Secretary the 

14 name and social security account number of an 

15 individual, the Secretary shall, if the informa16 tion in the National Directory of New Hires in17 dicates that the individual may be employed, 

18 disclose to the State agency the name, address, 

19 and employer identification number of any pu20 tative employer of the individual, subject to this 

21 paragraph. 

22 ‘‘(B) CONDITION ON DISCLOSURE.—The 

23 Secretary shall make a disclosure under sub24 paragraph (A) only to the extent that the Sec25 retary determines that the disclosure would not 
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1 interfere with the effective operation of the pro2 gram under this part. 

3 ‘‘(C) USE OF INFORMATION.—A State 

4 agency may use information provided under this 

5 paragraph only for purposes of administering a 

6 program referred to in subparagraph (A).’’. 

7 (b) EFFECTIVE DATE.—The amendment made by 

8 this section shall take effect on October 1, 2001. 

9 SEC. 303. IMPROVING FEDERAL DEBT COLLECTION PRAC10 TICES. 

11 (a) IN GENERAL.—Section 3716(h)(3) of title 31, 

12 United States Code, is amended to read as follows: 

13 ‘‘(3) In applying this subsection with respect to any 

14 debt owed to a State, other than past due support being 

15 enforced by the State, subsection (c)(3)(A) shall not apply. 

16 Subsection (c)(3)(A) shall apply with respect to past due 

17 support being enforced by the State notwithstanding any 

18 other provision of law, including sections 207 and 

19 1631(d)(1) of the Social Security Act (42 U.S.C. 407 and 

20 1383(d)(1)), section 413(b) of Public Law 91–173 (30 

21 U.S.C. 923(b)), and section 14 of the Act of August 29, 

22 1935 (45 U.S.C. 231m).’’. 

23 (b) EFFECTIVE DATE.—The amendment made by 

24 subsection (a) shall take effect on October 1, 2004. 
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1 SEC. 304. MAINTENANCE OF TECHNICAL ASSISTANCE 

2 FUNDING. 

3 Section 452(j) of the Social Security Act (42 U.S.C. 

4 652(j)) is amended by inserting ‘‘or the amount appro5 priated under this paragraph for fiscal year 2002, which6 ever is greater,’’ before ‘‘which shall be available’’. 

7 SEC. 305. MAINTENANCE OF FEDERAL PARENT LOCATOR 

8 SERVICE FUNDING. 

9 Section 453(o) of the Social Security Act (42 U.S.C. 

10 653(o)) is amended— 

11 (1) in the first sentence, by inserting ‘‘or the 

12 amount appropriated under this paragraph for fiscal 

13 year 2002, whichever is greater’’ before ‘‘, which 

14 shall be available’’; and 

15 (2) in the second sentence, by striking ‘‘for 

16 each of fiscal years 1997 through 2001’’. 

17 SEC. 306. ELECTRONIC DISBURSEMENT OF CHILD SUPPORT 

18 PAYMENTS TO FAMILIES. 

19 Section 454A(g) of the Social Security Act (42 

20 U.S.C. 654a(g)) is amended by inserting at the end the 

21 following: 

22 ‘‘(3) ELECTRONIC DISBURSEMENT REQUIRE23 MENT.— 

24 ‘‘(A) IN GENERAL.—Not later than Octo25 ber 1, 2008, each State disbursement unit oper26 ated under section 454B shall implement a sys-
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1 tem to electronically disburse, through direct 

2 deposit or a widely accessible card-based sys3 tem, all child support collections disbursed to 

4 families under that section. 

5 ‘‘(B) STATE OPTION TO REQUIRE CARD6 BASED PAYMENT.—A State may require a pay7 ment recipient to accept payment through a 

8 card-based system if the recipient has declined 

9 to accept payment by direct deposit or does not 

10 have an account to which payment may be 

11 made by direct deposit. 

12 ‘‘(C) OPT-OUT.—Notwithstanding subpara13 graph (A), a State disbursement unit may 

14 maintain a nonelectronic system for disbursing 

15 child support collections to custodial parents 

16 under section 454B after October 1, 2008, if 

17 the State notifies the Secretary in writing by 

18 October 1, 2008, that the State intends to 

19 maintain such a system.’’. 

20 SEC. 307. OPTIONAL EXPANSION OF STATE DISBURSEMENT 

21 UNIT TO CREATE A CENTRALIZED PAYMENT 

22 LOCATION FOR ALL CHILD SUPPORT WAGE 

23 WITHHOLDING. 

24 Section 454B(a)(1)(B) of the Social Security Act (42 

25 U.S.C. 654b(a)(1)(B)) is amended by inserting ‘‘or, at 
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1 State option, all support orders, regardless of date 

2 issued,’’ after ‘‘in which the support order is initially 

3 issued in the State on or after January 1, 1994,’’. 

4 SEC. 308. IMPLEMENTATION OF MEDICAL SUPPORT PER5 FORMANCE MEASURE. 

6 (a) DEADLINE FOR IMPLEMENTATION OF PERFORM7 ANCE MEASURE.— 

8 (1) IN GENERAL.—Subject to paragraphs (2) 

9 and (3), the Secretary of Health and Human Serv10 ices (in this section referred to as the ‘‘Secretary’’) 

11 shall prescribe regulations to implement the per12 formance measure developed under section 

13 201(d)(2)(A) of the Child Support Performance and 

14 Incentive Act of 1998 (Public Law 105–200; 112 

15 Stat. 657). 

16 (2) REQUIREMENTS.—In prescribing such regu17 lations, the Secretary shall ensure that the perform18 ance measure described in paragraph (1) is imple19 mented in such a manner that the measure— 

20 (A) is based on reliable and accurate data; 

21 (B) ensures the discretion of States, in es22 tablishing and enforcing medical support obliga23 tions, to consider the forms of public and pri24 vate health care coverage most appropriate to 

25 each individual case; and 
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1 (C) encourages continual improvement in 

2 the effectiveness of States in establishing and 

3 enforcing such obligations. 

4 (3) DEADLINES.— 

5 (A) REGULATIONS.—The regulations re6 quired to be prescribed under paragraph (1) 

7 shall take effect not later than 3 years after the 

8 date of enactment of this Act. 

9 (B) INCORPORATION INTO INCENTIVE PAY10 MENT SYSTEM.—Not later than 2 years after 

11 the date that is the earlier of— 

12 (i) the date the regulations required 

13 to be prescribed under paragraph (1) take 

14 effect; or 

15 (ii) the date that is 3 years after the 

16 date of enactment of this Act, 

17 the Secretary shall, in a revenue neutral man18 ner, incorporate the regulations required to be 

19 prescribed under paragraph (1) into the incen20 tive payment system established by section 458 

21 of the Social Security Act (42 U.S.C. 658a). 

22 (b) INTERIM FUNDING.— 

23 (1) INCREASED FEDERAL SHARE OF EXPENDI24 TURES.—During the period described in paragraph 

25 (2), the Secretary, notwithstanding section 
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1 455(a)(1) of the Social Security Act (42 U.S.C. 

2 655(a)(1)), shall pay to each State for each quarter 

3 an amount equal to 90 percent of the total amount 

4 expended during the quarter that is attributable to 

5 the following: 

6 (A) Expenditures for such modification of 

7 the statewide automated system as is necessary 

8 to facilitate establishing and enforcement of 

9 medical support obligations under part D of 

10 title IV of the Social Security Act (42 U.S.C. 

11 651 et seq.). 

12 (B) Expenditures for the issuance of the 

13 National Medical Support Notice on behalf of a 

14 child described in section 454(4) and the proc15 essing of information received as a result of the 

16 issuance of such notice. 

17 (C) Expenditures for services to identify 

18 potential health care coverage for a child de19 scribed in section 454(4) and to enroll such a 

20 child in health care coverage through the 

21 issuance of a National Medical Support Notice. 

22 (2) PERIOD DESCRIBED.—For purposes of 

23 paragraph (1), the period described in this para24 graph is the period that— 
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1 (A) begins on the first day of the first 

2 quarter that begins at least 1 month after the 

3 date of enactment of this Act; and 

4 (B) ends on the last day of the first quar5 ter that begins at least 1 year after the date on 

6 which the Secretary certifies through a posting 

7 to an Internet website, that the regulations re8 quired to be prescribed under subsection (a)(1) 

9 are incorporated, in accordance with subsection 

10 (a)(3)(B), into the incentive payment system es11 tablished by section 458 of the Social Security 

12 Act (42 U.S.C. 658a). 

13 SEC. 309. AUTHORITY TO CONTINUE STATE PROGRAM FOR 

14 MONITORING AND ENFORCEMENT OF CHILD 

15 SUPPORT ORDERS. 

16 The Secretary of Health and Human Services shall 

17 not require the State of Texas, in operating the program 

18 established under part D of title IV of the Social Security 

19 Act, to apply for a waiver from the requirements of section 

20 454(4)(A)(ii) of such Act (42 U.S.C. 654(4)(A)(ii)) to 

21 continue to operate the State’s program for monitoring 

22 and enforcement of a court order without the necessity 

23 of a written application, as in effect on the date of enact24 ment of this Act. Such State may continue to operate such 

25 program and expand it to additional counties, as the State 
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1 determines necessary, without the necessity of applying for 

2 a waiver from the Secretary so long as an individual to 

3 whom the support is owed and who would otherwise have 

4 to sign a written application for services under such pro5 gram has an opportunity to decline such services. 

6 TITLE IV—EFFECTIVE DATE 

7 SEC. 401. EFFECTIVE DATE. 

8 (a) IN GENERAL.—Except as otherwise provided in 

9 this Act, and subject to subsection (b), this Act and the 

10 amendments made by this Act shall take effect on October 

11 1, 2004, and shall apply to payments under part D of title 

12 IV of the Social Security Act for calendar quarters begin13 ning on or after such date. 

14 (b) DELAY PERMITTED IF STATE LEGISLATION RE15 QUIRED.—In the case of a State plan approved under sec16 tion 454 of the Social Security Act (42 U.S.C. 654) which 

17 requires State legislation (other than legislation appro18 priating funds) in order for the plan to meet the additional 

19 requirements imposed by this Act or the amendments 

20 made by this Act, the State plan shall not be regarded 

21 as failing to comply with the additional requirements sole22 ly on the basis of the failure of the plan to meet the addi23 tional requirements before the first day of the first cal24 endar quarter beginning after the close of the first regular 

25 session of the State legislature that begins after the date 
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1 of the enactment of this Act. For purposes of the pre2 ceding sentence, in the case of a State that has a 2-year 

3 legislative session, each year of the session shall be consid4 ered to be a separate regular session of the State legisla5 ture. 

Æ