§576D-10 - Collection and disbursal of child support; direct payment exception.

§576D-10  Collection and disbursal of
child support; direct payment exception.  (a)  The agency shall collect and
disburse child support payments when an order requires the collection and
disbursal.  In the event of any default by the obligor, upon notification of
the default by the custodial parent, the agency shall proceed against the
obligor for the arrearage and the agency shall have jurisdiction over future
child support payments.  Notwithstanding any other law to the contrary, the
agency shall maintain a special interest bearing account for child support
payments.  Moneys collected by the agency for child support payments shall not
be deposited into the state treasury, but shall be deposited into this
account.  Moneys to be disbursed by the agency for child support payments shall
be disbursed from this account without appropriation or allotment.  The
interest realized from this account shall be used:

(1)  For related costs of the maintenance and
operation of the account; and

(2)  To improve the child support enforcement agency's
ability to promptly disburse payments to the custodial parent.

The balance shall be deposited into the state
treasury to the credit of the general fund.

(b)  Any child support payments required by a
court order effective on June 30, 1986, to be made to a court or clerk of the
court and disbursed to a custodial parent shall be made to the agency after
June 30, 1986.  The agency shall disburse the payments as appropriate under the
court order.

(c)  Other than for child support payments
disbursed to the department of human services or to another agency administering
a program under Title IV-D of the federal Social Security Act, the custodial
parent shall elect to receive child support payments from the agency by means
of an electronic benefits transfer system or by directly depositing the amount
into an account designated by the custodial parent.  If an election is not
made, the agency shall determine whether the disbursement of child support
payments shall be by means of an electronic benefits transfer system or by an
alternate method of disbursement that complies with the time frame required
under Title IV-D of the federal Social Security Act.

(d)  At the time a child support obligation is
first established or at any time thereafter, the court may approve an
alternative arrangement for the direct payment of child support from the
obligor to the custodial parent as an exception to the provisions for income
withholding through the agency, as required by sections 571-52.2(a)(1), 571-52.3,
and 576E-16(a).

(e)  The court may approve an alternative
arrangement for the direct payment of child support where either:

(1)  The obligor or custodial parent demonstrates and
the court finds that there is good cause not to require immediate withholding;
or

(2)  A written agreement is reached between the
obligor and the custodial parent and signed by both parties;

provided that in either case where child support has
been ordered previously, an alternative arrangement for direct payment shall be
approved only where the obligor provides proof of the timely payment of
previously ordered support.  For purposes of this section, good cause to
approve an alternative arrangement shall be based upon a determination by the
court, either in writing or on the record, that implementing income withholding
would not be in the best interests of the child.  Such a determination shall
include a statement setting forth the basis of the court's conclusion.

(f)  Any alternative arrangement for direct
payment shall provide that either parent may void the arrangement at any time
and apply for services from the agency to act as agent to receive payments from
the obligor parent.  The alternative arrangement for direct payment also shall
provide that, if the subject dependents of the obligor parent commence
receiving public assistance, including public assistance from the department of
human services under chapter 346, foster care under section 571-48, Title IV-E
or Title XIX of the federal Social Security Act (42 U.S.C. §1396), or if either
parent applies for services from the agency, the agency may immediately void
the direct payment arrangement by sending written notice by regular mail to the
custodial and obligor parents at their last known addresses, as disclosed in
the alternative arrangement agreement.

(g)  The alternative arrangement for direct
payment agreement shall include the most recent addresses of the custodial and
obligor parent.  If the obligor parent alleges direct payment of child support
to the custodial parent after the subject dependents of the court-approved
alternative arrangement become recipients of public assistance, including
public assistance from the department of human services under chapter 346,
foster care under section 571-48, Title IV-E or Title XIX of the federal Social
Security Act (42 U.S.C. §1396), or after the custodial parent applies for
services from the agency, and after receiving proper notification of the change
of payee to the agency, then the obligor shall have the burden of proving that
the child support payments were made by presenting written evidence, including
canceled checks or receipts.

(h)  No alternative arrangement for direct
payment shall be approved where the obligor or the custodial parent is
receiving services under Title IV-D of the federal Social Security Act or where
the dependents of the obligor receive public assistance, including public
assistance from the department of human services under chapter 346, foster care
under section 571-48, Title IV-E or Title XIX of the federal Social Security
Act (42 U.S.C. §1396), or where the obligor owes child support for a period
during which public assistance was provided to the child or children by the
department of human services.

(i)  Any alternative arrangement for direct payment
shall pertain only to the method of payment of child support.  The amount of
child support shall be determined according to the child support guidelines
pursuant to sections 576D-7 and 576E-15.

(j)  The alternative arrangement for direct
payment shall become effective upon approval and filing by the court.  For any
order approved pursuant to this section on or after October 1, 1998, each party
shall send a certified copy of the order to the state case registry established
under section 576D-6.

(k)  The agency shall not be required to
maintain records while an order obtained pursuant to this section is in effect,
except for any payments received and disbursed by the agency. [L 1986, c 332,
pt of §2; am L 1987, c 323, §1; am L 1988, c 34, §1; am L 1992, c 246, §2; am L
1996, c 178, §2; am L 1997, c 294, §3; am L 1999, c 300, §3; am L 2002, c 31,
§1 and c 72, §5; am L 2009, c 115, §2]

Case Notes

Where, after reviewing the applicable state and
federal rules, there was no authority for the child support enforcement
agency's (CSEA) voiding of the direct payment arrangement and directing
payments to itself simply because mother applied for CSEA services, family
court did not abuse its discretion by ordering CSEA to cease all collection and
enforcement efforts against father who did not fail to comply with the child
support order, but erred in finding that the CSEA had instituted "income
withholding".  118 H. 268 (App.), 188 P.3d 782.

  Where, pursuant to subsection (e), each party has
the right to void the direct payment arrangement at any time and apply for
collection and disbursement services from the child support enforcement agency
(CSEA), family court abused its discretion by ordering mother to direct any
future child support modification requests to the court and not to CSEA and by
ordering CSEA not to open a future case on father and institute collection and
enforcement efforts against father without the court's approval.  118 H. 268
(App.), 188 P.3d 782.