Child Support Enforcement:

Opportunity to Reduce Federal and State Costs

T-HEHS-95-181: Published: Jun 13, 1995. Publicly Released: Jun 13, 1995.

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GAO discussed opportunities to reduce the costs for providing child support enforcement services to non-Aid to Families with Dependent Children (AFDC) recipients, focusing on: (1) the growth in non-AFDC caseloads and related administrative service costs; (2) the income characteristics of non-AFDC clients; (3) alternatives for increasing non-AFDC cost recovery; and (4) an alternative fee structure based on child support collections. GAO noted that: (1) non-AFDC caseloads have risen sharply and administrative costs have risen over 600 percent to over $1.1 billion from 1984 to 1994; (2) many non-AFDC clients may not be within the low-income population requesting child support services; (3) states have charged these clients minimal application and optional service fees and are doing little to help recover the federal government's 66-percent share of program costs; (4) although non-AFDC service costs increased significantly between 1984 and 1994, recoveries of these costs only increased from 2 percent to 3 percent; (5) the service cost for non-AFDC cases averaged $136 in fiscal year 1994, while the average fee collected was $4; (6) private child support enforcement agencies may charge an application fee and a percentage fee of about 25 to 33 percent of the support collected; and (7) charging a minimum service fee for all child support collections and eliminating the mandatory non-AFDC child support application fee and optional tax offset fees would provide an appropriate alternative to finance child support services.

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