View Bill Status
View Bill Text
View Amendment
View Engrossed Bill (Original Bill with Amendment(s) Incorporated)
View Statement of Purpose / Fiscal Impact
S1280aa..............................................by JUDICIARY AND RULES
FINANCIAL INSTITUTION DATA MATCH - Amends and adds to existing law relating
to child support enforcement to authorize the Department of Health and
Welfare to establish financial data match with financial institutions; to
govern financial data match for purposes of child or spousal support
enforcement; to define terms; to specify procedure, including grounds for
withholding assets, content, issuance, delivery and acceptance of an asset
withholding order; to specify duties of the financial institutions; to
specify the basis to contest an asset withholding order; and to regulate
the liability of financial institutions.
02/05 Senate intro - 1st rdg - to printing
02/06 Rpt prt - to Jud
02/17 Rpt out - to 14th Ord
03/02 Rpt out amen - to engros
03/03 Rpt engros - 1st rdg - to 2nd rdg as amen
03/04 2nd rdg - to 3rd rdg as amen
03/08 3rd rdg as amen - PASSED - 35-0-0
AYES -- Andreason, Bailey, Brandt, Bunderson, Burkett, Burtenshaw,
Calabretta, Cameron, Compton, Darrington, Davis, Gannon, Geddes,
Goedde, Hill, Ingram, Kennedy, Keough, Little, Lodge, Malepeai,
Marley, McKenzie, McWilliams, Noble, Noh, Pearce, Richardson,
Schroeder, Sorensen, Stegner, Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- None
Floor Sponsor - Bunderson
Title apvd - to House
03/09 House intro - 1st rdg - to Health/Wel
03/17 Rpt out - rec d/p - to 2nd rdg
03/18 2nd rdg - to 3rd rdg
03/19 3rd rdg - PASSED - 62-2-6
AYES -- Andersen, Barraclough, Bayer, Bedke, Bell, Block, Boe, Bolz,
Campbell, Cannon, Clark, Collins, Crow, Cuddy, Deal, Denney, Douglas,
Eberle, Ellsworth, Eskridge, Field(18), Field(23), Gagner, Garrett,
Harwood, Henbest, Jaquet, Jones, Kulczyk, Lake, Langford, Langhorst,
Martinez, McGeachin, McKague, Meyer, Miller, Mitchell, Moyle,
Naccarato, Nielsen, Pasley-Stuart, Raybould, Ridinger, Ring, Ringo,
Roberts, Robison, Rydalch, Sali, Sayler, Schaefer, Shepherd, Shirley,
Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Stevenson, Wills,
Mr. Speaker
NAYS -- Barrett, Wood
Absent and excused -- Bauer, Black, Bradford, Edmunson, Kellogg,
Trail
Floor Sponsor - Sali
Title apvd - to Senate
03/19 To enrol
03/20 Rpt enrol - Pres signed - Sp signed
03/22 To Governor
03/23 Governor signed
Session Law Chapter 213
Effective: 07/01/04
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
IN THE SENATE
SENATE BILL NO. 1280
BY JUDICIARY AND RULES COMMITTEE
1 AN ACT
2 RELATING TO CHILD SUPPORT ENFORCEMENT; AMENDING SECTION 56-203F, IDAHO CODE,
3 TO REDESIGNATE THE SECTION, TO AUTHORIZE THE DEPARTMENT OF HEALTH AND WEL-
4 FARE TO ESTABLISH A FINANCIAL DATA MATCH PROCESS WITH FINANCIAL INSTITU-
5 TIONS AND TO SPECIFY THE TERMS AND CONDITIONS OF THE PROCESS; AMENDING
6 TITLE 32, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 16, TITLE 32, IDAHO
7 CODE, TO GOVERN THE FINANCIAL DATA MATCH PROCESS FOR PURPOSES OF CHILD OR
8 SPOUSAL SUPPORT ENFORCEMENT, TO DEFINE TERMS, TO SPECIFY GROUNDS FOR WITH-
9 HOLDING ASSETS, TO SPECIFY CONTENT OF AN ASSET WITHHOLDING ORDER, TO GOV-
10 ERN ISSUANCE OF THE ASSET WITHHOLDING ORDER, TO GOVERN DELIVERY OF AN
11 ASSET WITHHOLDING ORDER AND ACCEPTANCE OF JURISDICTION, TO PROVIDE
12 REQUIREMENTS FOR NOTICE, TO SPECIFY DUTIES OF THE FINANCIAL INSTITUTIONS,
13 TO GOVERN CONDITIONS WHEN NO REQUEST FOR HEARING IS FILED, TO GOVERN CON-
14 DITIONS WHEN A REQUEST FOR HEARING TO CONTEST AN ASSET WITHHOLDING IS
15 FILED, TO SPECIFY THE BASIS TO CONTEST AN ASSET WITHHOLDING ORDER, TO GOV-
16 ERN THE ORDER FROM A HEARING, TO GOVERN CONDITIONS OF DEFAULT AND TO REGU-
17 LATE THE LIABILITY OF FINANCIAL INSTITUTIONS.
18 Be It Enacted by the Legislature of the State of Idaho:
19 SECTION 1. That Section 56-203F, Idaho Code, be, and the same is hereby
20 amended to read as follows:
21 56-203F32-1601. CHILD SUPPORT ENFORCEMENT -- AGREEMENTS WITH FINANCIAL
22 INSTITUTIONS DATA MATCH PROCESS. (1) The legislature finds that the federal
23 government has unreasonably mandated that the department must make certain
24 agreements with financial institutions in this state for the purposes of
25 improving the effectiveness of child support enforcement. The legislature also
26 finds that the current system for child support enforcement in this state has
27 historically performed well, and recent statutory changes have further
28 improved it, and that the mandated system will do little to improve such col-
29 lections. This section chapter is enacted to bring the state into compliance
30 with the requirements of P.L. 104-193, sec. 372, and title IV-D of the social
31 security act and to make the financial institution data match process an
32 effective enforcement tool for use in enforcing past due child support and
33 spousal support.
34 (2) The department is hereby authorized to establish a work group com-
35 prised of shall:
36 (a) Representatives of the types of financial institutions identified in
37 42 U.S.C. section 669a(d)(1);
38 (b) Representatives of "public utilities," "cooperatives," and
39 "municipalities" as defined in section 61-332A, Idaho Code, and "telephone
40 corporations" as defined in section 62-603, Idaho Code, and cable compa-
41 nies as defined in section 61-538, Idaho Code;
42 (c) Representatives of the department, which shall comprise no more than
43 one-third (1/3) of the total members of the work group.
2
1 (3) The work group shall:
2 (a) Identify those minimum statutory changes and terms of agreements
3 among the entities represented which are necessary to bring the state into
4 Establish and maintain a financial institution data match process with
5 financial institutions in compliance with 42 U.S.C. section 666(a)(17);
6 (b) Define the type of information in the hands of financial institutions
7 and utilities which is not otherwise available and pursuant to the agree-
8 ments with financial institutions which, if available to the department,
9 would actually and verifiably improve the effectiveness of child support
10 collection;
11 (c) As a term of each proposed agreement, lLimit authority to engage
12 match functions the matching process and access to all information
13 received to the smallest number of upper management specialized staff in
14 the department as is possible; (d) and dDevelop written protocol within
15 the department for the foregoing, delineating which functions would be
16 performed by which personnel and under what circumstances;
17 (ed) Limit engagement of contracted data match functions matching by the
18 department to those obligors who are in arrears in an amount equal to or
19 greater than the total support owing for at least ninety (90) days, or two
20 thousand dollars ($2,000), whichever is less;
21 (fe) Provide for annual statistical verification of the improvement to
22 child support enforcement in this state which results from use of the data
23 match functions contained in the proposed agreements process with the
24 financial institutions;
25 (gf) Design the data match system process identified herein in such a
26 manner that it will be the least intrusive, least expensive and most con-
27 fidential system process reasonably possible;
28 (hg) Develop a satisfactory contract term to protect the contracting
29 entities from legal liability for disclosure of information as authorized
30 by statute and to protect the public's right of action for wrongful dis-
31 closure.;
32 (4h) The department is authorized to eEnter into agreements with the
33 entities identified in subsection (2) of this section financial institu-
34 tions, and pay reasonable compensation, to such entities, not to exceed
35 actual costs incurred by such entity the financial institutions in devel-
36 oping the data match system process and conducting the data match.
37 (53) Terms of an agreement between the department and an entity may pro-
38 vide for a financial institution shall require the entity financial institu-
39 tion to provide the following information to the department: on the name and
40 address of each obligor who meets the criteria of delinquency as provided in
41 subsection (3)(e) of this section: name, address and place of employment, if
42 available. The information shall only be used for locate purposes identified
43 in the matching process, the account number(s) or other means of identifying
44 the asset, the amount and type of asset, the state in which the asset is
45 located, and other information necessary for compliance with federal require-
46 ments.
47 (4) Assets identified under this section may be withheld, attached or
48 garnished as provided by this chapter and otherwise as allowed by law.
49 (5) The assets which are subject to this section, regardless of location
50 in this or other states, are those on deposit with or held by a financial
51 institution.
52 (6) Assets in accounts with the obligor as sole owner or with the obligor
53 and spouse as the only co-owners, are subject to withholding up to the lesser
54 of one hundred percent (100%) of the asset or the amount of arrears owed by
55 the obligor, as set forth in the asset withholding order plus any fees pursu-
3
1 ant to section 32-1608(2), Idaho Code. Assets in other multiple party accounts
2 are subject to withholding up to the lesser of a proportionate amount of the
3 asset based upon the number of co-owners or the amount of arrears owed by the
4 obligor, as set forth in the asset withholding order, plus any fees pursuant
5 to section 32-1608(2), Idaho Code.
6 (6) Notwithstanding any other provisions of federal or state law, any
7 entity, or officer, agency or employee of the entity, acting in good faith,
8 shall be immune from any civil or criminal liability for disclosing any infor-
9 mation to a state child support enforcement agency pursuant to a contractual
10 obligation arising under an agreement contemplated in this section or if the
11 accumulation of such information is required in state or federal law, rule or
12 regulation. An entity shall not be required to give notice to an account
13 holder or customer of the entity concerning whom the entity has provided
14 information pursuant to this section. The state child support enforcement
15 agency which obtains information from any entity may disclose such information
16 only for the purpose of, and to the extent necessary to establish, modify or
17 enforce a child support obligation of a delinquent obligor.
18 SECTION 2. That Title 32, Idaho Code, be, and the same is hereby amended
19 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
20 ter 16, Title 32, Idaho Code, and to read as follows:
21 CHAPTER 16
22 FINANCIAL INSTITUTION DATA MATCH PROCESS
23 32-1602. DEFINITIONS. As used in this chapter:
24 (1) "Arrears" means child or spousal support that is due, owing and
25 unpaid pursuant to a support order.
26 (2) "Asset" means cash or cash value in or of a demand deposit account,
27 checking or negotiable withdrawal order account, savings account, share
28 account, share draft account, time deposit account or money market mutual fund
29 account; and/or negotiable instruments including stocks and bonds, annuities,
30 investment accounts or funds, and the cash value of insurance.
31 (3) "Asset withholding order" means an administrative order issued by the
32 department of health and welfare to a financial institution requiring the
33 freezing and surrender of an asset in which an obligor has an interest.
34 (4) "Child support" means the obligation, pursuant to a support order, to
35 provide for the needs of a child, including food, clothing, shelter, educa-
36 tion, day care and health care. "Child support" also includes reimbursement to
37 any agency for medical assistance, assistance paid to families with children,
38 and interest owed on such support.
39 (5) "Co-owner" means a person having withdrawal rights on a multiple
40 party account.
41 (6) "Department" means the Idaho department of health and welfare.
42 (7) "Financial institution" means a bank, credit union or other deposi-
43 tory institution, benefit association, insurance company, safe deposit com-
44 pany, money market mutual fund and other entities defined in 42 U.S.C.
45 669a(d)(1).
46 (8) "Obligor" means any person obligated by support order to pay child or
47 spousal support.
48 (9) "Owner" means a person or entity who, by the terms of the account,
49 has a present right, subject to a proper request in compliance with terms of
50 the account, to payment from the account.
51 (10) "Spousal support" means the obligation, pursuant to a support order,
52 to provide for a spouse or a former spouse.
4
1 (11) "Support order" means a judgment, decree, or administrative order
2 from any state, directing one (1) or more individuals to pay child support or
3 spousal support.
4 32-1603. WITHHOLDING OF ASSETS -- GROUNDS AND ISSUANCE. When the depart-
5 ment receives information from a data matching process that an obligor is an
6 owner or co-owner of an asset held by a financial institution, the department
7 may issue an asset withholding order. Any asset which is subject to a previ-
8 ously perfected security interest or right of set-off from the financial
9 institution is subject to withholding only as to the unencumbered portion of
10 the asset.
11 32-1604. CONTENT OF ASSET WITHHOLDING ORDER. An asset withholding order
12 shall contain:
13 (1) The name of the obligor and any known co-owner or multiple party
14 account holder;
15 (2) The address of the obligor as listed in the department's records;
16 (3) The account number or other means of identifying the asset subject to
17 the withholding order;
18 (4) The amount of arrears owed by the obligor;
19 (5) Other information as determined by the department.
20 32-1605. RECEIPT AND ACCEPTANCE OF ASSET WITHHOLDING ORDER. (1) When an
21 asset withholding order is received by a financial institution pursuant to
22 this chapter, the financial institution shall immediately freeze the asset
23 subject to the withholding order up to the maximum amount as set forth in sec-
24 tion 32-1601(6), Idaho Code. Financial institutions shall accept the asset
25 withholding order at any office of the financial institution located in this
26 state, or at a particular office in this state or another state designated by
27 the financial institution for the service of attachment, execution and gar-
28 nishment papers pursuant to section 8-507(b), Idaho Code.
29 If the financial institution has designated a particular office for ser-
30 vice of attachment, execution and garnishment papers pursuant to section
31 8-507(b), Idaho Code, and the asset withholding order is received by another
32 office of the financial institution, it is within the discretion of the finan-
33 cial institution to accept the order and promptly forward the order to the
34 designated office; not accept the order and promptly forward the order to the
35 designated office; or promptly return it to the department. If a financial
36 institution has chosen to accept the order at a nondesignated office, the
37 financial institution's duties pursuant to section 32-1608(1), Idaho Code,
38 shall be effective upon acceptance at that office, and the time periods for
39 the financial institution's duties pursuant to subsections (2) and (3) of sec-
40 tion 32-1608, Idaho Code, shall begin to run upon receipt of the order at the
41 designated office.
42 (2) Unless otherwise notified by the department pursuant to this chapter,
43 the financial institution shall release the asset to the obligor on the
44 seventy-sixth day after the financial institution receives the asset withhold-
45 ing order.
46 (3) The department shall provide the financial institution with copies of
47 the order and notice required by section 32-1607, Idaho Code, to forward to
48 the obligor and any co-owner.
49 32-1606. DELIVERY OF AN ASSET WITHHOLDING ORDER AND ACCEPTANCE OF JURIS-
50 DICTION. (1) A financial institution shall accept an asset withholding order
51 by any form of U.S. mail, commercial mail, delivery service, by facsimile or
5
1 other electronic form of correspondence. If the asset withholding order is
2 delivered electronically, the effective date shall be the date the electronic
3 copy is received. An additional copy of the order shall also be sent to the
4 financial institution by regular mail.
5 (2) If the financial institution elects to designate an out-of-state
6 office to accept or process an asset withholding order, such election shall
7 act as a waiver of any claim of defect in jurisdiction.
8 32-1607. NOTICE. Upon the issuance of an asset withholding order to the
9 financial institution, the department shall, within one (1) business day, send
10 to the obligor by certified mail, at the last known address in the
11 department's records, a copy of the asset withholding order and a notice con-
12 taining the following:
13 (1) The obligor's and/or the co-owner's right to a hearing;
14 (2) The request for a hearing must be in writing and received by the
15 department within fourteen (14) days after the date of mailing the notice;
16 (3) That the asset subject to the withholding order will be applied to
17 the arrears unless a timely request for hearing is made; and
18 (4) That the asset will be released by the department if the obligor pays
19 the arrears and the current support obligation in full.
20 32-1608. DUTIES OF THE FINANCIAL INSTITUTION. (1) Upon receipt or accep-
21 tance of an asset withholding order issued by the department pursuant to this
22 chapter, the financial institution shall immediately freeze the asset subject
23 to the withholding order up to the maximum amount as set forth in section
24 32-1601(6), Idaho Code. The financial institution shall honor the terms of the
25 account of the said asset, except when the terms conflict with compliance with
26 this chapter. The financial institution shall freeze, release or surrender the
27 asset as provided in this chapter.
28 (2) The financial institution shall be required to mail, within two (2)
29 business days, copies of the asset withholding order and notice, provided by
30 the department pursuant to section 32-1605(3), Idaho Code, to the obligor and
31 to each co-owner, based on the records of the financial institution. A fee not
32 to exceed five dollars ($5.00) per mailing may be assessed by the financial
33 institution for sending the required copies of the documents. The fee can be
34 withheld in addition to the amount ordered withheld. If funds are inadequate
35 to cover the amount of the asset withholding order and the fees, the fees may
36 be withheld from the asset before the remaining balance is applied to the
37 withholding order.
38 (3) The financial institution shall complete and return to the department
39 any asset verification form provided by the department within fourteen (14)
40 days from the date of receipt of the asset verification form.
41 (4) Upon notification by the department that the obligor has not filed a
42 request for hearing within the allowed time, the financial institution will
43 release the asset promptly to the department by sending the funds to the
44 department.
45 32-1609. NO REQUEST FOR HEARING. If the obligor or a co-owner has not
46 filed a request for hearing within fourteen (14) days after the date the
47 department mailed the notice to the obligor, the department shall notify the
48 financial institution and the financial institution shall promptly surrender
49 the amount of the asset that has been frozen to the department. The department
50 shall apply this amount to the obligor's arrears.
51 32-1610. HEARING TO CONTEST ASSET WITHHOLDING. (1) Within five (5) busi-
6
1 ness days of receiving a timely request for hearing, the department will
2 schedule the administrative hearing date and notify the obligor and any co-
3 owners by mail. Upon receiving the request for hearing, the department shall
4 notify the financial institution that it must continue to hold the asset until
5 an order is issued and the department provides instructions for the disposi-
6 tion of the asset pursuant to section 32-1612, Idaho Code.
7 (2) The department will hold an administrative hearing within thirty (30)
8 days from the day the department receives the request for hearing.
9 32-1611. BASIS TO CONTEST THE ASSET WITHHOLDING ORDER. The obligor who
10 owes the support or any co-owner of the asset that is subject to the asset
11 withholding order may contest the order to withhold. Contests are limited to
12 the following issues:
13 (1) The amount of the arrears;
14 (2) The validity of the order; or
15 (3) The extent of the obligor's interest in the asset.
16 Issues that have been previously adjudicated may not be contested.
17 32-1612. ORDER FROM HEARING. (1) The department shall issue an order
18 based upon the hearing that rejects the contest or supports the contest in
19 whole or part. The parties may file an appeal with the district court within
20 twenty-eight (28) days, notwithstanding the provisions of section 67-5243,
21 Idaho Code.
22 (2) The department shall notify the financial institution in writing,
23 within two (2) business days after the receipt of the order, as to the outcome
24 of the hearing, and provide instructions to the financial institution as to
25 the disposition of the asset that has been frozen.
26 32-1613. DEFAULT. (1) The allegations of the asset withholding order
27 shall be deemed admitted and the department shall issue an order upholding the
28 asset withholding order if the obligor or co-owner fails to appear at the
29 hearing without good cause. The default and issuance of any subsequent order
30 shall be entered pursuant to the department's rules governing contested case
31 proceedings.
32 (2) The department shall notify the financial institution in writing,
33 within two (2) business days after the receipt of the default order, and pro-
34 vide instructions to the financial institution as to the disposition of the
35 asset that has been frozen.
36 32-1614. LIABILITY OF FINANCIAL INSTITUTION. Notwithstanding any other
37 provisions of federal or state law, any financial institution, or officer,
38 agent or employee of the financial institution, acting in good faith, shall be
39 immune from all civil and criminal liability for withholding funds, freezing
40 assets, turning over assets or otherwise complying or attempting to comply
41 with the provisions of this chapter or for disclosing any information to a
42 state child support enforcement agency pursuant to this chapter. A financial
43 institution shall not be required to give notice to any owner or co-owner of
44 the financial institution concerning whom the financial institution has pro-
45 vided information pursuant to the data match process. The state child support
46 enforcement agency which obtains information from any financial institution
47 may disclose such information only for the purpose of, and to the extent nec-
48 essary to establish, modify or enforce a support obligation of an obligor.
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
Moved by Bunderson
Seconded by Davis
IN THE SENATE
SENATE AMENDMENT TO S.B. NO. 1280
1 AMENDMENTS TO SECTION 2
2 On page 5 of the printed bill, in line 17, delete "and"; in line 19,
3 delete "." and insert: "; and"; following line 19, insert:
4 "(5) The grounds to contest the asset withholding order:
5 (a) The amount of arrears;
6 (b) The validity of the order;
7 (c) The extent of the obligor's interest in the asset; and
8 (d) The amount which qualifies as a homestead exemption pursuant to sec-
9 tion 55-1008, Idaho Code.";
10 on page 6, in line 14, delete "or"; in line 15, delete "." and insert: "; or";
11 and following line 15, insert:
12 "(4) The amount which qualifies as a homestead exemption pursuant to sec-
13 tion 55-1008, Idaho Code.".
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
IN THE SENATE
SENATE BILL NO. 1280, As Amended
BY JUDICIARY AND RULES COMMITTEE
1 AN ACT
2 RELATING TO CHILD SUPPORT ENFORCEMENT; AMENDING SECTION 56-203F, IDAHO CODE,
3 TO REDESIGNATE THE SECTION, TO AUTHORIZE THE DEPARTMENT OF HEALTH AND WEL-
4 FARE TO ESTABLISH A FINANCIAL DATA MATCH PROCESS WITH FINANCIAL INSTITU-
5 TIONS AND TO SPECIFY THE TERMS AND CONDITIONS OF THE PROCESS; AMENDING
6 TITLE 32, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 16, TITLE 32, IDAHO
7 CODE, TO GOVERN THE FINANCIAL DATA MATCH PROCESS FOR PURPOSES OF CHILD OR
8 SPOUSAL SUPPORT ENFORCEMENT, TO DEFINE TERMS, TO SPECIFY GROUNDS FOR WITH-
9 HOLDING ASSETS, TO SPECIFY CONTENT OF AN ASSET WITHHOLDING ORDER, TO GOV-
10 ERN ISSUANCE OF THE ASSET WITHHOLDING ORDER, TO GOVERN DELIVERY OF AN
11 ASSET WITHHOLDING ORDER AND ACCEPTANCE OF JURISDICTION, TO PROVIDE
12 REQUIREMENTS FOR NOTICE, TO SPECIFY DUTIES OF THE FINANCIAL INSTITUTIONS,
13 TO GOVERN CONDITIONS WHEN NO REQUEST FOR HEARING IS FILED, TO GOVERN CON-
14 DITIONS WHEN A REQUEST FOR HEARING TO CONTEST AN ASSET WITHHOLDING IS
15 FILED, TO SPECIFY THE BASIS TO CONTEST AN ASSET WITHHOLDING ORDER, TO GOV-
16 ERN THE ORDER FROM A HEARING, TO GOVERN CONDITIONS OF DEFAULT AND TO REGU-
17 LATE THE LIABILITY OF FINANCIAL INSTITUTIONS.
18 Be It Enacted by the Legislature of the State of Idaho:
19 SECTION 1. That Section 56-203F, Idaho Code, be, and the same is hereby
20 amended to read as follows:
21 56-203F32-1601. CHILD SUPPORT ENFORCEMENT -- AGREEMENTS WITH FINANCIAL
22 INSTITUTIONS DATA MATCH PROCESS. (1) The legislature finds that the federal
23 government has unreasonably mandated that the department must make certain
24 agreements with financial institutions in this state for the purposes of
25 improving the effectiveness of child support enforcement. The legislature also
26 finds that the current system for child support enforcement in this state has
27 historically performed well, and recent statutory changes have further
28 improved it, and that the mandated system will do little to improve such col-
29 lections. This section chapter is enacted to bring the state into compliance
30 with the requirements of P.L. 104-193, sec. 372, and title IV-D of the social
31 security act and to make the financial institution data match process an
32 effective enforcement tool for use in enforcing past due child support and
33 spousal support.
34 (2) The department is hereby authorized to establish a work group com-
35 prised of shall:
36 (a) Representatives of the types of financial institutions identified in
37 42 U.S.C. section 669a(d)(1);
38 (b) Representatives of "public utilities," "cooperatives," and
39 "municipalities" as defined in section 61-332A, Idaho Code, and "telephone
40 corporations" as defined in section 62-603, Idaho Code, and cable compa-
41 nies as defined in section 61-538, Idaho Code;
42 (c) Representatives of the department, which shall comprise no more than
43 one-third (1/3) of the total members of the work group.
2
1 (3) The work group shall:
2 (a) Identify those minimum statutory changes and terms of agreements
3 among the entities represented which are necessary to bring the state into
4 Establish and maintain a financial institution data match process with
5 financial institutions in compliance with 42 U.S.C. section 666(a)(17);
6 (b) Define the type of information in the hands of financial institutions
7 and utilities which is not otherwise available and pursuant to the agree-
8 ments with financial institutions which, if available to the department,
9 would actually and verifiably improve the effectiveness of child support
10 collection;
11 (c) As a term of each proposed agreement, lLimit authority to engage
12 match functions the matching process and access to all information
13 received to the smallest number of upper management specialized staff in
14 the department as is possible; (d) and dDevelop written protocol within
15 the department for the foregoing, delineating which functions would be
16 performed by which personnel and under what circumstances;
17 (ed) Limit engagement of contracted data match functions matching by the
18 department to those obligors who are in arrears in an amount equal to or
19 greater than the total support owing for at least ninety (90) days, or two
20 thousand dollars ($2,000), whichever is less;
21 (fe) Provide for annual statistical verification of the improvement to
22 child support enforcement in this state which results from use of the data
23 match functions contained in the proposed agreements process with the
24 financial institutions;
25 (gf) Design the data match system process identified herein in such a
26 manner that it will be the least intrusive, least expensive and most con-
27 fidential system process reasonably possible;
28 (hg) Develop a satisfactory contract term to protect the contracting
29 entities from legal liability for disclosure of information as authorized
30 by statute and to protect the public's right of action for wrongful dis-
31 closure.;
32 (4h) The department is authorized to eEnter into agreements with the
33 entities identified in subsection (2) of this section financial institu-
34 tions, and pay reasonable compensation, to such entities, not to exceed
35 actual costs incurred by such entity the financial institutions in devel-
36 oping the data match system process and conducting the data match.
37 (53) Terms of an agreement between the department and an entity may pro-
38 vide for a financial institution shall require the entity financial institu-
39 tion to provide the following information to the department: on the name and
40 address of each obligor who meets the criteria of delinquency as provided in
41 subsection (3)(e) of this section: name, address and place of employment, if
42 available. The information shall only be used for locate purposes identified
43 in the matching process, the account number(s) or other means of identifying
44 the asset, the amount and type of asset, the state in which the asset is
45 located, and other information necessary for compliance with federal require-
46 ments.
47 (4) Assets identified under this section may be withheld, attached or
48 garnished as provided by this chapter and otherwise as allowed by law.
49 (5) The assets which are subject to this section, regardless of location
50 in this or other states, are those on deposit with or held by a financial
51 institution.
52 (6) Assets in accounts with the obligor as sole owner or with the obligor
53 and spouse as the only co-owners, are subject to withholding up to the lesser
54 of one hundred percent (100%) of the asset or the amount of arrears owed by
55 the obligor, as set forth in the asset withholding order plus any fees pursu-
3
1 ant to section 32-1608(2), Idaho Code. Assets in other multiple party accounts
2 are subject to withholding up to the lesser of a proportionate amount of the
3 asset based upon the number of co-owners or the amount of arrears owed by the
4 obligor, as set forth in the asset withholding order, plus any fees pursuant
5 to section 32-1608(2), Idaho Code.
6 (6) Notwithstanding any other provisions of federal or state law, any
7 entity, or officer, agency or employee of the entity, acting in good faith,
8 shall be immune from any civil or criminal liability for disclosing any infor-
9 mation to a state child support enforcement agency pursuant to a contractual
10 obligation arising under an agreement contemplated in this section or if the
11 accumulation of such information is required in state or federal law, rule or
12 regulation. An entity shall not be required to give notice to an account
13 holder or customer of the entity concerning whom the entity has provided
14 information pursuant to this section. The state child support enforcement
15 agency which obtains information from any entity may disclose such information
16 only for the purpose of, and to the extent necessary to establish, modify or
17 enforce a child support obligation of a delinquent obligor.
18 SECTION 2. That Title 32, Idaho Code, be, and the same is hereby amended
19 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
20 ter 16, Title 32, Idaho Code, and to read as follows:
21 CHAPTER 16
22 FINANCIAL INSTITUTION DATA MATCH PROCESS
23 32-1602. DEFINITIONS. As used in this chapter:
24 (1) "Arrears" means child or spousal support that is due, owing and
25 unpaid pursuant to a support order.
26 (2) "Asset" means cash or cash value in or of a demand deposit account,
27 checking or negotiable withdrawal order account, savings account, share
28 account, share draft account, time deposit account or money market mutual fund
29 account; and/or negotiable instruments including stocks and bonds, annuities,
30 investment accounts or funds, and the cash value of insurance.
31 (3) "Asset withholding order" means an administrative order issued by the
32 department of health and welfare to a financial institution requiring the
33 freezing and surrender of an asset in which an obligor has an interest.
34 (4) "Child support" means the obligation, pursuant to a support order, to
35 provide for the needs of a child, including food, clothing, shelter, educa-
36 tion, day care and health care. "Child support" also includes reimbursement to
37 any agency for medical assistance, assistance paid to families with children,
38 and interest owed on such support.
39 (5) "Co-owner" means a person having withdrawal rights on a multiple
40 party account.
41 (6) "Department" means the Idaho department of health and welfare.
42 (7) "Financial institution" means a bank, credit union or other deposi-
43 tory institution, benefit association, insurance company, safe deposit com-
44 pany, money market mutual fund and other entities defined in 42 U.S.C.
45 669a(d)(1).
46 (8) "Obligor" means any person obligated by support order to pay child or
47 spousal support.
48 (9) "Owner" means a person or entity who, by the terms of the account,
49 has a present right, subject to a proper request in compliance with terms of
50 the account, to payment from the account.
51 (10) "Spousal support" means the obligation, pursuant to a support order,
52 to provide for a spouse or a former spouse.
4
1 (11) "Support order" means a judgment, decree, or administrative order
2 from any state, directing one (1) or more individuals to pay child support or
3 spousal support.
4 32-1603. WITHHOLDING OF ASSETS -- GROUNDS AND ISSUANCE. When the depart-
5 ment receives information from a data matching process that an obligor is an
6 owner or co-owner of an asset held by a financial institution, the department
7 may issue an asset withholding order. Any asset which is subject to a previ-
8 ously perfected security interest or right of set-off from the financial
9 institution is subject to withholding only as to the unencumbered portion of
10 the asset.
11 32-1604. CONTENT OF ASSET WITHHOLDING ORDER. An asset withholding order
12 shall contain:
13 (1) The name of the obligor and any known co-owner or multiple party
14 account holder;
15 (2) The address of the obligor as listed in the department's records;
16 (3) The account number or other means of identifying the asset subject to
17 the withholding order;
18 (4) The amount of arrears owed by the obligor;
19 (5) Other information as determined by the department.
20 32-1605. RECEIPT AND ACCEPTANCE OF ASSET WITHHOLDING ORDER. (1) When an
21 asset withholding order is received by a financial institution pursuant to
22 this chapter, the financial institution shall immediately freeze the asset
23 subject to the withholding order up to the maximum amount as set forth in sec-
24 tion 32-1601(6), Idaho Code. Financial institutions shall accept the asset
25 withholding order at any office of the financial institution located in this
26 state, or at a particular office in this state or another state designated by
27 the financial institution for the service of attachment, execution and gar-
28 nishment papers pursuant to section 8-507(b), Idaho Code.
29 If the financial institution has designated a particular office for ser-
30 vice of attachment, execution and garnishment papers pursuant to section
31 8-507(b), Idaho Code, and the asset withholding order is received by another
32 office of the financial institution, it is within the discretion of the finan-
33 cial institution to accept the order and promptly forward the order to the
34 designated office; not accept the order and promptly forward the order to the
35 designated office; or promptly return it to the department. If a financial
36 institution has chosen to accept the order at a nondesignated office, the
37 financial institution's duties pursuant to section 32-1608(1), Idaho Code,
38 shall be effective upon acceptance at that office, and the time periods for
39 the financial institution's duties pursuant to subsections (2) and (3) of sec-
40 tion 32-1608, Idaho Code, shall begin to run upon receipt of the order at the
41 designated office.
42 (2) Unless otherwise notified by the department pursuant to this chapter,
43 the financial institution shall release the asset to the obligor on the
44 seventy-sixth day after the financial institution receives the asset withhold-
45 ing order.
46 (3) The department shall provide the financial institution with copies of
47 the order and notice required by section 32-1607, Idaho Code, to forward to
48 the obligor and any co-owner.
49 32-1606. DELIVERY OF AN ASSET WITHHOLDING ORDER AND ACCEPTANCE OF JURIS-
50 DICTION. (1) A financial institution shall accept an asset withholding order
51 by any form of U.S. mail, commercial mail, delivery service, by facsimile or
5
1 other electronic form of correspondence. If the asset withholding order is
2 delivered electronically, the effective date shall be the date the electronic
3 copy is received. An additional copy of the order shall also be sent to the
4 financial institution by regular mail.
5 (2) If the financial institution elects to designate an out-of-state
6 office to accept or process an asset withholding order, such election shall
7 act as a waiver of any claim of defect in jurisdiction.
8 32-1607. NOTICE. Upon the issuance of an asset withholding order to the
9 financial institution, the department shall, within one (1) business day, send
10 to the obligor by certified mail, at the last known address in the
11 department's records, a copy of the asset withholding order and a notice con-
12 taining the following:
13 (1) The obligor's and/or the co-owner's right to a hearing;
14 (2) The request for a hearing must be in writing and received by the
15 department within fourteen (14) days after the date of mailing the notice;
16 (3) That the asset subject to the withholding order will be applied to
17 the arrears unless a timely request for hearing is made;
18 (4) That the asset will be released by the department if the obligor pays
19 the arrears and the current support obligation in full; and
20 (5) The grounds to contest the asset withholding order:
21 (a) The amount of arrears;
22 (b) The validity of the order;
23 (c) The extent of the obligor's interest in the asset; and
24 (d) The amount which qualifies as a homestead exemption pursuant to sec-
25 tion 55-1008, Idaho Code.
26 32-1608. DUTIES OF THE FINANCIAL INSTITUTION. (1) Upon receipt or accep-
27 tance of an asset withholding order issued by the department pursuant to this
28 chapter, the financial institution shall immediately freeze the asset subject
29 to the withholding order up to the maximum amount as set forth in section
30 32-1601(6), Idaho Code. The financial institution shall honor the terms of the
31 account of the said asset, except when the terms conflict with compliance with
32 this chapter. The financial institution shall freeze, release or surrender the
33 asset as provided in this chapter.
34 (2) The financial institution shall be required to mail, within two (2)
35 business days, copies of the asset withholding order and notice, provided by
36 the department pursuant to section 32-1605(3), Idaho Code, to the obligor and
37 to each co-owner, based on the records of the financial institution. A fee not
38 to exceed five dollars ($5.00) per mailing may be assessed by the financial
39 institution for sending the required copies of the documents. The fee can be
40 withheld in addition to the amount ordered withheld. If funds are inadequate
41 to cover the amount of the asset withholding order and the fees, the fees may
42 be withheld from the asset before the remaining balance is applied to the
43 withholding order.
44 (3) The financial institution shall complete and return to the department
45 any asset verification form provided by the department within fourteen (14)
46 days from the date of receipt of the asset verification form.
47 (4) Upon notification by the department that the obligor has not filed a
48 request for hearing within the allowed time, the financial institution will
49 release the asset promptly to the department by sending the funds to the
50 department.
51 32-1609. NO REQUEST FOR HEARING. If the obligor or a co-owner has not
52 filed a request for hearing within fourteen (14) days after the date the
6
1 department mailed the notice to the obligor, the department shall notify the
2 financial institution and the financial institution shall promptly surrender
3 the amount of the asset that has been frozen to the department. The department
4 shall apply this amount to the obligor's arrears.
5 32-1610. HEARING TO CONTEST ASSET WITHHOLDING. (1) Within five (5) busi-
6 ness days of receiving a timely request for hearing, the department will
7 schedule the administrative hearing date and notify the obligor and any co-
8 owners by mail. Upon receiving the request for hearing, the department shall
9 notify the financial institution that it must continue to hold the asset until
10 an order is issued and the department provides instructions for the disposi-
11 tion of the asset pursuant to section 32-1612, Idaho Code.
12 (2) The department will hold an administrative hearing within thirty (30)
13 days from the day the department receives the request for hearing.
14 32-1611. BASIS TO CONTEST THE ASSET WITHHOLDING ORDER. The obligor who
15 owes the support or any co-owner of the asset that is subject to the asset
16 withholding order may contest the order to withhold. Contests are limited to
17 the following issues:
18 (1) The amount of the arrears;
19 (2) The validity of the order;
20 (3) The extent of the obligor's interest in the asset; or
21 (4) The amount which qualifies as a homestead exemption pursuant to sec-
22 tion 55-1008, Idaho Code.
23 Issues that have been previously adjudicated may not be contested.
24 32-1612. ORDER FROM HEARING. (1) The department shall issue an order
25 based upon the hearing that rejects the contest or supports the contest in
26 whole or part. The parties may file an appeal with the district court within
27 twenty-eight (28) days, notwithstanding the provisions of section 67-5243,
28 Idaho Code.
29 (2) The department shall notify the financial institution in writing,
30 within two (2) business days after the receipt of the order, as to the outcome
31 of the hearing, and provide instructions to the financial institution as to
32 the disposition of the asset that has been frozen.
33 32-1613. DEFAULT. (1) The allegations of the asset withholding order
34 shall be deemed admitted and the department shall issue an order upholding the
35 asset withholding order if the obligor or co-owner fails to appear at the
36 hearing without good cause. The default and issuance of any subsequent order
37 shall be entered pursuant to the department's rules governing contested case
38 proceedings.
39 (2) The department shall notify the financial institution in writing,
40 within two (2) business days after the receipt of the default order, and pro-
41 vide instructions to the financial institution as to the disposition of the
42 asset that has been frozen.
43 32-1614. LIABILITY OF FINANCIAL INSTITUTION. Notwithstanding any other
44 provisions of federal or state law, any financial institution, or officer,
45 agent or employee of the financial institution, acting in good faith, shall be
46 immune from all civil and criminal liability for withholding funds, freezing
47 assets, turning over assets or otherwise complying or attempting to comply
48 with the provisions of this chapter or for disclosing any information to a
49 state child support enforcement agency pursuant to this chapter. A financial
50 institution shall not be required to give notice to any owner or co-owner of
7
1 the financial institution concerning whom the financial institution has pro-
2 vided information pursuant to the data match process. The state child support
3 enforcement agency which obtains information from any financial institution
4 may disclose such information only for the purpose of, and to the extent nec-
5 essary to establish, modify or enforce a support obligation of an obligor.
STATEMENT OF PURPOSE
RS 13578C1
Financial Institution Data Match (FIDM) is a requirement under the
Personal Responsibility and Work Opportunity Reconciliation Act
(PRWORA). This federal mandate requires states to obtain financial
account information on parents who are delinquent in paying child
support, and to attach the financial accounts to pay child support
debts. The Bureau of Child Support Operations has developed the
data match, but has been unsuccessful in using it as an enforcement
tool due to the costs and restrictions involved in the garnishment
process. Idaho's garnishment laws are restrictive, as they apply
only to accounts that are located within the State. In addition,
garnishment papers must be filed with the Clerk of the Court and
served by a county Sheriff, taking several weeks for processing.
This proposal revises existing child support statutes to include
the attachment of financial assets by using the well established
administrative process for income withholding. The administrative
process currently provides due process for the obligated parent and
will continue to do so. The professional community accepts the use
of administrative process and can be used across state lines
without the assistance of the Clerk of Court or Sheriff. Expanding
the law to include administrative attachment of financial assets,
will be more efficient and more cost effective. During the last
year, only four garnishments have been done due to the restrictive
process.
FISCAL IMPACT
Effective Date: July 1, 2004
Cost estimates: 1st year cost - $6,400.00 form development
3-5 year annual impact $19,800.00 legal fees.
CONTACT
Name: Kandee Yearsley
Agency: Department of Health and Welfare
Phone: 334-0620
Statement of Purpose/Fiscal Impact S 1280