Prepared by CSS; February, 2021
Legal Authority
State law and policy authorizes Child Support Services (CSS) staff to enter into a settlement waiving all or some of the child support arrearages assigned to the state of Oklahoma. See Appendix A. Settlements must be approved by the State’s Attorney and memorialized in a court order. This is referred to as the ARC project.
Settlement Offers
The ARC project is a payment matching program. For every $1.00 an obligor pays, CSS will give credit for an additional $1.00. Once an obligor has paid the monthly current support obligation, CSS will match any voluntary payments (income assignment, money order, cashier’s checks, all kinds of webpay, kiosk and BancFirst, Worker’s Compensation [TTD or Lump Sum], Personal Injury and UIB) paid that month up to the amount of assigned arrears owed to the State of Oklahoma. Any payment types not specifically listed above should be considered excluded. Collections through state or federal tax offset, bank levy, lien, or other involuntary collection methods are not eligible for matching reductions and will not be considered in determining compliance. However, these excluded payments may be considered if they will pay off the case in full or there are other extenuating circumstances that may be approved by your Regional Administrator.
CSS does not compromise other state’s debts or private arrears or judgments.
CSS State’s Attorneys must approve all state debt compromise settlements.
Lump sum example: If an obligor paid $1,000 towards arrearages owed, CSS would waive the same amount of $1,000. Therefore, if an obligor paid $1,000 towards the arrearages owed, CSS would credit $1,000 and waive $1,000 for a total credit of $2,000 from the arrearages the obligor owes to the state of Oklahoma. If the case has both private and state assigned arrearages, per family first distribution, the payment will first apply to private arrearages. State arrears waived cannot exceed the amount of TANF unreimbursed assistance (URA). For specifics on finance updating, please see Appendix B, Reducing State Balances per ARC Order.
Payment agreement example: CSS may enter into agreements where an obligor could make, in addition to current support payments, payments on arrearages for a certain period of time, i.e. 6 months. If the obligor had paid as agreed, arrearages assigned to the state of Oklahoma would be reduced dollar for dollar by the amount of arrearages payments made.
Example: Obligor pays $100/month arrearage payment for 6 months = $600. Obligor’s state arrearages will be reduced by a total of $1,200. Cases subject to the ARC order with ongoing monthly payments should be monitored on a regular basis to adjust balances.
Criteria
CSS may make settlement offers in any case that meets the criteria as follows:
- State debt arrearages are owed; there can be arrearages owed to the custodial parent (CP) but those won’t be included in the settlement offer;
- 02 current support status with state-owed arrears owed and arrears/judgment status 06/08 cases are eligible.
In the situation of multiple cases, only cases where a payment allocates and applies to the ARC case will get the matching credit.
For offices that choose to do an ARC Project, CSS staff send the ARCLTR letter to obligors who owe state debt arrearages. The letter asks obligors to sign and return the ARC Application and Order.
CSS staff draft the proposed ARC Application ARCAPP and proposed ARC Order ARCORD. The documents are circulated to the obligor for agreement and signature and then presented to OAH. Included in the packet is the Acknowledgment of Receipt, Waiver of Service and Entry of Appearance (GN6).
Reducing State Balances per ARC Order
Cases subject to an ARC Order with ongoing monthly payments should be monitored on a regular basis to adjust balances based upon collections made. Cases subject to an ARC Order with lump sum payment should be adjusted timely upon entry of the order and receipt of the lump sum payment. For information on OSIS finance updates, see Appendix B.
ARC Payment and Order Tracking
The CSS office management should report their ARC payment agreements via the tracking system. The tracking will take place via the SharePoint site where data can be entered in real time and offices should make these updates as you are completing these 3 orders. See Child Support Services SharePoint – Arrears Reduction Campaign.
Questions
For questions, consult with your State’s Attorney, Managing Attorney or Regional Administrator. 4
Appendix A
Legal Authority
Law
A petition or cross-petition for a divorce, legal separation, or annulment must state whether or not the parties have minor children of the marriage. If there are minor children of the marriage, the court:
May modify or change any order whenever circumstances render the change proper either before or after final judgment in the action; provided, that the amount of the periodic child support payment shall not be modified retroactively or payment of all or a portion of the past due amount waived, except by mutual agreement of the obligor and obligee, or if the obligee has assigned child support rights to the Department of Human Services or other entity, by agreement of the Department or other entity. Unless the parties agree to the contrary, a completed child support computation form provided for in Section 120 of this title shall be required to be filed with the child support order.
Policy
OAC 340:25-5-140. Past support
(d) Settlement of past support.
(1) Settlements of past support may include:
(A) an NCP’s lump sum partial payment or a series of payments made toward the total amount of past support;
(B) an agreement for the NCP to pay a specified number of current child support payments in the future; and
(C) acceptance of in-kind goods or services in exchange for waiving a certain amount of past child support.
(2) Settlements of past support must be memorialized in a court order and the CP must sign the court order when the past support is owed to the CP.
(3) Per 43 O.S. § 112, CSS:
(A) acknowledges the rights of the CP and NCP to mutually agree to waive with approval of the court, all or a portion of the past child support due to the CP; or
(B) may negotiate the right to collect all or part of past support owed to Oklahoma.
INSTRUCTIONS TO STAFF 340:25-5-140
Settlement of past support. CSS staff includes the settlement terms, including any waivers of past support, in the court order. The district office CSS state’s attorneys must approve all settlements of past support.
(1) Past support owed to Oklahoma. When there is a settlement of past support owed to Oklahoma, the Unreimbursed Assistance balance is reduced by the amount of the assigned arrears being compromised. This provision does not apply in instances where the CP has multiple children on different child support cases.
(2) Past support owed to the CP. CSS staff drafts the court order with language that states the CP makes the waiver knowingly, voluntarily, and without coercion, and with the understanding that the CP may not make a claim for the waived child support amounts in the future.
(m) Waiver of interest. CSS acknowledges the rights of the custodial person (CP) and noncustodial parent (NCP) to mutually waive, with approval of the court, all or a portion of the interest due to the CP.
(1) CSS may negotiate the right to collect all or part of the interest owed to Oklahoma.
(2) Settlements of interest must be memorialized in a court order and may include:
(A) an NCP’s lump sum partial payment or a series of payments; or
(B) an agreement for the NCP to pay:
(i) a specified number of current child support payments in the future; or
(ii) non-cash support.
INSTRUCTIONS TO STAFF 340:25-5-140.1
Waiver of interest.
(1) CSS staff uses the legal settlement document on OSIS, Custodial Person’s Waiver of Interest in Conjunction with a Settlement.
(2) CSS staff includes the settlement terms of the waiver of interest in the court order. The district office CSS state’s attorney must approve all interest settlements owed to Oklahoma.
Appendix B
Reducing State Balances per State Debt Compromise Agreement
Once a court order is obtained to reduce state balances due to an NCP’s compliance with a State Debt Compromise agreement, a finance worker will adjust both the child support & TANF URA balances.
Note: If the CP has multiple FGNs, only the child support balances will be reduced. The TANF URA will not be reduced per Policy 340:25-5-140 ITS 5.
Possible Scenarios
The NCP has paid $600 over the last 6 months that retained to state owed past due balances and a court order states the state will waive $600 in state debt. The state balances on the case are $2,000 and the TANF URA is $16,525.
The NCP has paid $600 over the last 6 months that credited to private past due balances and a court order states the state will waive $600 in state debt. The state balances on the case are
$2,000 and the TANF URA is $16,525.
CFPA Entry for Arrears
If the state balances to reduce are arrears, the worker will enter a $600 non-cash payment on CFPA directing the payment to arrears by entering a “Y” in the NONCASH & ARREARS field and a “C,” “Z,” “E” or “F” (depending on the state arrears balance type) in the AR TP field.
Note: If interest is the state balance to be reduced, CFPA cannot be used. The worker will use INTADJ/ITU transactions.
CFPA Entry for Judgment
If the state balance to reduce is part of a judgment, the worker will enter a $600 non-cash payment on CFPA directing the payment to a judgment using the judgment sequence number (CFFBI). The worker will not enter anything in the JD TP field – this will be auto-populated based on the sequence number.
CFPL Display
Once entered, the payment will display on CFPL with a “Y” in the NCSH field. This tells the user that the payment was a non-cash payment or waiver. Entering state waiver agreement amounts on CFPA is better financial record keeping than just adjusting the balances via CFAR/J. Below is an example of a judgment non-cash entry on CFPL:
Reducing the TANF URA
Once the child support balances have been updated, the worker will reduce the TANF URA by the amount of state debt waived. In this example, the NCP paid $600 – so the URA will be reduced by $600.
Adjustments to the IV-E URA are not necessary.
This adjustment is completed using the URAADJR transaction (URAADJR (space) C/H# (space) Person ID).
From this screen, the worker will update:
- Benefit Type: C (for TANF).
- Increase: Y.
- Amount: the total amount of state money the state is waiving.
- Effective Date: 1st of the month of the court order waiving state debt.
- Notes: Indicate action taken.