NJ - Deadbeat parents must pay interest

http://www.nj.com/news/ledger/jersey...960.xml&coll=1

Deadbeat parents must pay interest
State had balked at order to collect
Friday, September 01, 2006
BY MARGARET McHUGH
Star-Ledger Staff

Probation departments throughout the state have been told to start
collecting interest on overdue child support from deadbeat parents.
The recent order followed an appellate court's refusal to give the state
until January 2009 to re-engineer its computer system to make the interest
calculations.

Judge Philip Carchman, acting director of the New Jersey courts, issued the
directive last Friday, establishing a temporary procedure for collecting
against deadbeat parents' assets.

More than $2.4 billion in child support is overdue in New Jersey, not
counting interest.

Carchman issued the directive "to quickly comply with the court order," said
Tamara Kendig, a spokeswoman for the Administrative Office of the Courts.
"We don't know yet what the impact will be."

In March, an appellate panel ruled the state was obligated to collect
interest on overdue child support. The state Department of Human Services
appealed, claiming it could not comply.

Human Services, which is in charge of the child support system but has
probation handle collections, said the state could lose more than $130
million a year in federal funding if it wasn't first allowed to update its
computer system.

Appellate Judge Donald Collester Jr. rejected the state's request to
postpone implementation of the ruling on July 28.

"The appellate court said basically, 'No, No, No. Do what we told you to
do,'" said attorney Robert Radol, who won the right for a Teaneck mother
owed $7,000 in overdue child support to collect $15,500 in interest.

Child advocates say parents who don't pay child support on time are in
essence taking interest-free loans from their children, and that charging
interest would improve collection rates.

In its appeal, the state claimed it would have to hire 29 extra employees in
the probation division to calculate interest. However, Kendig said there are
no plans to do so.

The court ruling only requires probation offices to charge interest when the
entire amount owed is to be paid off, either when the delinquent parent
comes forward to clear the debt or when the agency finds an asset that can
clear it.

Probation does not have to calculate interest as arrears accrue, but if the
parent who is owed the money calculates the interest, probation must add it
onto the amount owed, the decision said.

Carchman's order says that if counsel represents either or both parents,
then it will be up to them to calculate the interest. If neither has a
lawyer, then probation must do the math if asked by the parent owed the
money.

Professor Claudette St. Romain of Seton Hall University Law School's Center
for Social Justice called the directive "a positive step and a real
commitment by the AOC to work to comply with the law." However, she said she
found shortcomings.

"I'm concerned it doesn't go far enough," St. Romain said.

The court ruling requires probation, not the lawyers for the parents, to
calculate interest when collecting the entire amount of overdue child
support. The directive "transfers the responsibility to attorneys," she
said.

Kendig, however, said that is standard practice in the collection of all
civil judgments.

Parsippany accountant Richard L. Lipton, who created a computer program to
calculate interest due Radol's client, said the state, by failing to collect
interest, is losing out on millions in tax dollars. He noted interest on
overdue child support is taxable income in New Jersey.

Lipton said he suggested the state contract with his firm to do the
calculations, but he has not gotten a response.

Under the directive, probation workers will use spreadsheets to make the
calculations, but they will have to manually enter payments into the
Automated Child Support Enforcement System.

The interest rate on overdue child support is set annually by court rule.
This year, it is only 2 percent, but in prior years it has been as high as
12 percent.

Federal law requires a state to have an automated system capable of
calculating and tracking interest if it charges interest. New Jersey made
the decision not to charge interest when the child support enforcement
program was started in 1975.

Of the 50 states, Washington, D.C., and three U.S. territories, 37 collect
interest, according to the federal Office of Child Support Enforcement.

The federal government pays two-thirds of the state's cost of child support
collection. In fiscal 2005, the federal funding totaled $129.5 million,
according to court papers.



Margaret McHugh covers the Morris County courthouse. She may be reached at
or (973) 539-7119.

Dusty wrote:

http://www.nj.com/news/ledger/jersey...960.xml&coll=1

Probation does not have to calculate interest as arrears accrue, but if the
parent who is owed the money calculates the interest, probation must add it
onto the amount owed, the decision said.

Ah, and no one checks the CP's math? How nice for them.


Parsippany accountant Richard L. Lipton, who created a computer program to
calculate interest due Radol's client, said the state, by failing to collect
interest, is losing out on millions in tax dollars. He noted interest on
overdue child support is taxable income in New Jersey.

So the money gets taxed twice? Once when the NCP earns it, and again
when it is collected and given to the CP?

How nice for the state.


Lipton said he suggested the state contract with his firm to do the
calculations, but he has not gotten a response.

Under the directive, probation workers will use spreadsheets to make the
calculations, but they will have to manually enter payments into the
Automated Child Support Enforcement System.

The interest rate on overdue child support is set annually by court rule.
This year, it is only 2 percent, but in prior years it has been as high as
12 percent.

Federal law requires a state to have an automated system capable of
calculating and tracking interest if it charges interest. New Jersey made
the decision not to charge interest when the child support enforcement
program was started in 1975.

Probably because the state was CONTROLLED by GREEDY WIFEBEATING
CHILDHATING *MEN*!!!

- Ron ^*^

Ah yes, but in turn, when the state STEALS money from your OTHER
children to give to your first child and they DON'T pay it back until
you take them to court in another 8+ years, your OTHER children are NOT
entitled to that interest...nope...not the second children...only first
children are entitled to interest...

Hope all the slums at CSE lose their jobs.

Werebat wrote:
Dusty wrote:

http://www.nj.com/news/ledger/jersey...960.xml&coll=1

Probation does not have to calculate interest as arrears accrue, but if the
parent who is owed the money calculates the interest, probation must add it
onto the amount owed, the decision said.

Ah, and no one checks the CP's math? How nice for them.


Parsippany accountant Richard L. Lipton, who created a computer program to
calculate interest due Radol's client, said the state, by failing to collect
interest, is losing out on millions in tax dollars. He noted interest on
overdue child support is taxable income in New Jersey.

So the money gets taxed twice? Once when the NCP earns it, and again
when it is collected and given to the CP?

How nice for the state.


Lipton said he suggested the state contract with his firm to do the
calculations, but he has not gotten a response.

Under the directive, probation workers will use spreadsheets to make the
calculations, but they will have to manually enter payments into the
Automated Child Support Enforcement System.

The interest rate on overdue child support is set annually by court rule.
This year, it is only 2 percent, but in prior years it has been as high as
12 percent.

Federal law requires a state to have an automated system capable of
calculating and tracking interest if it charges interest. New Jersey made
the decision not to charge interest when the child support enforcement
program was started in 1975.

Probably because the state was CONTROLLED by GREEDY WIFEBEATING
CHILDHATING *MEN*!!!

- Ron ^*^