PARENT'S RIGHTS NOW!

Because of the State’s failure to have a certified statewide CSES operational by October 1, 1997, South Carolina became subject to federal penalties. The full federal penalties are severe. OCSE can disapprove the State’s Child support Enforcement (Title IV-D) State Plan because of the lack of the system. Disapproval would result in the OCSE’s withdrawal of all federal funding, about $22.8 million annually, for the State’s Child Support Enforcement program. The second level of penalty would be the potential disapproval of federal funding for the Temporary Assistance for Needy Families (TANF) program, potentially $99 million annually.

Congress made a less severe alternative penalty available to states that lacked a statewide system if the state was willing to work under federal oversight and under a corrective compliance plan designed to implement a system within a reasonable time.

In January 2001, OCSE notified the State that the alternative penalty was retroactive to federal fiscal year (FFY) 1998, and that continued availability of the alternative penalty to South Carolina is dependent on the State’s good faith efforts to develop and implement a federally certified statewide CSES. In January 2001, South Carolina elected to be subject to the alterative penalty and OCSE approved the corrective compliance plan.

The federal penalty is calculated by CSE for each federal fiscal year based largely on South Carolina's Child Support Enforcement program's actual expenditures, including system development expenditures, reported quarterly to OCSE by DSS.

The alternative penalties will be assessed until lifted by the federal authorities. When the State submits a letter to OCSE requesting certification of CSES, federal system penalties will be placed in abeyance while OCSE certifies CSES. Ninety percent (90%) of any system penalties actually paid for the federal fiscal year in which the letter was submitted are rebated by OCSE back to DSS once the CSES is certified.

For federal fiscal years 1998-2007, the amount of funding lost to penalties was $55,200,000. These penalties are paid with 100% state dollars.

Penalties will continue to be assessed until CSES is deployed and operational, currently projected for June 1, 2010. The amount of these projected penalties is $20,740,046, which includes a 90% reduction of penalties paid in the federal fiscal year in which statewide implementation is intended to occur.