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Wednesday, March 31, 2010

 
SC SUPREME COURT RULES: NO SIXTH AMENDMENT RIGHT TO APPOINTED COUNSEL FOR INDIGENTS IN NONSUPPORT CIVIL CONTEMPT CASES

Frankly, we are surprised with the decision of the South Carolina Supreme Court in the Case of Price v. Turner. We think that the argument advanced by the A. C. L. U. in its Amici Curiae Brief is more legally and logically sound than the Court's reasoning in Price. We also think that it is intellectually dishonest to pretend that (a). these cattle call Rule Hearings involve any semblance of Due Process; (b.) only willful contemnors are ever incarcerated;* and, (c.) any objective observer would conclude that even the majority of these "Deadbeats" possess "the keys to their own jail cells."

Unfortunately, we suspect that the South Carolina Supreme Court had no other choice than to rule in this manner given. As noted in "South Carolina Statehouse Report," South Carolina Supreme Court Chief Justice Jean Toal is essentially having to beg the General Assembly for funding; moreover she has indicated that she wants all the fines and fees generated through the Courts to be used to fund the operation of the Courts.

It goes without saying that if more "Deadbeats" were represented by counsel, fewer would go to jail for contempt and the Courts would receive fewer fines and fees. So there may be an inherent conflict of interest in the South Carolina Supreme Court deciding whether indigents are entitled to a level playing field in their endeavors to avoid paying fees and fines to the Court. Still, the bigger question remains whether incarcerating (warehousing) indigents for non-support is going to "solve for pattern." By definition, indigents do not have money, income, and assets to meet their financial obligations. Therefore, incarcerating them for a year does not create wealth, but only transfers the burden of providing food, clothing, shelter--and sometimes very expensive medical care--from the backs of the indigent "Deadbeats" to the backs of the taxpayers.

While it may be viscerally satisfying and psychologically uplifting to some folks to see the county jails filled to the brim with indigent "Deadbeats," creating Debtor's Prisons, regardless of what you call them, is still--in our view--bad public policy. But good policy or no, given the state of the economy and South Carolina's recent commitment to track down and crack down on "Deadbeats," we anticipate that the county jails will soon be bursting at the seams with indigent contemnors to a point that there will be no space left for either misdemeanor and work release convicts or for the really bad criminals awaiting bond hearings or trials. Where to place those categories of folks will present a greater and greater challenge for the Circuit Court Judges and County Magistrates.

*According to Is the Application of civil contempt in South Carolina’s “daddy round-ups” improper? by Charleston County attorney Gregory S. Forman, Esquire:
Almost every state in the Southeast had determined that it is improper to hold a delinquent parent in jail if he or she lacks the capacity to pay the full amount owed. Ex parte Rojo, 925 S.W.2d 654 (Tex. 1996); Ex parte Talbert, 419 So. 2d 240, 241 (Ala. Civ. App. 1982); In Re Nichols, 749 So. 2d 68 (Miss. 1999); McMiller v. McMiller, 77 N.C.App. 436, 335 S.E.2d 187 (1985); Lee v. Lee, 78 N.C. App. 632, 337 S.E.2d 690 (1985); Lynch v. Lynch, 342 Md. 509, 677 A.2d 584 (1996).

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Tuesday, March 30, 2010

 
MORE ON COUNTING BLESSINGS AND THE MESS AT SOUTH CAROLINA DSS

In our opinion, many of those in charge at DSS are as incompetent as those in charge at the South Carolina Employment Security Commission. Bless her heart, but Dr. Hayes neither has a clue about how to decrease the child support arrearages in South Carolina nor is equipped to run an agency whose primary failures are related to an inability to understand federal law and implement programs mandated by federal law. Therefore, as we noted, SOUTH CAROLINA SHOULD COUNT ITS BLESSINGS. It could certainly be much worse, and in fact, will be a lot worse before the computer system goes on-line. Not only is South Carolina scheduled to be fined another $10 Million this year, but will be fined at least another $1 Million in 2011.

The real shame of this situation is that, not only is South Carolina being fined for failure to implement federally mandated programs, but that because of its failure to take easy, inexpensive steps to increase its rate of child support collections, South Carolina is missing out on huge federal incentives. Moreover, instead of actually doing something to correct the problems, the State is throwing fathers in jail willy-nilly for allegedly being in Contempt without regard to whether they are actually in contempt and without regard to whether doing so generates more money than it costs the State to house, feed, guard, and prosecute them. (Quick, tell us, who benefits from the incarceration of "deadbeats," how many fathers are currently incarcerated in South Carolina jails for failure to pay child support and what it is costing the State to house, feed, guard, and prosecute them. Now tell us how much money is generated in fees and fines and who gets those fees and fines.)

We can tell you who gets the fees and fines when DSS is involved. You find out the answer to the other questions and you will know why South Carolina has neither implemented the New Hire Reporting Program mandated by Congress nor installed the mandated computer system. Punishing “deadbeats” is a profitable business and the county clerks and sheriffs want to maintain control over who receives the fines and penalties and what can be done with them.

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Monday, March 29, 2010

 
EDITORIAL FROM THE POST AND COURIER ON THE SEGARS-ANDREWS CASE

The Editorial can be accessed online at High court's unhappy decision.

The text of the Editorial is set forth hereinbelow.
____________________________________________________________________

Sunday, March 28, 2010

The state Supreme Court this week affirmed the S.C. Judicial Merit Selection Commission's right to disqualify Family Court Judge F.P. "Charlie" Segars-Andrews from continuing on the bench. But that doesn't mean the court was happy about it. For good reason.

Indeed, the court acknowledged the judicial election system provides "a chilling threat to judicial independence." Judges are expected to make tough and often unpopular decisions based on legal principle. Then they are held accountable by legislators who are apt to be more concerned with politics.

In South Carolina, judges are elected by the General Assembly, but only if they are approved by the JMSC, which consists mostly of lawmakers.

Sen. Glenn McConnell, who chaired the panel, applauded the Supreme Court ruling and predicted it will translate into higher standards for judges.

Unfortunately, those assessments often are made by legislators who presumably also are interested in keeping their political allies happy. And in any court case, it is rare that everyone leaves happy. In the case of Judge Segars-Andrews, the screening committee based its decision on a single instance when a litigant complained about her judicial ethics.

The General Assembly faces an unreasonable task in electing judges if the screening commission insists on approving only those who have not made a single mistake.

Ideally, the judicial arm of government is independent of the legislative arm. But in this case the JMSC discounted judicial independence when it disregarded the S.C. Court of Appeals and the state's judicial discipline commission, both of which found the judge's behavior acceptable.

Do judges ever deserve to be disqualified from re-election? Sure they do. But as the JMSC hears complaints about those seeking judgeships, it has a responsibility to hear all sides, and act judiciously. That wasn't the case with Judge Segars-Andrews.

Though the Supreme Court ruling leaves the judicial screening process intact, it should also have the effect of intensifying public scrutiny of the JMSC. South Carolina needs further assurance that the commission is serving its high-minded goals, as claimed.

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Sunday, March 28, 2010

 
SOUTH CAROLINA SHOULD COUNT ITS BLESSINGS

According to the article “System to track S.C. deadbeats,” "Federal officials said in an e-mail South Carolina is working closely with them in monitoring the system's progress, including quarterly visits and bimonthly teleconferences. But the federal agency contends the penalties are set by law and only Congress can undo them (emphasis added)." This is news to some people, but not to the South Carolina General Assembly and South Carolina DSS. As stated eight (8) years ago in Jim Hodges, et. al. v. Tommy G. Thompson et. al.:
The district court opinion contains a comprehensive history, the details of which need not be repeated here, of the federal government’s longstanding involvement in child support enforcement programs and related federal efforts to work with the States to solve the serious problem of nonpayment of child support. See Hodges v. Shalala, 121 F.Supp.2d 854 (D.S.C. 2000). Currently, as a condition of receipt of any federal funding under Title IV-D of the Social Security Act, 42 U.S.C. §§ 651-669, States must have an approved state plan for child and spousal support that meets all the requirements of 42 U.S.C. § 654. Among the prerequisites for approval of a Title IV-D Plan are the requirements that the State establish and operate an automated data processing and information retrieval system, see 42 U.S.C. § 654(24), and a state child support disbursement unit (SDU), see 42 U.S.C. § 654(27)(A). South Carolina concedes that it has neither a federally certifiable statewide automated system for child support nor an SDU. See Hodges, 121 F. Supp. 2d at 86 (emphasis added).

Without an approved state plan, a State may lose federal funding under both Title IV-D (child support enforcement) and Title IV-A (TANF). See 42 U.S.C. § 655(a)(1)(A); 42 U.S.C. § 602(a)(2). Alternatively, a State may opt for an alternative penalty in lieu of disapproval of their state plan and the withholding of federal funds if the State is making a good faith effort to comply with the program’s requirements and the State has submitted a corrective compliance plan. See 42 U.S.C. § 655(a)(4). South Carolina has elected to incur the alternative penalty.
This Order makes clear that South Carolina is lucky to have avoided loosing both Title IV-D (child support enforcement) and Title IV-A (TANF) funding. Certainly, as Dr. Hayes indicates, "money, if not forfeited, could be deployed to help some 250,000 single parents in South Carolina seeking child support through her agency." So the State should count its blessings, get to work solving this problem, and cease playing the victim.

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Saturday, March 27, 2010

 
NEW SOUTH CAROLINA COMPUTER SYSTEM TO TRACK "DEADBEATS"

We direct your attention to the article “System to track S.C. deadbeats.” The article contains some inaccuracies and The Post and Courier has assigned a title that is both provocative and inaccurate. Still, this is an important piece and ought to send a wake-up call to the South Carolina General Assembly regarding the underfunding of DSS, the sheer incompetence of Larry McKeown and other well-paid employees of the South Carolina CSED, and the need for South Carolina to begin to comply with federal law.

For the readers' information--and in fairness to Dr. Hayes--the computerized child support tracking and collection system referenced in the article was mandated by the Personal Responsibility and Work Opportunity Reconciliation Act, which was passed in 1996. The system was required to be in place by 1998, not 1988.

There are other aspects of the PRWORA which South Carolina is continuing to violate. We blogged about one of them at TRYING TO GET THE SC NEW HIRE REPORTING STATUTE "RIGHT." We have also made suggestions for cleaning up "the Mess at DSS."

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Wednesday, March 24, 2010

 
FRANCES P. SEGARS-ANDREWS. PETITIONER V. JUDICIAL MERIT SELECTION COMMISSION, ET. AL.

The opinion in Frances P. Segars-Andrews, Petitioner, v. Judicial Merit Selection Commission, The State of South Carolina, Andre Bauer, in his official capacity as President of the South Carolina Senate, and Glenn F. McConnell, in his official capacity as President Pro Tempore of the South Carolina Senate, and Robert W. Harrell, Jr., in his official capacity as Speaker of the South Carolina House of Representatives, Respondents can be accessed here.

We cannot take issue with the South Carolina Supreme Court's reasoning. However, if the sole--or even most glaring--"mistake" that Judge Segars-Andrews made during sixteen (16) years on the Bench was her failure to recuse herself in one particular case, then we must conclude that the members of the Judicial Merit Selection Committee acted arbitrarily in concluding that she is unqualified to continue serving on the Bench. Unfortunately, they have put a stink on Judge Segars-Andrews that will never wash off. More important, after being made aware of this case, any sane person should have serious misgivings about even considering becoming a judge.

Tuesday, March 23, 2010

 
POSTPONING DIVORCE IN A DOWN MARKET

Lisa Belkin writes in "Postponing Divorce in a Down Market":
There’s staying together because of the children, and now there’s staying together because of the economy.

In The Washington Post’s metro section yesterday, the reporter Donna St. George explored whether a recent downtick in the divorce rate (there were nearly 20,000 fewer in 2008 than in 2007) has been caused by the Great Recession. “How do they start over if debt is all that’s left to divide?” she asks.

Not too long ago, many couples used the equity in their homes to finance a split, with each spouse walking away with enough to finance a new life once their joint property was sold.
Interesting enough, we, as a society, appear to recognize that the economy impacts on people's ability to meat their financial obligations. Unless, that is, the obligations are child support obligations.

Monday, March 22, 2010

 
WEST VA [BUT NOT SC] CHANNELS MORE CHILD SUPPORT TO POOR

According to "W. Va. diverts more child support to poor":

Changes in how state governments are allowed to disperse child support payments to welfare families has put more money in the pocket of West Virginia resident Becky Salmons, allowing her to buy school supplies and medicine for her 17-year-old daughter.

West Virginia, Pennsylvania and Washington are among the states taking advantage o f changes in federal law that encourage states to stop using the money to reimburse state and federal welfare services and instead use it to help poor families get back on their feet. For some families, the change means hundreds of extra dollars a month.Until a year ago, most of the $225 Salmons' ex-husband paid each month went to the government. Now, she gets all the money."Moneywise it was rough," said Salmons, who moved in with her mother in southwest West Virginia following her divorce three years ago. "We just had to scrimp and save, but family members would help out as much as they could."The policy changes were a gradual philosophical shift for child support payment programs that began a decade ago and were reinforced by Congress in 2006, said Vicki Turetsky, commissioner for the Office of Child Support Enforcement in the U.S. Department of Health and Human Services.

States had until Oct. 1 to at least take some small step toward putting more money into welfare recipients' hands.

Federal officials hope the money will help welfare families become more self-sufficient, thereby reducing the demand for food stamps and other government assistance. Turetsky said a pilot project in Wisconsin showed parents were more likely to pay child support and pay it in a timely manner if the money went to their children rather than reimburse government agencies. "The net cost to the government was minimal because parents were paying more and families had less need to receive public assistance," Turetsky said.

The federal Office of Management and Budget estimates the changes could result in $4.9 billion in savings nationwide over 10 years as more families leave assistance programs. The federal policy changes allow states to choose from a smorgasbord of options to funnel current and overdue child support collections to current and former families receiving Temporary Assistance for Needy Families, or TANF. Many states have been slow to embrace all the changes, though, because of severe budget problems. Turetsky said West Virginia was the first state to implement all the options. West Virginia Child Support Commissioner Susan Perry said there is a potential to put $85 million in child support into the hands of about 18,000 families. Before, the federal and state governments split child support payments 80-20 for TANF benefits. Federal authorities agreed to give up their 80 percent, but states have been reluctant to give away the money. Budget concerns are keeping Minnesota from passing along all of the money to families." It is always a matter of competing priorities," said Beth Voigt, spokeswoman for the Minnesota Department of Human Services' Child Support Enforcement and Transition to Economic Stability Divisions.

In Pennsylvania, the full impact of the changes won't be known for another year, director of the Pennsylvania Bureau of Child Support Enforcement Dan Richard. But the amount of money going to low-income families already has increased from $5 million to $21 million.Adolfo Capestany, spokesman for the Washington Department of Social and Health Services' Division of Child Support, said between last Oct. 1 and Aug. 31, Washington distributed $12.5 million to roughly 12,400 families. While acknowledging that budget constraints may force Washington state to revisit the changes, Capestany said, "This has been a tremendous help for our low-income families."

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Sunday, March 21, 2010

 
THE ANGRY DAD BLOGSPOT--"JUST ANOTHER DAD WHO IS OUTRAGED BY THE FAMILY COURT SYSTEM"

While we think that this blogger raises many valid points on some of his posts, we also think that his defense of Joseph Reyes as the "New Rosa Parks" is as ludicrous as Mr. Reyes' claims that he is Catholic and that Catholicism, rather than being distinct from Judaism, is just a "radical" form of Judaism.

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Saturday, March 20, 2010

 
CHILD SUPPORT AND DEBTOR’S PRISON

From time-to-time we comment on the issue of incarcerating people for failure to pay support obligations. We try to remain even-handed on the subject. In that vein, information at this link presents the con side of the argument and poses some valid questions about the use of the contempt powers of the Courts against individuals who have no ability to comply with the Court's Orders.

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Friday, March 19, 2010

 
PROSECUTION FOR FAILURE TO ATTEND AFTERSCHOOL "EDUCATION" CLASSES FOUND TO BE UNCONSTITUTIONAL

Parents of some teenagers who were "sexting" have gotten some relief from the Third Circuit Court of Appeals in a recent decision. The kids were allegedly involved in sending either "provocative" (bathing suit), semi-nude, or nude photographs of minors on cell phones and had been ordered to take afterschool "education" classes to avoid prosecution for distribution of child pornography. Some of the parents brought suit to enjoin prosecution, the relief was granted, and the prosecutor appealed the ruling. A law professor blog explained the Appellate Court's Decision to uphold the Trial Court's ruling:
Threatening to prosecute the children for refusing to attend the education program interfered with the parents’ parental rights and the children’s rights to be free of compelled speech, because it threatened governmental retaliation for the exercise of constitutional rights. ...At the same time, it’s important to realize the potential breadth of such a holding: It would mean that pretrial diversion programs that seek to substitute rehabilitative education for prosecution, in cases (usually involving first offenses or not very serious offenses) far beyond sexting — for instance, drug crimes, drunk driving, assault, domestic violence, child neglect, traffic law violations, and the like— would be presumptively unconstitutional. Such coerced participation in “the education program[s] would violate [defendants’] First Amendment freedom against compelled speech” just as coerced participation in anti-sexting classes would (probably even as to adults and certainly as to minors).

Thursday, March 18, 2010

 
A GUIDE TO THE NATIONAL DIRECTORY OF NEW HIRES

Those who are policy wonks and who like to fill their heads with useless information can click A Guide to the National Directory of New Hires to access the document. We refer to the information as useless because "This guide is to provide federal and state agencies requesting data from the NDNH with a general overview of the data maintained in the NDNH and the limitations on its use. Commercial entities (e.g., law firms and collection agencies) do not have access to the NDNH."

In other words, if a person lives in a State like South Carolina, which does little or nothing to enforce the new hire laws, he or she may be stuck receiving the minimal amount of child support for his or her children's entire minority.

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Wednesday, March 17, 2010

 

TRYING TO GET THE SC NEW HIRE REPORTING STATUTE "RIGHT"

As many people are aware, we have long advocated amending the South Carolina New Hire Reporting Statute to both make it conform to federal mandates and to remove conflicts with Title 43 of the South Carolina Code. Earlier this week, an e-mail was forwarded to us that both criticised the specifics of our proposal and served to update us concerning efforts in the South Carolina General Assembly to amend Title 63 of the South Carolina Code to conform to federal law. The e-mail had been edited somewhat to "protect the innocent." And we are editing it further both to "protect the innocent" and to remove some immaterial or irrelevant portions (in our opinion) of the forwarded e-mail:

As to the issue of leaving both Title 43 and Title 63 provisions in the Code (which is what I believe you are proposing), I am at a loss to understand the wisdom of such a move. Our present problem stems from the fact that we have two separate statutes creating two separate New Hire Programs. One is voluntary (and was created in the late 1970s before the federal law was enacted) and contains many provisions that are inconsistent (and probably conflict) with federal law. The other is mandatory and mirrors the federal requirements. Why you or anyone (DSS also proposed this idea initially, but they have since agreed that one of the Sections needs to go) would advocate leaving both Title 43 and Title 63 intact is beyond my comprehension. Title 63 and Title 43 are inconsistent. They are inconsistent regarding when reports must be submitted, the contents of the reports, and several other matters, and Title 63 fails to exempt certain workers and fails to allow multi-state employers to choose a single state from which to file a report. The New Hire Program currently found in Title 63, whether it’s made mandatory or remains voluntary, needs to go. The New Hire Program in Title 43, with the few technical revisions I made to it in [a proposed] bill, is the plan that complies with federal law.

I imagine that DSS will have some kind of a position on this bill. But I have it from Mr. Bray, the legislative liaison for DSS, that DSS concedes that the current Title 63 program does not comply with federal law, and that the language in Title 43 does.
Initially, our focus was only on § 63-17-1210 of the South Carolina Code and the removal of one particular statutory section that we believed conflicted with both 42 U. S. C. 653a and § 43-5-598 of the South Carolina Code. We could not even get anyone in the General Assembly to even read the PRWORA in its entirety, much less to agree that there were internal conflicts within the South Carolina Code. However:
  1. There now appears to be a consensus that § 43-5-598 complies with the mandates of 42 U. S. C. 653a, that “Title 63 and Title 43 are inconsistent,” and that § 63-17-1210 “contains many provisions that are inconsistent (and probably conflict) with federal law;”
  2. DSS now agrees that “[t]he New Hire Program currently found in Title 63...needs to go;” and,
  3. “DSS concedes that the current Title 63 program does not comply with federal law, and that the language in Title 43 does.”
The preceding enumerated circumstances change the scope of the matter and also, in our opinion, both change the appropriate remedy to the problem and increase the potential for passing appropriate remedial legislation in South Carolina. Therefore, we suggest, rather than recodifying § 43-5-598 in Title 63 of the South Carolina Code, that the South Carolina General Assembly simply repeal § 63-17-1210 in its entirety. That would leave the entire statutory scheme set forth in Title 43 intact, would obviate the need for a "savings clause," and would allow South Carolina to avoid having to address the question of whether South Carolina is presently in conformity with federal law. Additionally, as a practical matter, we think it will be easier for DSS, and whoever else supports amending the New Hire Reporting Statute to conform to federal law, to convince the members of the General Assembly to go along with the suggested amendments if it is made clear that no new sweeping legislation is being introduced, but only that a statutory provision which, from a technical standpoint, was repealed by implication when § 43-5-598 was enacted, is now being formally repealed.

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Tuesday, March 16, 2010

 
SC AG CANDIDATE BOLCHOZ OPPOSES EARLY RELEASE OF PRISONERS DUE TO BUDGET CUTS

According to the Press Release "Attorney General Candidate Bolchoz Opposes Early Release of Prisoners Due to Budget Cuts"

"I am calling on elected officials at every level to ignore special interests and acknowledge their number one responsibility to the people of this State by making public safety funding the number one budget priority. Every South Carolinian, regardless of race, creed, color, or political affiliation deserves the protection of the Government from criminals. Only in a safe community can our students begin to learn and our businesses begin to prosper. Our leaders must stop overfunding bloated bureaucracies which fail in their objectives, while underfunding critical services established to protect lives and property, said Bolchoz” (sic)
We understand where Mr. Bolchoz is coming from. Still, we cannot help thinking that there are at least some "Deadbeats" who do not belong in jail and who could be released early without jeopardizing the public safety. We concede that Mr. Bolchoz is entitled to his opinion. We only think that he ought to identify the over funded "bloated bureaucracies which fail in their objectives" and whose budgets he wants to cut. For example, if it is DSS's budget he wants to cut, we are with him. We say start by firing Larry McKeown. Lenora Reese Bush, and Virginia Williamson and terminating the pass through payments to Heritage Community Services. However, if Mr. Bolchoz wants to reduce funding for DDSN we would insist that he travel to Dorchester County and tell State Senator Rose, State Representatives Young and Horne, and Jerry Musselman of his plan. It is high time for the "special interests" to be identified by name and for pandering to cease.

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Friday, March 12, 2010

 
AUDITORS ARE SEACHING FOR MISSING MONEY IN BEAUFORT COUNTY

According to "Auditors probe missing money in Beaufort county":

It's more than pocket change missing in one South Carolina county — it could be as much as $300,000 — and authorities are trying to find out where the money went.

The Beaufort Gazette reported accountants hired by the county administrator and the county's top prosecutor began working this week on an audit.

The money is missing from the county treasurer's office from a delinquent tax sale last year. Sheriff P.J. Tanner says estimates of the missing money range from $4,000 to $300,000.

A former treasurer's office employee has been charged with breach of trust with fraudulent intent in the theft of $600 from the office several years ago. Authorities say that worker is a person of interest in the latest investigation.

This case is another illustration of the need to have greater transparency and accoutabiliy of finances of the court system.

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Thursday, March 11, 2010

 
WHY WOULD A SOUTH CAROLINA STATE SENATOR INTRODUCE LEGISLATION THAT VIOLATES FEDERAL LAW?

Last week we posted a proposed amended version of § 63-17-1210 South Carolina Code Ann. (1976, as amended).* More important, Republican South Carolina State Senator Michael Rose introduced Legislation that attempts to bring South Carolina's New Hire Reporting Statute into conformity with federal law by repealing § 43-5-598 of the South Carolina Code and amending § 63-17-1210 to make the new hire reporting aspects of the law mandatory rather than voluntary.

We commend Senator Rose for his efforts. Unfortunately, while his proposed Bill does, in fact, address the problem we initially raised, we believe it creates other problems that may or may not be as severe. Additionally his proposed Bill itself conflicts with 42 U.S.C. § 653a. Moreover, by providing employers with additional time to comply with 42 U.S.C. § 653a and providing DSS with additional time to create a New Hire Reporting Directory Senator Rose is, in essence, admitting that South Carolina has been out of compliance of federal law for twelve years. As we previously wrote, § 63-17-1210 South Carolina Ann. (1976, as amended) conflicts with 42 U. S. C. § 653a. § 43-5-598. On the other hand, as we have also previously noted, § 43-5-598 of South Carolina Code Ann. (1976, as amended) conforms with federal law and provides in relevant part, "This section remains in effect until the federal mandate requiring a mandatory new hire reporting program is repealed."

Clearly, the federal mandate requiring a mandatory new hire reporting program has not been repealed. Therefore, we wonder why a South Carolina State Senator would even consider introducing Legislation that would repeal the § 43-5-598.

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Wednesday, March 10, 2010

 

COURT FINES AND FEES IN THE SOUTH CAROLINA COURT SYSTEM

Bill Davis writes in the latest edition of "South Carolina Statehouse Report" :

A dust up this week in the Senate Judiciary Committee over the seemingly small issue of whether state courts will get to keep the fees and fines they charge could serve as a Statehouse weathervane, telling which way the state’s tax structure may be headed.

Two years ago, S.C. Supreme Court Chief Justice Jean Toal began warning legislators about the state court system’s financial woes -- that drooping funding was resulting in a growing case backlog and the loss of key staff.

Last year, the House moved to give the courts more money,and early this session, the Senate began taking up the issue. Spurring the fight in the Senate committee was the shift in funding sources feeding the courts.

According to 1997-98 numbers provided by Senate Finance staff, the courts received just short of 40 percent of its funding from the state’s General Fund budget.

But by 2007-08, that General Revenue had dropped to 34 percent. Tax cuts led to fewer dedicated state dollars. Then a series of mid-year tax cuts hit the courts hard, just as cuts impacted dozens of other state agencies and services. In the end, relying less on General Fund money forced the courts to rely more on fines and fees.

Courts argue to keep fines, fees

Toal came and spoke before legislators on Tuesday, and further made her case.

“As I began my tenure as your chief justice 10 years ago, it took about $46.5 million to run the state court system and almost all of it was raised by regular general appropriations funds,” said Toal, a former House member. “There were no federal funds and very little in the way of state fees.”

The House Ways and Means general revenue budget for the Judicial Department for 2010-11 is $22.6 million. Toal told senators that the courts system is in reality down $11.5 million, thanks to end-of-the-year budget cuts and rapidly evaporating federal stimulus funds. “We can't continue to operate like this.”

Back in committee, with Toal’s remonstrance still in their ears, the full Judiciary tackled the issue. And that’s when the fight over fees and fines started.

Several members of Judiciary, including its chairman,Senate President Pro Tempore Glenn McConnell (R-Charleston) dug in their heels about keeping all fines and fees at home in the court system.

The rhetoric that popped up, according to several sources, was that there was no way Judiciary was going to turn over the fines and fees to the Finance Committee to squirrel away into the General Fund and then distribute the money to other agencies.

This got to the philosophical heart of the issue.

Library approach vs. Netflix approach

In the past, South Carolina state government budgeting has been more like a library, where resources are put in collectively, and then drawn out by priority.

But now with fines and fees becoming more prevalent as an “other funding source” in budgeting nomenclature, will the state process become more like Netflix and force citizens to pay for services they use through fees, fines and special charges?

Fines and fees have been a comfortable lightning rod for state government’s critics. The S.C. Policy Council released a report last year that said that a full third of the state’s overall budget, approximately $7 billion, was from fines and fees.

That may be an oversimplification, as Budget and Control Board spokesperson Michael Sponhour pointed out, that the $7 billion could also include categories of funding like tuition.

McConnell said that, because of the current ongoing tax revenue downturn, he saw no reasonable option but to let the courts keep their fines and fees. But, he added, he would look for a different solution in two years or so, when tax revenues have likely rebounded.

Finance Chair Hugh Leatherman (R-Florence) said he was also “OK” with allowing the courts to keep them, too. He said it will likely be three to four years before the state’s economy “gets back to what it was.”

Leatherman likened the situation with the courts to DHEC, which generates a large amount of its budget through permitting fees and fines.

Shortfalls of Netflix approach

Critics, such as Sen. Robert Ford (D-Charleston), say fines and fees are “shadow taxes.” Ford, seated in the antechamber of the Senate this week, said “a tax is a tax is a tax, and fines and fees are taxes.”

Charging fees may be good for the courts, but Ford said it was tough luck for innocent people hauled into court who still had to pay them.

Holley Ulbrich, a senior scholar at the Strom Thurmond Institute at Clemson University, said fines and fees have an extra marketing value to legislators.

“They are easier to sell than a tax, because if it’s earmarked, then it’s easier for [voters] to see it going for something specific, versus just being poured into the General Fund,” said Ulbrich.

But there are downsides to this kind of budgeting, she said. “This is like a teenager just asking money from their parents for one thing,” said Ulbrich.

South Carolina is far from the only state struggling with making its budget and striking the balance between taxes and fines and fees. North Carolina had a similar situation last year, but responded with income and sales tax increases to offset roughly half the funding gap.

North Carolina, a hotter hotbed of progressive politics than conservative South Carolina, has a longer history in raising taxes and investing in the state, as evidenced by the success of the Research Triangle in that state.

Some watchers are now concerned that with North Carolina increasing taxes and South Carolina, where the House passed a measure this week to cut all corporate income taxes, could fall behind again because of its aversion to tax increases.

“It’s short-sighted,” said Ulbrich, commenting on what she sees as the state falling behind funding its “educational infrastructure.”

McConnell disagreed, saying the success of hydrogen research at Clemson, the institute’s home, and the landing of Boeing expansion in the Charleston area, the state can keep up with its neighbors.

Crystal ball: With Judiciary voting to keep fines and fees in the hands of the court system, the Netflix “pay-as-you-go” funding approach will likely continue -- at least until more money arrives in state coffers via an improving economy or (gasp!) a tax hike. And with economic forecasts predicting a flat revenue curve until at least 2013, it could get more serious.
We agree with both South Carolina State Senator Robert Ford and State Senator Hugh Leatherman. While fines and fees are "shadow taxes," the Court System ought to be able to use them for operating expenses. However, to avoid a repeat of the events in Beaufort County and Dorchester County, there should be both transparency and accountability regarding the collection and expenditure of these funds.

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Monday, March 08, 2010

 
SC STATE SENATOR INTRODUCES LEGISLATION THAT ATTEMPTS TO REVISE SC'S NEW HIRE REPORTING STATUTE TO CONFORM TO FEDERAL LAW

Last week we posted a proposed amended version of § 63-17-1210 South Carolina Code Ann. (1976, as amended).* More important, Republican South Carolina State Senator Michael Rose introduced Legislation that attempts to bring South Carolina's New Hire Reporting Statute into conformity with federal law by repealing § 43-5-598 of the South Carolina Code and amending § 63-17-1210 to make the new hire reporting aspects of the law mandatory rather than voluntary.

We commend Senator Rose for his efforts. Unfortunately, while his proposed Bill does, in fact, address the problem we initially raised, we believe it creates other problems that may or may not be as severe. Additionally his proposed Bill itself conflicts with 42 U.S.C. § 653a. Moreover, by providing employers with additional time to comply with 42 U.S.C. § 653a and providing DSS with additional time to create a New Hire Reporting Directory Senator Rose is, in essence, admitting that South Carolina has been out of compliance of federal law for twelve years.

We have been lead to believe that DSS does not need additional time to create a New Hire Reporting Directory. In fact, Larry McKeown assured us that a New Hire Reporting Directory already exists and that thousands of South Carolina employers already comply with the new hire reporting mandates of 42 U.S.C. § 653a. So why not leave § 43-5-598 intact and immediately make the necessary changes to § 63-17-1210? In all likelihood, it will be weeks before the remedial Legislation can be signed into law by the Governor, so employers will have plenty of time to "voluntarily" comply with the current version of § 63-17-1210 now that they know a remedial Bill is in the pipeline. And, we would think that the AG's Office, the South Carolina State Senate, DSS, and the Office of the Lt. Governor would all want to make sure that they are presently in compliance with existing federal laws before any new and cumulative/repetitive South Carolina Laws come into effect.

We appreciate--in both senses of the word--what Senator Rose is up against in his efforts to rectify what was hopefully merely a mistake on the part of the South Carolina General Assembly. However, in drafting remedial Legislation, Senator Rose should remain cognizant of the fact that, as DSS has advised the General Assembly, South Carolina has been--and will continue to be--severely fined for its failure to comply with other aspects of the PRWORA. Moreover, the South Carolina General Assembly must be mindful of the fact that its failure to correct its New Hire Reporting Statute can be taken into consideration by the United States Department of Health and Human Services in deciding whether to continue to impose fines against South Carolina for its failure to implement a computerized child support collection and tracking system or whether to impose more severe penalties.

In short, while there is no upside for South Carolina allowing employers additional time to comply with § 63-17-1210 and 42 U.S.C. § 653a., there is a great deal of downside to Senator Rose's proposed Legislation. Therefore, unless the amended Legislation can be revised to "solve for pattern,"** it should be scrapped.

*Those who wish to review our proposed Legislation may view it at REVISING SOUTH CAROLINA'S NEW HIRE REPORTING STATUTE TO CONFORM TO FEDERAL LAW.”

**The concept of "Solving for pattern," was coined by Wendell Berry in his essay of the same title and is the process of finding solutions that solve multiple problems while minimizing the creation of new problems. The essay was originally published in the Rodale Press periodical "The New Farm." And although Mr. Berry used the phrase in direct reference to agriculture, it has since come to enjoy broader use among problem-solvers of all stripes.

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Saturday, March 06, 2010

 
SOUTH CAROLINA DEPARTMENT OF SOCIAL SERVICES TO BE AUDITED?

Bill Davis writes in the March 5, 2010 edition of South Carolina Statehouse Report:

DSS may be next

Move over DOT, ESC. The next acronymic state agency that might get investigated by the LAC (Legislative Audit Council) may be DSS, or the S.C. Department of Social Services.

Senate leaders reportedly are not pleased with reports that the agency that is charged with assisting and protecting some of the state’s most vulnerable citizens may have to pay between $10 million and $13 million in fines for this year and next year for failing to comply with federal guidelines. The agency is already struggling due to a sudden increase in calls for family assistance as a failing economy has caused major stress on many South Carolina families (emphasis added).
While we do not doubt the accuracy of Mr. Davis' prediction, we do have two observations and one question.

First, the observations: (1)The fact that federal fines are to be assessed against South Carolina is such old news that we are surprised that anyone who covers South Carolina State Government would find this currently newsworthy. (2.) There is no need to perform an audit to determine who is to blame for the Mess at DSS; Larry McKeown and the General Assembly share the blame for the years 1998--2008 inclusive and Dr. Kathleen Hayes, Virginia Williamson, Esq., Larry McKeown, and the General Assembly share the blame for the years 2009-2012 inclusive.

And, now the question: Which Senate Leaders have just now become "not pleased" with a problem that has existed for over five (5) years? After all, this is one of the issues that House Freshmen were demanding answers about last year.

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Wednesday, March 03, 2010

 

REVISING SOUTH CAROLINA'S NEW HIRE REPORTING STATUTE TO CONFORM TO FEDERAL LAW

Although South Carolina's "Employer New Hire Reporting program" statute is both poorly written and fails to conform to Federal mandates regarding the mandatory nature of the reporting of new hires by employers, it can be made to conform simply by removing three words and adding one word. Our proposed "amended statute" is set forth hereinbelow. The words highlighted in red--"voluntarily" and "may"--are the words that should be removed. The word to add--"shall"--is highlighted in purple.

Admittedly, there are better versions of this statute available, but this one will do the trick.

So what has taken South Carolina so long to revise this statute? And why are Virginia Williamson and Larry McKeown still employed by South Carolina DSS?

_______________________________________________

SECTION 63-17-1210. Employer New Hire Reporting program.

(A) By January 1, 1996, the Child Support Enforcement Division of the Department of Social Services shall create and develop an Employer New Hire Reporting program. The Employer New Hire Reporting program shall provide a means for employers to voluntarily assist in the state's efforts to locate absent parents who owe child support and collect child support from those parents by reporting information concerning newly hired and rehired employees directly to the division.

(B) The following provisions apply to the Employer New Hire Reporting program:

(1) An employer doing business in this State shall may participate in the Employer New Hire Reporting program by reporting to the Child Support Enforcement Division:

(a) the hiring of a person who resides or works in this State to whom the employer anticipates paying earnings; or

(b) the rehiring or return to work of an employee who was laid off, furloughed, separated, granted leave without pay, or terminated from employment.

(2) The Employer New Hire Reporting program applies to a person who is expected to:

(a) be employed for more than one month's duration;

(b) be paid for more than three hundred fifty hours during a continuous six-month period; or

(c) have gross earnings of more than three hundred dollars in each month of employment.

(3) An employer who voluntarily reports under item (1) shall submit monthly reports regarding each hiring, rehiring, or return to work of an employee during the preceding month. The report must contain:

(a) the employee's name, address, social security number, date of birth, and salary information; and

(b) the employer's name, address, and employer identification number.

(4) Employers reporting to the Employer New Hire Reporting program shall provide information to the Child Support Enforcement Division by:

(a) sending a copy of the new employee's W-4 form;

(b) completing a form supplied by the Child Support Enforcement Division; or

(c) any other means authorized by the Child Support Enforcement Division for conveying the required information, including electronic transmission or magnetic tapes in compatible formats.

(5) An employer is authorized by this section to disclose the information described in item (3) and is not liable to the employee for the disclosure or subsequent use by the Child Support Enforcement Division of the information.

(6) Information received by the South Carolina Employment Security Commission from employers which includes information contained in the reports provided for in this section must be transmitted to the Department of Social Services within fifteen working days after the end of each quarter.

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Tuesday, March 02, 2010

 
TABLE 7: COLLECTIONS AND EXPENDITURES--COMPARING ALABAMA, MISSISSIPPI, AND SOUTH CAROLINA

Click Table 7: Collections And Expenditures, FY 2008 to access the most recent federal data regarding child support collections and expenditures among the various states.

Because they are often the States that are "first in everything bad and last in everything good," we were curious as to how Alabama, Mississippi, and South Carolina compared. Alabama collected $280,243,467, forwarded $22,957,324 to other States, and sent $209,611 to other countries. Mississippi collected $245,318,189, forwarded $12,007,624 to other States and forwarded a measly $42,467 to other countries. South Carolina collected $249,830,407, sent $11,951,866 to other States, and sent $00,000,000 to other countries.

We note that South Carolina collected the lowest percentage of what was owed and sent the least amount to other States and other countries. In other words, South Carolina is again ranked at the bottom.

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Monday, March 01, 2010

 
THE 1996 FEDERAL WELFARE REFORM ACT IS WORKING--A CONTRARY VIEW TO THAT OF ANDRE BAUER

According to "Welfare Reform Turns Ten, Evidence Shows Reduced Dependency, Poverty" by Christine Kim and Robert Rector, The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) is working. Ms. Kim and Mr. Rector note that PRWORA had three stated goals: "1) to reduce welfare dependence and increase employment; 2) to reduce child poverty; and 3) to reduce out-of-wedlock childbearing and strengthen marriage." They noted further that, "In the ten years since its enactment, welfare reform has succeeded in each of these areas." They then go on to say:
Welfare caseloads began to decline in earnest after 1996 and have fallen by 56 percent since then.

This decline in welfare dependence coincided with the increase in the employment of single mothers. These trends have been particularly dramatic among those who have the greatest tendency to long-term dependence: younger never-married mothers with little education.

During the late 1990s, employment of never-married mothers increased by nearly 50 percent, of single mothers who are high school dropouts by 66 percent, and of young single mothers (ages 18 to 24) by nearly 100 percent. Welfare reform impacted the whole welfare caseload, not just the most employable.

Not surprisingly, as families left welfare and single mothers transitioned into work, the child poverty rate fell, from 20.8 percent in 1995 to 17.8 percent in 2004, lifting 1.6 million children out of poverty. The declines in poverty among black children and children from single-mother families were unprecedented.

Neither poverty level had changed much between 1971 and 1995. By contrast, six years after PRWORA was enacted, these two poverty rates had fallen to their lowest levels in national history, from 41.5 percent to 30 percent for black children and from 53.1 percent to 39.8 percent for children from single-mother families.

Since welfare reform, the once explosive growth of unwed childbearing has ended. The unwed birthrate was 7.7 percent in 1965 and increased about one percentage point per year for the next thirty years. Had this rate of increase been sustained, the unwed childbearing rate would have hit 41.6 percent by 2003, but welfare reform interrupted this process. Between 1995 and 2003, overall unwed childbearing inched upward by only 2.4 percentage points, a fourth of the pre-reform rate of increase. The black unwed childbearing rate actually fell from 69.9 percent in 1995 to 68.2 percent in 2003.
If the statistics cited by Ms. Kim and Mr. Rector are accurate, we have to agree with them regarding the success of the PRWORA. So we can only surmise that Andre Bauer knows something that they do not know. Else he would not be pushing for reforms. Or would he?

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