State of the Union 2000


January 26, 2000

Today, the White House will unveil a major new initiative to promote work, child support, and responsible fatherhood. The responsible fatherhood initiative is part of President Clinton's FY 2001 budget. It will include new measures to 1) collect child support from parents who can afford to pay; 2) ensure that more child support goes directly to families, and 3) provide funds to help more "deadbroke" fathers, who owe child support, go to work. These responsible fatherhood proposals are a critical next step in welfare reform, and will build upon the President's efforts to help low-income families succeed in the workforce. The White House today will also announce new data showing that thanks to the Administration's child support crackdown, collections have nearly doubled since President Clinton took office.

COLLECTING MORE CHILD SUPPORT FROM FATHERS WHO CAN PAY. The President's budget will include new initiatives to crack down further on parents who owe child support. These initiatives will collect nearly $2 billion for children over the next five years by:

  • Booting the Cars of Deadbeat Parents. This will take nationwide a policy adopted in Virginia that immobilizes vehicles owned by deadbeat parents until they begin to pay what they owe. During the pilot phase, this initiative collected an average of $5,000 from each deadbeat parent. This new tool will enable every state to collect more child support; there will be safeguards to ensure that those legitimately trying to pay are not targeted.
  • Intercepting Gambling Winnings to Collect Past-Due Child Support. Gambling winnings are a form of income, which until now has been out of reach to families who are owed child support. Under this initiative, gambling establishments will check whether individuals with large winnings owe child support as they complete existing procedures for withholding federal income taxes. Gamblers owing child support will have their winnings seized.
  • Denying Passports to Parents Who Owe $2,500 or More in Child Support. This proposal will deny passports to parents owing more than $2,500 in child support. This expands the current passport denial program, which rejects passport applications or renewal requests if child support arrearages exceed $5,000, and currently results in 30-40 denied passports per day. Rejected parents often pay child support immediately in order to obtain their passports.
  • Prohibiting Medicare Participation by Providers Owing Child Support. This bars doctors and other health providers who owe child support from becoming Medicare providers.
  • Requiring More Frequent Updating of Child Support Orders. This proposal will require states to review support orders every three years for families receiving Temporary Assistance Needy Families and adjust them accordingly. New orders reflecting parents' updated salary information will bring more child support to children who need it.

STREAMLINING CHILD SUPPORT RULES SO MOTHERS GET MORE RELIABLE CHILD SUPPORT INCOME. The President's budget will contain a proposal that will ensure that more child support goes directly to families. Current child support distribution rules are complicated, and often result in government, not families, keeping child support monies paid by the father. Today's proposals will enable states to simplify distribution rules and provide incentives to states that pass through more child support payments directly to families. In states that adopt the new options, families that have left welfare will be able to keep all the child support paid by the noncustodial parent; families still working their way off welfare will be able to keep up to $100 a month. These proposals will create a clearer connection between what a father pays and what his family gets, giving parents more reason to cooperate with the child support system.

HELPING LOW-INCOME FATHERS AND WORKING FAMILIES SUPPORT THEIR CHILDREN. The President's budget also proposes $255 million for the first year of a new "Fathers Work/Families Win" initiative to help low-income non-custodial parents and low-income working families work and support their children.

  • Fathers Work. To ensure that low-income fathers who are not living with their children provide the financial and emotional support their children deserve, the President's budget will include $125 million for new "Fathers Work" grants. These grants will help approximately 40,000 low income non-custodial parents (mainly fathers) work, pay child support, and reconnect with their children. As part of this effort, states will need to put procedures in place allowing them to require more parents who owe child support to pay or go to work, expanding current requirements to include parents of children not on welfare. This initiative builds on over $350 million in responsible fatherhood initiatives funded through the Labor Department Welfare-to-Work program.
  • Families Win. To reward work and responsibility and ensure that all families benefit from the booming economy, the President's budget will include $130 million in new grants to help hard-pressed working families get the supports and skills they need to succeed on the job and avoid welfare. These funds will leverage existing resources to help families retain jobs and upgrade skills, and get connected to critical work supports, such as child care, child support, health care, food stamps, housing, and transportation. Families Win grants will serve approximately 40,000 low-income families, including mothers and fathers, former welfare recipients, and people with disabilities. Within these funds, $10 million will be set aside for applicants from Native American workforce agencies.

EXTENDING WELFARE-TO-WORK GRANTS. To help more long-term welfare recipients and low-income fathers go to work and support their families, the President's budget will give state, local, tribal, and community- and faith-based grantees an additional two years to spend Welfare-to-Work funds, ensuring that roughly $2 billion in existing resources continues to help those most in need. This will give grantees an opportunity to fully implement the $3 billion Welfare-to-Work initiative the President fought to include in the 1997 Balanced Budget Act, as well as the program eligibility improvements enacted last year with the Administration's support.

CHILD SUPPORT COLLECTIONS SET NEW RECORD, NEARLY DOUBLING SINCE 1992. The White House today will also announce new data showing that the Administration's child support campaign nearly doubled collections to $15.5 billion in FY 1999, up from $8 billion in 1992. A record $1.3 billion of these collections came from withholding federal tax returns from deadbeat parents, with the balance coming from a variety of stronger enforcement tools put in place since 1992, allowing garnishing of wages, seizing of bank accounts, and taking of drivers and other licenses. The new data show that efforts to track deadbeat parents across state lines are working -- 2.8 million parents were located in the first two years of operation of the National Directory of New Hires, which matches child support orders to employment records. These statistics confirm promising trends, showing that paternity establishment -- often the first step in collecting child support -- tripled to nearly 1.5 million in 1998, and the number of child support cases with collections rose from 2.8 million in 1992 to 4.5 million in 1998.

NEW INITIATIVES ARE IMPORTANT NEXT STEP IN WELFARE REFORM. The initiative to be announced today is an important next step in welfare reform, which has moved millions of single parents (mainly mothers) into the workforce, and it is a logical extension of the existing Welfare-to-Work funds, which are helping long-term welfare recipients and low-income fathers work and support their families.

Three years after the enactment of the welfare reform law, we've seen revolutionary changes to promote work and responsibility. Numerous independent studies confirm that people are moving in record numbers from welfare to work; and welfare rolls are down by more than half since 1992 to their lowest level in 30 years. The 12,000 companies in the Welfare to Work Partnership launched by the President in 1997 have hired nearly 650,000 former welfare recipients. More than 1.3 million welfare recipients nationwide went to work in 1998 alone; the percentage of adults still on welfare who were working nearly quadrupled between 1992 and 1998, with all fifty states meeting the welfare reform law's overall work requirement. Today, there are 2.2 million fewer children living in poverty than in 1993, and the child poverty rate declined from 22.7 percent to 18.9 percent -- the largest five year drop in nearly 30 years. The overall poverty rate fell to 12.7 percent in 1998, with 4.8 million fewer people in poverty than in 1993.

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