Colorado Legislative Council Staff

STATE

REVISED FISCAL IMPACT

(replaces fiscal impact dated March 29, 1999)

TITLE:            CONCERNING SUPPORT OBLIGATIONS.

Summary of Legislation

            The reengrossed bill includes a number of provisions regarding support obligations. Section 13-32-101 (1) of the bill extends court collection of processing fees for alimony and support payments and the Support Registry Fund until January 1, 2001 (current law would repeal court collection of processing fees for alimony and support payments October 1, 1999).

            The bill addresses maintenance obligations relative to the Family Support Registry accordingly:

            •   if the court orders maintenance payments to be paid through the Family Support Registry, and if the executive director of DHS has notified the state court administrator that the judicial district in which the court issuing the order is situated is ready to participate in the Family Support Registry and the Family Support Registry is ready to accept such maintenance payments, such payments shall be processed through the Family Support Registry;

            •   requires the party, when the court directs maintenance payments through the Family Support Registry, to pay a minimal per transaction processing fee, to be determined by the executive director of DHS, to cover the direct and indirect costs associated with processing the maintenance payment; and

            •   requires the processing fee to paid each time a maintenance payment is made through the Family Support Registry.

            The bill includes several effective dates:

            •   the act is effective July 1, 1999, except Section 8 — effective January 1, 2000;

            •   Sections 4 and 5 shall apply to orders entered on or after July 1, 1999;

            •   Section 9 shall apply to orders entered before, on, or after July 1, 1999; and

            •   Section 10 shall apply to orders entered or modified on or after July 1, 1999.

State Revenues

            Section 13-32-101, C.R.S. — current law provides that fees collected for the direct and indirect costs of processing and distributing support payments are required to be paid through the court registry and credited to the Support Registry Fund. Moneys in the fund shall be subject to annual appropriation by the General Assembly. Because the bill extends through December 31, 2000, a program currently appropriated on an annual basis, there is no net increase or decrease in either revenues or expenditures relative to this section of the bill for FY 1999-00. SB 99-215 includes an appropriation for "Alimony and Support" of $100,000 cash funds for FY 1999-00.

            For FY 2000-01, the courts will stop collecting processing fees for alimony and support payments effective January 1, 2001, the last six months of the fiscal year. The Judicial Branch indicates it does not have the data to identify the number of maintenance-only cases it processes annually. Thus, the decrease in revenues collected by Judicial cannot be quantified at this time. [Additionally, the Family Support Registry will phase in the processing of maintenance-only cases, beginning July 1, 2000.]

            Section 26-13-114 (13), of the bill — provides that the executive director of DHS will establish the maintenance payment transaction processing fees (to cover the direct and indirect cost of processing the maintenance payment) to be paid by parties ordered by the court to make maintenance payments through the Family Support Registry.

            Although the Judicial Branch cannot provide data on the number of maintenance-only cases it processes annually, the Family Support Registry indicates that 1 percent of the IV-D child support cases it processes include maintenance payments. The Family Support Registry processes 309,000 payments annually — 1 percent of 309,000 = 3,090 child support plus maintenance payments. The Family Support Registry estimates that the total of maintenance-only cases will not be greater than the IV-D cases which include child support and maintenance.

            DHS indicates that it will begin to process maintenance-only payments effective July 1, 2000, with a phased-in approach. The average transaction cost is identified at $5.66. Because federal financial participation will not be available for maintenance-only cases, it is estimated that $17,489 in fees will need to be collected in FY 2000-01 to offset the direct and indirect cost of processing these cases (3,090 x $5.66/transaction = $17,489).

State Expenditures

            Section 26-13-114 (1) (c), of the bill — the fiscal impact of processing maintenance payments through the Family Support Registry is estimated at $17,489 and is based on processing 3,090 cases at $5.66 per transaction annually. [See State Revenues section above.]

            Although the Judicial Branch cannot currently identify the number of maintenance-only cases it processes annually, the fiscal note assumes that any reduction in expenditures associated with maintenance-only cases will be addressed through the annual budget process.

Departments Contacted

            Human Services

            Judicial