Revision of the Effective Date of Regulation 45 CFR 304.21; FFP in the Costs of Cooperative Agreements

ACTION TRANSMITTAL

OCSE-AT-79-09

DATE: October 29, 1979

TO: STATE AGENCIES ADMINISTERING CHILD SUPPORT ENFORCEMENT PLANS APPROVED UNDER TITLE IV-D OF THE SOCIAL SECURITY ACT AND OTHER INTERESTED INDIVIDUALS

SUBJECT: Revision of the effective date of regulation 45 CFR 304.21; Federal Financial Participation in the Costs of Cooperative Agreements with Courts and Law Enforcement Officials.

ATTACHMENT: Amendment to the effective date of 45 CFR 304.21, as amended, to make it retroactive to July 1, 1975 (see below)

REGULATION REFERENCE:45 CFR 304.21 (See OCSE-AT-78-11 dated August 8, 1978)

EFFECTIVE DATE: Immediately

INQUIRIES TO: OCSE Regional Representatives

Deputy Director
Office of Child Support Enforcement

Office of Child Support Enforcement

45 CFR Part 304

Federal Financial Participation in the Cost of Cooperative Agreements With Courts and Law Enforcement Officials

AGENCY: Office of Child Support, Enforcement (OCSE).

ACTION: Amendment of effective date.

SUMMARY: On July 31, 1978, OCSE published a final regulation (43 FR 33249), effective that day which provided Federal financial participation (FFP) for the non-salary costs of child support enforcement activities performed by courts or court related agencies (45 CFR 304.21). This document changes the effective date of that regulation to make it retroactive to July 1, 1975, which will allow OCSE to reimburse States for the administrative costs of courts incurred during the 3 year period from July 1, 1975, the beginning of the IV-D program, to July 31, 1978.

DATES: 45 CFR 304.21 as amended July 31, 1978, is effective retroactive to July 1, 1975.

FOR FURTHER INFORMATION CONTACT: Steven Henigson, Office of Child Support Enforcement, 6110 Executive Blvd., Room 900, Rockville, MD. 20115, telephone: (301) 443-5301.

SUPPLEMENTARY INFORMATION: The July 31, 1978 regulation liberalized the Federal policy on the availability of Federal financial participation (FFP) for the costs of court activities incurred on behalf of the child support enforcement program (IV-D program). From the inception of the program, July 1, 1975, until July 31, 1978, FFP was available only for the costs of compensating court employees (other than judges) who were performing child support enforcement activities. FFP was not available for any administrative costs incurred by courts in carrying out child support enforcement activities, such as office space, furniture, computer services, etc.

On March 15, 1979, the United States District Court for the Western District of Missouri, Central Division, in the case of Reser v. California ruled that the regulation that prohibited Federal reimbursement of the non-salary administrative costs of courts prior to July 31, 1978, was invalid because it was not reasonably related to the purposes of the Child Support Enforcement program and as such was not within the regulatory authority of the Secretary. As part of the deliberations within the Department to determine whether the Reser case should be appealed, a complete review of this policy was undertaken.

The Department has now determined that the July 31, 1978 change in reimbursement policy should be applied retroactively to the beginning of the program, thereby avoiding the inconsistent policy of reimbursing nonsalary costs of courts or court administered agencies incurred after July 31, 1978 but not before.

The Department's policy of denying FFP for the non-salary court administrative costs before July 31, 1978, is currently under challenge by a number of States that are seeking administrative review of disallowed costs incurred during the period July 1, 1975 to July 31, 1978. Other States are currently suing the Department in an effort to obtain reimbursement for costs they incurred during that period. This amendment will enable the Department to reverse its previous disallowances and reimburse State claims that are otherwise valid.

This document changes the effective date of the regulation, as amended (45 CFR 304.21) from July 31, 1978 to July 1, 1975. This change does not affect other provisions or prohibitions contained in the regulation. FFP is still not available for the costs of judicial determinations, including compensation for judges and other court personnel, and related administrative costs.

Consistent with the Administrative Procedure Act, the Department finds that public notice and comment is unnecessary with respect to this change. This amendment removes an inconsistency in the treatment of States' claims for FFP based on the time period during which the expenditures were incurred. This regulation will benefit those States that incurred expenditures under the IV-D program for the administrative costs of courts or court related agencies prior to July 31, 1978. This change in no way affects the rights of individuals in the IV-D program. This change merely makes retroactive a liberalization in policy regarding Federal reimbursement. In addition, this change is effective immediately upon publication because it relieves a restraint on the availability of Federal funding.

45 CFR 304.21, as amended July 31, 1978 is hereby made effective retroactive to July 31, 1975.

(Sec. 1102 of the Social Security Act. 49 Stat. 647 (42 U.S.C. 1302)) (Catalog of Federal Domestic Assistance Program No. 13.679 Child Support Enforcement program)

Note. The Office of Child Support Enforcement has determined that this document does not require preparation of Regulatory Analysis as described by Executive Order 12044.

Dated: September 26, 1979.

Stanford G. Ross
Director, Office of Child Support Enforcement.

Approved: September 27, 1979.

Patricia Roberts Harris
Secretary.