Using Child-Support Payments to Actually Support Children

Wisconsin is righting a wrong that many state governments are complicit in perpetrating, but is largely due to federal policy. As the New York Times recently reported, child-support payments for children on welfare are being used in almost every state to recoup state and federal welfare expenses. When Congress created the child-support system 30 years ago, recouping welfare costs by siphoning off collected child-support payments was an explicit goal. Yet close to half the states pass along none of the collected child-support while most others pay only $50 per child, even when a non-custodial parent pays several hundred more. Research and experience shows that the policy of withholding payments to recoup state costs discourages non-custodial parents from paying child-support and makes families more dependent on aid. 

In Wisconsin, a federal waiver allowed the state to forward all money collected to families. As a result, more non-custodial parents came forward and paid more of the money they owed, making families less reliant on aid and making up for any short-term loss of government revenue spent on welfare. However, the Bush Administration refused to extend the Wisconsin waiver but the state is keeping its end of the bargain with families. Despite a $27 million cut in federal aid, Wisconsin will continue to forward its entire share of money collected to families.

The previous Congress has a mixed record in trying to see more child-support payments get to the children who deserve them. While the 2006 Deficit Reduction Act will allow states to send $100 for one child beginning in 2009, up from $50, Congress and the Bush Administration also reduced funding for child-support enforcement. States say this will impede enforcement and prevent them from passing on more money to needy families.

At the end of the day, diverting child-support payments from the children they are intended for is a cynical way to recoup welfare expenses and is shown to drive non-custodial parents underground and keep families dependent on welfare.  Wisconsin, by putting up more state money to ensure children get the money they are owed, is taking an important stand that other states and particularly the federal government, which sets these rules, can learn from.