No. 31159 (New Rule): R527-920. Mandatory Disbursement to Obligee through Electronic Funds Transfer

DAR File No.: 31159
Filed: 04/18/2008, 12:10
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this rule is to outline the procedures for establishing electronic funds transfers to obligees and to specify appropriate exceptions to the requirement for Office of Recovery Services/Child Support Services (ORS/CSS) to make distributions by electronic funds transfer as allowed in Section 62A-11-704.

Summary of the rule or change:

Section R527-920-1 includes the legal authority for rulemaking that has been granted to ORS/CSS and a statement describing the purpose of this specific rule. Section R527-920-2 outlines the procedures that ORS/CSS will follow to notify obligees of the options available for receiving payments by electronic funds transfer and to allow obligees the chance to select from the available options. Section R527-920-3 lists the exceptions to receiving payments by electronic funds transfer, as specified in Subsection 62A-11-704(3).

State statutory or constitutional authorization for this rule:

Sections 62A-1-111, 62A-11-107, and 62A-11-704

Anticipated cost or savings to:

the state budget:

Anticipated savings to be realized through required electronic funds transfers were detailed in the fiscal note attached to H.B. 265 passed by the Utah State Legislature in the 2008 General Session. There are some anticipated costs related to implementing this clarifying rule as a result of providing written notification of the electronic funds transfer options as follows: Providing a mass mailing to eligible clients upon implementation of Section 62A-11-704: ORS/CSS plans to send approximately 20,000 letters to eligible clients as Section 62A-11-704 is implemented. The cost for each letter, printing and postage, will be $0.35, totaling an estimated $7,000 for this initial mass mailing. Providing written notification of options at the time a case is opened: No additional cost. Other documents are already sent to the applicant at this time, so adding the electronic funds transfer notification to the other documents will not represent an additional cost. Providing written notification of options at the time of first-time order establishment: No additional cost. Other documents are already sent to the obligee at this time, so including the electronic funds transfer notification will not represent an additional cost. Providing written notification of options to previously-enrolled obligees when a previously - established account is no longer available: The exact cost is not predictable because it will depend on the number of obligees who request ORS/CSS to change the account that is being used for electronic funds transfers. If the obligee can provide the new account information at the time of the request, the cost will be zero since the accounting office can simply make the changes without providing the written notification. If the obligee cannot provide the new account information, the cost will be postage for a two-page notice to be mailed to that obligee requesting the new account information. Providing written notification of options when ORS/CSS no longer offers a particular electronic funds transfer option: The cost is not predictable at this point, as it will depend on the number of obligees affected by any potential change of available option. For each affected obligee, the cost would be that of a mass-mailing, meaning the postage costs for a two page document providing the new available options. For each response received, there is a small personnel cost involved with establishing each account for electronic funds transfers that was not addressed in fiscal note attached to H.B. 265. It is not possible to accurately predict the number of responses that will be received, but past experience indicates we can expect a 15-20% response rate. Processing costs per request vary based on the method of payment selected as follows: Direct Deposit request: $10.54 per request (20 minutes per request x $31.64 average hourly wage and benefit package) EPPICard request $5.27 per request (10 minutes per request x $31.64 average hourly wage and benefit package). (DAR NOTE: H.B. 265 (2008) is found at Chapter 73, Laws of Utah 2008, and was effective 05/05/2008.)

local governments:

Administrative rules of the ORS/CSS do not apply to local government; therefore, there are no anticipated costs or savings for any local government due to this rule.

small businesses and persons other than businesses:

The procedures contained in this rule do not affect small businesses; therefore, there are no anticipated costs or savings for small businesses due to this rule. The provisions outlined in this proposed rule will affect obligee parents who have not previously enrolled in electronic funds transfers with ORS/CSS. For each of these obligees, the anticipated cost is for postage at $0.41 to return the form indicating his/her preferred method for receiving electronic payments. There are minimal fees associated with the selection of EPPICard as the method of receiving payments, but those fees are related to specific types of financial transactions (such as balance checks at an ATM) which are not required for successful use of the card or access to the funds deposited there. Those fees are outlined in the written notice of electronic funds transfer options, and all fees can be completely avoided by selecting Direct Deposit as the method for receiving electronic funds transfers. Use of electronic funds transfers will represent an aggregate savings to obligee parents in the form of saved fuel as they will no longer have to deposit or cash a paper check at their financial institutions; however, the amounts of this savings per parent are highly variable and cannot be estimated.

Compliance costs for affected persons:

The provisions outlined in this proposed rule will affect obligee parents who have not previously enrolled in electronic funds transfers with ORS/CSS. For each of these obligees, the anticipated cost is for postage at $0.41 to return the form indicating his/her preferred method for receiving electronic payments. There are minimal fees associated with the selection of EPPICard as the method of receiving payments, but those fees are related to specific types of financial transactions (such as balance checks at an ATM) which are not required for successful use of the card or access to the funds deposited there. Those fees are outlined in the written notice of electronic funds transfer options, and all fees can be completely avoided by selecting Direct Deposit as the method for receiving electronic funds transfers. There are no other anticipated compliance costs for affected persons.

Comments by the department head on the fiscal impact the rule may have on businesses:

Businesses are not addressed in the proposed rule and it is not anticipated the rule will create any fiscal impact on them. Lisa-Michele Church, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Human Services
Recovery Services
515 E 100 S
SALT LAKE CITY UT 84102-4211

Direct questions regarding this rule to:

Liesa Corbridge at the above address, by phone at 801-536-8986, by FAX at 801-536-8833, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

06/16/2008

This rule may become effective on:

06/23/2008

Authorized by:

Mark Brasher, Director

RULE TEXT

R527. Human Services, Recovery Services.

R527-920. Mandatory Disbursement to Obligee Through Electronic Funds Transfer.

R527-920-1. Authority and Purpose.

(1) Section 62A-11-107 authorizes the Office of Recovery Services/Child Support Services (ORS/CSS) to adopt, amend and enforce rules. Section 62A-11-704 authorizes ORS/CSS to make rules to allow exceptions to mandatory disbursements by electronic funds transfer.

(2) The purpose of this rule is to outline the procedures for establishing electronic funds transfers to obligees and to specify appropriate exceptions to the requirement for ORS/CSS to make disbursements by electronic funds transfer as allowed in Section 62A-11-704.

 

R527-920-2. Procedures.

(1) ORS/CSS will notify obligees that have enforceable support orders of the available options for receiving electronic funds transfers. Written information about electronic funds transfer options will be sent to the best available addresses for eligible obligees.

(2) Written information about electronic funds transfer options will be sent at the following points in time if an obligee has not already arranged for electronic funds transfers:

(a) When Section 62A-11-704, mandating disbursement through electronic funds transfers, is implemented by ORS/CSS;

(b) When a new case is opened with ORS/CSS that is accompanied by an enforceable support order;

(c) When a first-time support order is established for an open case with ORS/CSS;

(d) When an established account for receiving electronic funds transfers is no longer appropriate for future transfers; or,

(e) When a previously-selected method for receiving electronic funds transfers will no longer be offered by ORS/CSS.

(3) Written information about electronic funds transfer options will be sent to obligees that have previously enrolled in this service in the following situations:

(a) When a previously-established account for receiving electronic funds transfers is no longer available to the obligee for future transfers; or,

(b) When a previously-selected method for receiving electronic funds transfers will no longer be offered by ORS/CSS.

(4) Upon receiving the written information about electronic funds transfer options, each obligee will be allowed to select from the available options and return the form to ORS/CSS to indicate his or her preferred method for receiving electronic payments. If an obligee fails to indicate a preference or fails to provide the necessary information to establish the preferred method of electronic funds transfer within sixty days of the date on the written notice, ORS/CSS has the option of enrolling that obligee in a plan to receive payments in an account that may be accessed through the use of an electronic access card.

(5) Payments will be disbursed by paper checks while the method of electronic funds transfer is established.

 

R527-920-3. Exceptions.

(1) Exceptions to mandatory disbursements through electronic funds transfer are allowed as follows:

(a) For a period of no more than 60 days after a case is opened with an enforceable support order;

(b) For a period of no more than 60 days after a first-time support order is established;

(c) For a period of no more than 60 days while an obligee changes the account to be used for receiving future electronic funds transfers; or,

(d) For an indefinite time period if an obligee resides in a foreign country and an electronic funds transfer cannot be facilitated;

(2) The ORS or ORS/CSS Director may approve additional exceptions to mandatory disbursements through electronic funds transfers on a case-by-case basis if the obligee presents a request in writing and can demonstrate that electronic funds transfers would result in an undue hardship to that obligee. The ORS or ORS/CSS Director will determine the duration of the exception based on the individual circumstances.

(3) Disbursements through electronic funds transfer will not be mandatory for ORS/CSS if technical problems prevent successful electronic disbursement within the federally-mandated disbursement time frames found in 45 CFR 302.32.

 

KEY: electronic funds transfer, child support

Date of Enactment or Last Substantive Amendment: 2008

Authorizing, and Implemented or Interpreted Law: 62A-1-111; 62A-11-107; 62A-11-704