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The Honolulu Advertiser

Posted on: Sunday, April 10, 2005

Despite 2002 court case, state still has problems delivering payments

 •  Hawai'i at bottom in child-support ranking
 •  Error stymies dad's efforts to pay

By Jim Dooley
Advertiser Staff Writer

The state continues to have problems delivering large amounts of delinquent child-support payments to families, even though a 2002 court case forced officials to work harder to distribute more than $3 million in uncashed checks and returned checks sent to wrong addresses.

According to the latest available federal statistics, the state held $7.6 million in undistributed accounts by the end of September 2003. Newer numbers, which haven't been federally audited, place the 2004 total at $4.6 million, according to Attorney General Mark Bennett. He noted that much of the money in the account was there only briefly before being disbursed to parents.

State child-support enforcement officials say at least some portion of the child-support payments from delinquent parents cannot be delivered because the recipient families may have moved and can't be found.

In some cases, the state never gets word to parents that they are no longer obligated to keep sending checks because the Child Support Enforcement Agency has lost contact with the children who are supposed to receive the money, officials and child-support caseworkers said.

Arnold Enoki

Sabrina McKenna

Arnold Enoki, Child Support Enforcement Agency administrator, said that when such payments are received, they go into "undistributed collections" accounts, which were the subject of a 1998 lawsuit filed against the agency.

The lawsuit alleged that the agency had failed to make timely disbursements of more than $7 million in child-support payments and used the money as a "slush fund." The state denied the slush-fund charge and disputed the $7 million figure as grossly inflated.

In mid-2002, Circuit Judge Sabrina McKenna ruled that the Child Support Enforcement Agency held more than $3 million in its accounts because checks it had issued had never been cashed or had been returned because they were sent to "bad addresses."

"Although the CSEA has been aware of the problem of outstanding and uncashed checks for years, it has not attempted to rectify the situation," McKenna ruled.

She also said evidence in the case "indicated that Arnold Enoki, administrator of the CSEA, has been knowingly submitting (federal) forms containing completely inaccurate information regarding 'undistributed collections' to the federal government while certifying that the information is true to the best of his knowledge and belief."

The state appealed McKenna's ruling as legally and factually faulty but did step up its efforts to locate or notify custodial parents who had money coming to them. As a result, the state returned millions of dollars to thousands of parents, according to papers filed in the appeal. The case is still pending before the Hawai'i Supreme Court.

Included in the appeal is the question of whether the state should comply with McKenna's order to pay the attorneys who filed the suit $500,000 in fees and expenses.

In a 2003 ruling that the state should pay the private attorneys, McKenna said they worked for "five years to pursue a novel, complicated and difficult case with no assurance that they would receive one penny of compensation for their efforts."

Undistributed payments are a nationwide problem, totaling around $532 million. Last year, the U.S. Government Accounting Office studied the issue and found that much of the money was on hold because state agencies' computers had incomplete data and because custodial parents couldn't be found.

Bennett said of the $4.6 million in undistributed amounts as of the end of December, $1.1 million was in the category of "held pending the location of the custodial or noncustodial parent."

About the same amount of money has been in the account for six months to five years, but no funds have been held longer than that, according to CSEA records.

Reach Jim Dooley at 535-2447 or jdooley@honoluluadvertiser.com.