Child Support Enforcement Program: Paternity Establishment and Revision of Child Support Enforcement Program and Audit Regulations

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Administration for Children and Families

45 CFR Parts 301, 302, 303, 304 and 305

RIN-0970-AB40

Child Support Enforcement Program: Paternity Establishment and

Revision of Child Support Enforcement Program and Audit Regulations

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

ACTION: Final rule.

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SUMMARY: This final rule contains provisions regarding both paternity

establishment and the audit. The paternity establishment provisions

implement the requirements of section 13721 of the Omnibus Budget

Reconciliation Act of 1993 (OBRA '93) signed by the President on August

10, 1993, which amends title IV-D of the Social Security Act (the Act).

These provisions require States to adopt procedures for a simple civil

process for the voluntary acknowledgment of paternity, including early

paternity establishment programs in hospitals. For paternity cases that

remain contested, the statutory provisions require States to adopt a

variety of procedures designed to streamline the paternity

establishment process. These include the use of default orders, a

presumption of paternity based on genetic test results, conditions for

admission of genetic test results as evidence, and expedited decision-

making processes for paternity cases in which title IV-D services are

being provided.

In addition, this final regulation amends the Child Support

Enforcement program regulations governing the audit of State Child

Support Enforcement (IV-D) programs and the imposition of financial

penalties for failure to substantially comply with the requirements of

title IV-D of the Act. This regulation specifies how audits will

evaluate State compliance with the requirements set forth in title IV-D

of the Act and Federal regulations, including requirements resulting

from the Family Support Act of 1988 and section 13721 of OBRA '93. This

final regulation also redefines substantial compliance to place greater

focus on performance and streamlines Part 305 by removing unnecessary

sections.

EFFECTIVE DATE: December 23, 1994. For applicability provisions, see

Supplementary Information Section.

FOR FURTHER INFORMATION CONTACT: Policy Branch, OCSE, specifically:

Andrew Williams, (202) 401-1467 regarding paternity establishment

provisions; Marilyn R. Cohen, (202) 401-5366 regarding expedited

processes; and Lourdes Henry, (202) 401-5440 regarding the audit

regulations.

SUPPLEMENTARY INFORMATION:

Applicability Provisions

1. Paternity Establishment Provisions. The paternity establishment

provisions of these regulations are applicable on and after December

23, 1994, or the statutory effective date as described below, whichever

occurs later. The Federal law provides that the statutory requirements

are effective on the later of: (1) October 1, 1993, or (2) enactment by

the State legislature of all required laws necessary to conform to the

requirements. However, in no event shall the statutory requirements be

effective later than the first day of the first calendar quarter

beginning after the close of the first regular session of the State

legislature that begins after August 10, 1993. In the case of a State

that has a two-year legislative session, each year of such session

shall be deemed to be a separate regular session of the State

legislature.

2. Audit Provisions. The audit provisions of these regulations are

applicable for audits conducted for periods beginning on or after

December 23, 1994.

Paperwork Reduction Act

The information collection requirement regarding submittal of the

State plan preprint page for the new paternity requirements was

approved by the Office of Management and Budget under OMB control

number 0970-0017. Otherwise, this rule does not require information

collection activities and, therefore, no additional approvals are

necessary under the Paperwork Reduction Act.

Statutory Authority

1. Paternity Establishment Provisions. This final rule is published

under the authority of section 466(a) of the Social Security Act (the

Act), as amended by the Omnibus Budget Reconciliation Act of 1993 (OBRA

'93) (Pub. L. 103-66). Section 466(a)(2), as amended, eliminates the

State option for including paternity establishment in expedited

processes, thereby requiring States to include paternity establishment

in expedited processes. Subsection 466(a)(5)(C) requires States to have

laws and procedures for a simple civil process for voluntarily

acknowledging paternity under which the State must provide that the

rights and responsibilities of acknowledging paternity are explained

and ensure that due process safeguards are afforded. Such procedures

must include a hospital-based program for the voluntary acknowledgment

of paternity during the period immediately before or after the birth of

a child. Subsection 466(a)(5)(D) requires States to have laws and

procedures under which the voluntary acknowledgment of paternity

creates a rebuttable, or at the option of the State, conclusive

presumption of paternity, and under which such voluntary acknowledgment

is admissible as evidence of paternity. Subsection 466(a)(5)(E)

requires States to have laws and procedures under which the voluntary

acknowledgment of paternity must be recognized as a basis for seeking a

support order without requiring any further proceedings to establish

paternity.

Subsection 466(a)(5)(F) requires States to have laws and procedures

which provide that (i) any objection to genetic test results must be

made in writing within a specified number of days before any hearing at

which such results may be introduced into evidence, and (ii) if no

objection is made, the test results are admissible as evidence of

paternity without the need for foundation testimony or other proof of

authenticity or accuracy. Subsection 466(a)(5)(G) requires States to

have laws and procedures which create a rebuttable or, at the option of

the State, conclusive presumption of paternity upon genetic testing

results indicating a threshold probability of the alleged father being

the father of the child.

Subsection 466(a)(5)(H) requires States to have laws and procedures

requiring a default order to be entered in a paternity case upon a

showing of service of process on the defendant and any additional

showing required by State law. Section 466(a)(11) requires States to

have laws and procedures under which the State must give full faith and

credit to a determination of paternity made by any other State, whether

established through voluntary acknowledgment or through administrative

or judicial processes. These final regulations are also published under

the general authority of section 1102 of the Act, which requires the

Secretary to publish regulations that may be necessary for the

efficient administration of the functions for which she is responsible

under the Act.

2. Audit Provisions. This final regulation is published under the

authority of sections 1102, 402(a)(27), 452(a)(4), and 403(h) of the

Act. Section 1102 authorizes the Secretary to publish regulations not

inconsistent with the Act which may be necessary to efficiently

administer the Secretary's functions under the Act. Section 402(a)(27)

requires each State to operate a child support program in substantial

compliance with the title IV-D State plan. Section 452(a)(4) requires

an audit of each State IV-D program to assure compliance with title IV-

D requirements at least once every three years (or not less often than

annually in the case of any State which is being penalized, or is

operating under a corrective action plan). Finally, section 403(h)

provides for the imposition of an audit penalty of not less than 1 nor

more than 5 percent of a State's AFDC funding for any State which fails

to substantially comply with title IV-D requirements within the period

of time the Secretary determines to be appropriate for corrective

action.

Background

This final rule contains regulations that: (1) Implement the

paternity establishment provisions of OBRA '93, and (2) revise the

child support enforcement audit regulations. The proposed audit rule

was published September 9, 1993 (58 FR 47417), and the proposed

paternity rule on November 29, 1993 (58 FR 62599), each with 60-day

public comment periods. These two proposed regulations overlapped in

some areas. In particular, the ``credit for providing services''

portion of the proposed audit regulation was affected by changes to

expedited process requirements made by the proposed paternity

regulation. Furthermore, changes to paternity establishment

requirements made by the proposed paternity regulation impacted which

paternity requirements would be audited under the audit regulation.

Because the two proposed regulations were at similar stages of the

regulatory process and because they overlapped in certain areas, we

decided to combine them in this final regulation.

1. Paternity Establishment Provisions. Paternity establishment is a

necessary first step in the child support enforcement process in cases

where a child is born out-of-wedlock. In addition to child support,

paternity establishment may result in other financial benefits for the

child, including Social Security dependents' benefits, pension

benefits, veterans' benefits, and possible rights of inheritance.

Furthermore, paternity establishment may give children social and

psychological advantages and a sense of family heritage, be a first

step in creating a psychological and social bond between father and

child, and provide important medical history information.

The Federal government has long recognized the importance of

paternity establishment. In 1975, by enactment of Title IV-D of the

Social Security Act, Congress required States to establish public child

support enforcement agencies and to provide paternity establishment

services. The Child Support Enforcement Amendments of 1984 (Pub. L. 98-

378) required States to permit paternity to be established until a

child's 18th birthday. The Family Support Act of 1988 (Pub. L. 100-485)

contained several provisions designed to improve paternity

establishment: A performance standard, timeframes for case processing,

enhanced funding (90 percent Federal financial participation) for

genetic testing, a requirement that States compel all parties in a

contested paternity case to submit to genetic testing upon the request

of a party, a requirement that States compel each parent to provide his

or her social security number as part of the birth certificate issuance

process, and a clarification of the expansion of the requirement

permitting paternity establishment to 18 years of age.

Partly as a result of these Federal efforts, the number of

paternities established each year by the IV-D program has increased

substantially from about 270,000 in FY 1987 to more than 553,000 in FY

1993--an increase of over 100 percent in just six years. However, the

percentage of children born out-of-wedlock also continues to increase.

In 1991, almost 30 percent of American children, over 1.2 million

children, were born to unmarried mothers. Currently, as reported by

State agencies, paternity is only established for about one-sixth of

the children who need it per year. Even in cases where paternity is

established, the process is often lengthy and adversarial in nature.

Therefore, the President and Congress decided to further reform the

system through changes to title IV-D in the OBRA '93. The

Administration proposed the new paternity requirements as an initial

step in the President's efforts to improve the child support

enforcement program. While this rule is based on existing law, it

serves as a foundation for additional reforms proposed by the

President's Welfare Reform bill.

The amended statute and these implementing regulations are intended

to increase both the number of paternities established for children

born out-of-wedlock and the timeliness with which paternity

establishment is accomplished. In particular, these provisions will

increase the number of paternities established by voluntary

acknowledgment. However, some cases will remain contested, and these

reforms should expedite the process for resolving those cases as well.

Many of these reforms are based on innovative State practices and

recommendations of the U.S. Commission on Interstate Child Support.

Congress created the Interstate Commission as part of the Family

Support Act of 1988 to recommend ways of improving the interstate

establishment and enforcement of child support awards. In 1992, the

Commission issued its comprehensive final report to the Congress which

contained numerous recommendations, including recommendations for

improving paternity establishment in both interstate and intrastate

cases.

Because Congress added the newly-mandated practices to section

466(a) of the Act, they are requirements which States must meet as a

condition of State plan approval under section 454(20) of the Act.

These regulations add the new State plan requirements to 45 CFR 302.70.

Each State's title IV-D plan must be approved for the State to receive

Federal financial participation in the operation of its Child Support

Enforcement program.

2. Audit Provisions. As a result of the enactment of the Child

Support Enforcement Amendments of 1984, OCSE published final audit

regulations on October 1, 1985, which governed the audits of State IV-D

programs beginning in FY 1984. Section 452(a)(4) of the Act and

implementing regulations require that OCSE conduct audits of the

effectiveness of State Child Support Enforcement programs at least once

every three years; specify that OCSE use a substantial compliance

standard to determine whether each State has an effective IV-D program;

provide that any State found not to have an effective IV-D program in

substantial compliance with the requirements of title IV-D of the Act

be given an opportunity to submit a corrective action plan and, upon

approval by OCSE, to take the corrective action necessary to achieve

substantial compliance with those requirements; provide for the use of

a graduated penalty of not less than 1 nor more than 5 percent of the

Federal share of a State's Aid to Families with Dependent Children

(AFDC) program funds if a State is not in substantial compliance; and

specify the period of time during which a penalty is effective.

On August 4, 1989, a final rule, Standards for Program Operations,

was published (54 FR 32284) to implement the requirements of sections

121 and 122 of the Family Support Act. Specifically, this final rule

revised 45 CFR parts 302 and 303 to specify standards for processing

child support enforcement cases and timeframes for distributing child

support collections under title IV-D of the Act. States were required

to meet these standards beginning October 1, 1990.

With regard to other Family Support Act requirements, on May 15,

1991, a final rule was published which implemented the requirements

governing $50 pass-through payments, guidelines for setting child

support awards, mandatory genetic testing, paternity establishment and

laboratory testing (56 FR 22335). The requirements governing immediate

wage withholding, review and adjustment of support obligations and

monthly notice of support collections were published on July 10, 1992

(57 FR 30658). A final rule was published on November 19, 1992 (57 FR

54515) to clarify timeframes for processing child support collections.

Additional review and adjustment requirements were published December

28, 1992 (57 FR 61559).

As a result of the passage of time, the child support provisions of

the Family Support Act and OBRA '93, and the necessary changes to

program regulations, we reexamined the audit process and regulations

and developed this final regulation. In doing so, we considered the

impact of the new requirements on States and our experience with the

audit process to date. We considered comments received in response to

our notice of proposed rulemaking published September 9, 1993 (58 FR

47417).

Furthermore, we considered the concerns that many States and other

groups have expressed about the current audit process. First, there is

a concern that the scope, complexity, and length of the audit is

expanding. OCSE audits cover numerous criteria and sub-criteria. The

child support provisions of the Family Support Act of 1988 add to the

complexity of the support enforcement program, and hence the audit

process, by significantly expanding the number of criteria to be

reviewed. Partly as a result of this growing scope and complexity, it

takes an increasingly greater amount of time and effort to conduct

audits. This may cause delays in obtaining results and in performing

audits in other States. In addition, although service delivery is

already the primary focus of the audit (i.e., the 75 percent case

action standard), there is a concern that the audit should focus more

on outcomes and results. Focusing more on outcomes and results,

including the timeliness of providing services, would allow the audit

to better measure State program performance.

In response to concerns about the expanding scope of the audit, we

have redefined substantial compliance to focus on certain criteria: (1)

Service-related criteria that a significant number of States have

failed to comply with in the past; and (2) new or newly-revised

criteria. Eliminating certain administrative or procedural criteria and

focusing on service-related criteria to the extent possible will

produce a more results-oriented audit. The audit process is not the

sole means through which State program development and compliance is

determined. OCSE uses program reviews, the State plan approval process,

the program audit process, and the audit resolution and tracking system

to review and monitor State compliance and performance.

This final regulation also specifies how audits would evaluate

State compliance with the standards for program operations as well as

other requirements mandated by the Family Support Act of 1988 and

paternity establishment requirements of OBRA '93 by setting forth new

and revised audit criteria and processes. The rule combines related

requirements into groupings, and streamlines part 305 by removing

unnecessary sections. The requirements in this final regulation are

effective for audits conducted for periods beginning on or after

December 23, 1994.

Description of Regulatory Provisions

1. Paternity Establishment Provisions.

Required State Laws--Section 302.70(a)

Section 466(a) of the Act requires a State to have laws that

require the use of these new paternity procedures. Consistent with the

rules implementing the Family Support Act requirements, a State may

comply by issuing regulations, procedures, or court rules, instead of

enacting laws, if they have the same force and effect under State law

on the parties to whom they apply.

To simplify the regulatory language, we have deleted effective

dates of IV-D State plan requirements previously listed in

Sec. 302.70(a).

Simple Civil Process for Voluntarily Acknowledging Paternity--Sections

302.70(a)(5)(iii) and 303.5(a)

This rule implements the requirements of new section 466(a)(5)(C)

of the Act by amending Sec. 302.70(a)(5) to add new paragraph (iii).

This provision requires each State to have laws and procedures for a

simple civil process for voluntarily acknowledging paternity. Under

such process, the State must provide that the rights and

responsibilities of acknowledging paternity are explained and ensure

that due process safeguards are afforded.

The statute requires that the voluntary acknowledgment procedures

include hospital-based programs. However, because the statute includes

hospital-based programs as part of a broader requirement for voluntary

acknowledgment procedures, we believe Congress intended these

procedures to encompass more than just hospital-based programs.

Therefore, new Sec. 302.70(a)(5)(iii)(B) requires that the procedures

include a process for voluntarily acknowledging paternity outside of

hospitals.

IV-D Agency Activity. To reflect the newly-mandated procedures for

the voluntary acknowledgment of paternity, Sec. 303.5(a) requires, for

all cases referred to the IV-D agency or applying for services under

Sec. 302.33 in which paternity has not been established, the IV-D

agency must, as appropriate: (1) Provide an alleged father the

opportunity to voluntarily acknowledge paternity, in accordance with

Sec. 302.70(a)(5)(iii), and (2) attempt to establish paternity by legal

process under State law. (The IV-D agency is not required to take

additional action to establish paternity if, under State law, the

acknowledgment itself establishes paternity).

Hospital-Based Paternity Establishment Programs--Sections 301.1,

302.70(a)(5)(iii)(A), 303.5 (g) and (h), 304.20(b)(2), and 304.23(d)

In enacting OBRA '93, the President and Congress recognized the

importance of establishing a child's paternity as close to the time of

birth as possible, by requiring hospital-based programs for obtaining

voluntary acknowledgments. New Sec. 302.70(a)(5)(iii)(A) implements

section 466(a)(5)(C) of the Act by requiring each State to have laws,

regulations, and/or binding procedures for a hospital-based program for

the voluntary acknowledgment of paternity during the period immediately

before or after the birth of a child. At a minimum, new

Sec. 302.70(a)(5)(iii)(A) requires State law, regulation, and/or

binding procedure to compel all public and private birthing hospitals

to participate in hospital-based programs, as defined in

Sec. 303.5(g)(2). (However, under Sec. 302.70(d), a State may apply for

an exemption from enacting a law, regulation, or procedure providing

for a hospital-based program, if the State can assure that a hospital-

based program otherwise meeting Federal requirements is implemented in

every birthing hospital in the State by January 1, 1995 (or later if

Federal law governing the effective date allows) without the necessity

of enacting binding laws or regulations). We define ``birthing

hospital'' at Sec. 301.1 as a hospital that has an obstetric care unit

or that provides obstetric services, or a birthing center associated

with a hospital.

Section 303.5(g) describes the State's responsibilities in

implementing the hospital-based program. To accommodate divergent State

practices, the State as a whole, rather than the IV-D agency in

particular, is responsible for meeting the hospital-based program

requirements at Sec. 303.5(g). This approach in no way relieves the

State of the responsibility to meet Federal requirements as a condition

of IV-D State plan approval.

Section 303.5(g)(1) requires the State to establish, in cooperation

with hospitals, a hospital-based program in every public and private

birthing hospital. States must have laws, regulations, and/or binding

procedures in place on October 1, 1993 (or if legislation is required,

the beginning of the first calendar quarter after the close of the

first regular session of the State legislature that began after August

10, 1993). The programs must be operational in birthing hospitals

statewide no later than January 1, 1995 (unless Federal law governing

the effective date gives the State additional time; i.e., unless the

State's first regular legislative session beginning after August 10,

1993 precludes enactment by January 1, 1995).

Elements of a Hospital-Based Program. Section 303.5(g)(2) defines a

hospital-based program by listing the services and functions such a

program must, at a minimum, provide during the period immediately

before or after the birth of a child to an unmarried woman in the

hospital. These services are based on information provided by States

that previously implemented hospital-based programs. The State must

ensure, in cooperation with the hospitals, that the program performs

all of these functions.

Each hospital-based program must provide voluntary acknowledgment

services to unmarried mothers and alleged fathers. The program must

provide services regardless of the child's public assistance status or

whether an application has been filed for IV-D child support services.

Under Sec. 303.5(g)(2)(i), a hospital-based program provides to

both the mother and alleged father, if he is present in the hospital:

(A) Written materials about paternity establishment, (B) the forms

necessary to voluntarily acknowledge paternity, (C) a written

description of the rights and responsibilities of acknowledging

paternity, and (D) the opportunity to speak with staff, either by

telephone or in person, who are trained to clarify information and

answer questions about paternity establishment. In a case where the

alleged father is not present at the hospital, the hospital-based

program should provide to the unmarried mother the services described

in Sec. 303.5(g)(2)(i).

Under Sec. 303.5(g)(2)(ii), a hospital-based program provides the

unmarried mother and alleged father, if he is present, the opportunity

to voluntarily acknowledge paternity in the hospital. A hospital-based

program, under Sec. 303.5(g)(2)(iii), must afford due process

safeguards, as required by State law and procedure.

Under Sec. 303.5(g)(2)(iv), a hospital-based program must forward

completed acknowledgments or copies to the entity designated under

Sec. 303.5(g)(8). This will ensure that the IV-D agency has access to

and can use the acknowledgments in cases that become IV-D cases.

Under Sec. 303.5(g)(3), a hospital-based program need not provide

services related to acknowledging paternity in cases where the mother

or alleged father is a minor or a legal action (e.g., adoption) is

already pending, if provision of such services is precluded by State

law.

Under Sec. 303.5(g)(4), the State must require that a voluntary

acknowledgment obtained through a hospital-based program be signed by

both parents, and that the parents' signatures be authenticated by a

notary or witness(es).

Section 303.5(g)(5) requires the State to provide to all public and

private birthing hospitals in the State written materials about

paternity establishment, forms necessary to voluntarily acknowledge

paternity, and copies of a written description of the rights and

responsibilities of acknowledging paternity. Hospital-based programs

will then distribute these materials and forms to unmarried mothers and

alleged fathers in accordance with Sec. 303.5(g)(2)(i). While not a

requirement, States may also wish to provide applications for, and

materials relating to, IV-D services to hospitals for distribution to

maternity patients or other interested parties.

Section 303.5(g)(6) requires the State to provide staff training,

guidance, and written instructions regarding the voluntary

acknowledgment of paternity as necessary to operate the hospital-based

program. Section 303.5(g)(7) requires the State to assess each birthing

hospital's program on at least an annual basis.

Section Sec. 303.5(g)(8) requires the State to designate an entity

to which hospital-based programs must forward completed voluntary

acknowledgments or copies. Under State procedures, this entity must be

responsible for promptly recording identifying information about the

acknowledgments with a statewide database, and the IV-D agency must

have timely access to whatever identifying information and

documentation it needs to determine in accordance with Sec. 303.5(h) if

an acknowledgment has been recorded and to seek a support order on the

basis of a recorded acknowledgment in accordance with Sec. 303.4(f).

Under Sec. 303.5(h), in IV-D cases needing paternity establishment, the

IV-D agency must determine if identifying information about a voluntary

acknowledgment has been recorded in the statewide database, in

accordance with Sec. 303.5(g)(8).

FFP Availability for Hospital-Based Programs. This regulation

expands Federal financial participation (FFP) availability for certain

costs associated with hospital-based programs. Under

Sec. 304.20(b)(2)(vi), FFP is available for payments of up to $20 to

birthing hospitals and other entities that provide prenatal or birthing

services for each voluntary acknowledgment obtained pursuant to an

agreement with the IV-D agency. Section 304.20(b)(2)(vii) makes FFP

available for the costs of developing written and audiovisual materials

about paternity establishment and forms necessary to voluntarily

acknowledge paternity and providing such materials to birthing

hospitals and other entities that provide prenatal or birthing

services. Section 304.20(b)(2)(viii) makes FFP available for reasonable

and essential short-term training regarding voluntary acknowledgment of

paternity associated with a State's hospital-based program as defined

by Sec. 303.5(g)(2). This rule also modifies Sec. 304.23(d), which

limits the availability of FFP for training to specific circumstances,

to allow for FFP as provided for in Sec. 304.20(b)(2)(viii).

Effect of Voluntary Acknowledgment: Presumption of Paternity;

Admissible as Evidence--Section 302.70(a)(5)(iv)

This rule implements the requirements of section 466(a)(5)(D) of

the Act by adding Sec. 302.70(a)(5)(iv). This provision requires each

State to have laws and procedures under which the voluntary

acknowledgment of paternity creates a rebuttable or, at the option of

the State, conclusive presumption of paternity, and under which such

voluntary acknowledgment is admissible as evidence of paternity. It is

designed to ensure that voluntary acknowledgments are meaningful and

used to expedite paternity establishment in every State.

A rebuttable presumption shifts the burden of proof to the presumed

father to disprove a paternity allegation. A conclusive presumption has

the same effect as a judgment for paternity. Even if a State chooses to

adopt a conclusive presumption, it may provide for conditions under

which the presumption, like a judgment, can be challenged and

potentially overturned (e.g., in cases where there is evidence that the

acknowledgment was obtained by fraud or coercion, or where signatures

were forged).

Conditions for Admission of Genetic Test Results as Evidence--Section

302.70(a)(5)(v)

In recent years, scientific advancements in genetic testing have

revolutionized the paternity determination process in contested cases.

Genetic tests can not only produce exclusionary evidence eliminating a

man from consideration as the biological father, but can also provide

convincing evidence reflecting the high probability that a particular

man is the alleged father (inclusionary results), leaving little or no

doubt as to whether an alleged father is actually the biological

father. Statutory or case law in virtually all States provides that

genetic test results are admissible as evidence. However, in some

States, the process for admitting such evidence can be cumbersome.

Section 302.70(a)(5)(v), which implements section 466(a)(5)(F) of

the Act, should improve the process for admitting test results in legal

proceedings. It requires each State to have laws and procedures which

provide that any objection to genetic testing results must be made in

writing within a specified number of days before any hearing at which

such results may be introduced into evidence. Further, laws and

procedures must specify that if no objection is made, a written report

of the test results is admissible as evidence of paternity without the

need for foundation testimony or other proof of authenticity or

accuracy.

Presumption of Paternity Based on Genetic Test Results--Section

302.70(a)(5)(vi)

Section 466(a)(5)(G) of the Act and implementing regulation at

Sec. 302.70(a)(5)(vi) require each State to have laws and procedures

which create a rebuttable or, at the option of the State, conclusive

presumption of paternity based on genetic testing results which

indicate a threshold probability of the alleged father being the father

of the child. A presumption of paternity should expedite paternity

resolution.

Voluntary Acknowledgment Is Basis for Seeking Support Order--Sections

302.70(a)(5)(vii) and 303.4(f)

We are implementing section 466(a)(5)(E) of the Act by adding

Sec. 302.70(a)(5)(vii). This provision requires each State to have laws

and procedures under which a voluntary acknowledgment must be

recognized as a basis for seeking a support order without requiring any

further proceedings to establish paternity. As a result, filing a

petition seeking a support order and information-gathering necessary

for support order establishment should begin in a IV-D case as soon as

a voluntary acknowledgment is obtained. This should help ensure that

the child receives financial support at the earliest possible date.

To reflect that a voluntary acknowledgment must serve as sufficient

basis to seek establishment of a support order, we amended Sec. 303.4

by adding paragraph (f). Section 303.4(f) requires the IV-D agency, in

cases where a support order has not been established, to seek a support

order based on a voluntary acknowledgment in accordance with

Sec. 302.70(a)(5)(vii). Therefore, the IV-D agency must gather

information and establish support administratively, by consent, or by

filing a petition for support order establishment upon receipt of a

voluntary acknowledgment of paternity.

Default Orders--Sections 302.70(a)(5)(viii) and 303.5(f)

We have implemented the requirements of new section 466(a)(5)(H) of

the Act by adding Sec. 302.70(a)(5)(viii). Under this provision, each

State must have laws and procedures requiring that a default order be

entered in a paternity case upon a showing that process has been served

on the defendant in accordance with State law, that the defendant has

failed to respond to service in accordance with State procedures, and

any additional showing required by State law. State law must require,

not simply allow, tribunals, upon proper motion, to enter default

orders under these conditions.

To reflect the new default order requirement, we added

Sec. 303.5(f). It requires the IV-D agency to seek entry of a default

order by the court or administrative authority in a paternity case by

showing that process has been served on the defendant, that the

defendant has failed to respond to service in accordance with State

procedures, and any additional showing required by State law, in

accordance with Sec. 302.70(a)(5)(viii).

Full Faith and Credit for Paternity Determinations--Section

302.70(a)(11)

We implemented the requirements of section 466(a)(11) of the Act by

adding Sec. 302.70(a)(11). This provision requires each State to have

laws and procedures under which the State must give full faith and

credit to a determination of paternity made by any other State, whether

established through voluntary acknowledgment or through administrative

or judicial processes.

This provision should improve interstate processing since a State,

upon receiving a paternity determination made by another State, must

recognize such determination and move forward with the next step (e.g.,

support order establishment or enforcement) without questioning or

reopening the paternity issue.

Expedited Processes for Paternity Establishment--Sections 302.70(a)(2),

303.4(d), and 303.101

The Child Support Enforcement Amendments of 1984 (Pub. L. 98-378)

required States to have an expedited process within their judicial or

administrative systems for obtaining and enforcing child support

orders. At the option of the State, the expedited processes could also

include actions for establishment of paternity. Expedited process

timeframes, established by regulation, have been effective in prompting

States to adopt expedited administrative and quasi-judicial processes

for establishing and enforcing support orders. Prior to enactment of

OBRA '93, according to the IV-D State plans, 19 States had also opted

to extend expedited processes to paternity establishment. However, in

many jurisdictions the paternity establishment process, particularly in

contested cases, is still protracted.

To address this problem, OBRA '93 amended section 466(a)(2) of the

Act to mandate use of expedited processes for establishing paternity.

We have implemented this new provision by revising Sec. 302.70(a)(2) to

require each State to have laws and procedures for expedited processes

to establish paternity, in addition to the previously mandated

expedited processes for establishing and enforcing child support

orders.

As specified in section 466(a)(2) of the Act, expedited processes

are defined in Federal regulations. The provision of the Act regarding

expedited processes for support order establishment and enforcement was

previously implemented by Sec. 303.101. This rule amends these

regulations to require expedited processes for paternity establishment.

It also deletes Sec. 303.101(b)(3), which gave States the option of

including paternity establishment in their expedited processes, since

use of an expedited process for handling paternity cases is now

mandatory.

As with the expedited processes for support order establishment and

enforcement, under expedited paternity establishment processes both

intrastate and interstate cases must be included as required by

Sec. 303.101(b)(1).

Paternity and Support Establishment Timeframe. The regulatory

definition of expedited process is based on timeframes--States must

process IV-D cases within specified timeframes in order to be

determined to be operating an expedited process. Because OBRA '93

mandates the expansion of expedited processes to include paternity

establishment, and because the regulatory definition of expedited

process is based on timeframes, we reexamined previously-existing

expedited process and program standard timeframes.

Although paternity establishment was not included in expedited

process prior to enactment of OBRA '93, there were two timeframes

governing paternity establishment under standards for program

operations (see chart below). First, former Sec. 303.5(a)(1) was a

``front-end'' timeframe governing IV-D agency activity. It allowed the

IV-D agency 90 calendar days, from the date of locating the alleged

father, to file for paternity establishment or serve process (or

document unsuccessful efforts), whichever occurred later in accordance

with State procedures. Second, former Sec. 303.5(a)(2) was a ``back-

end'' timeframe governing court or administrative agency activity. It

allowed one year, from successful service of process or the child

becoming six months of age, to establish paternity or exclude the

alleged father.

There were also two sets of timeframes for support order

establishment. First, there was a ``front-end'' timeframe at former

Sec. 303.4(d) for IV-D agency activity. It allowed the IV-D agency 90

calendar days, from establishing paternity or locating the obligor, to

establish a support order (by consent) or complete service of process

necessary to commence proceedings to establish a support order (or

document unsuccessful efforts). Second, there were expedited process

timeframes for support order establishment at previous

Sec. 303.101(b)(2) governing activity within a State's quasi-judicial

or administrative agency. Expedited process timeframes were designed to

ensure that cases were adjudicated expeditiously in the State's court

or administrative system. Under the previous definition of expedited

process, a State's process or combination of processes was considered

``expedited'' when the State completed support order establishment from

service of process to disposition in 90 percent of all cases in 3

months, 98 percent in 6 months, and 100 percent in 12 months. These

timeframes also applied to enforcement actions.

Former Timeframes for Paternity and Order Establishment

----------------------------------------------------------------------------------------------------------------

Action needed Reg cite Starting point Time period Ending point

----------------------------------------------------------------------------------------------------------------

Establish Paternity 303.5(a)(1)............ Locate............ 90 calendar days.. File for paternity or SOP,

whichever later.

303.5(a)(2)............ SOP or child's 1 year............ Paternity established or

sixth month. man excluded.

Establish Support 303.4(d)............... Paternity 90 calendar days.. Support order established

Order. establishment or or SOP.

locate.

303.101(b) (2)......... Service of process 90% in 3 months; Support order established/

98% in 6 months; recorded or action

100% in 1 year. dismissed.

----------------------------------------------------------------------------------------------------------------

SOP=Service of process; if agency is unable to serve process, it must document unsuccessful efforts.

This rule replaces the timeframes for paternity and support order

establishment at Secs. 303.4(d), 303.5(a)(1), 303.5(a)(2), and

303.101(b)(2) with two new timeframes (see chart below) at

Secs. 303.4(d) and 303.101(b)(2)(i). Both of the new timeframes apply

to IV-D cases needing support order establishment, regardless of

whether paternity has been established.

New Timeframes for Establishment of Support Order and, if Necessary, Paternity

----------------------------------------------------------------------------------------------------------------

Action needed Reg cite Starting point Time period Ending point

----------------------------------------------------------------------------------------------------------------

Establish Support 303.4(d)............... Locate............ 90 calendar days.. Support order established

Order and, if or SOP.

Necessary,

Paternity.

303.101(b)(2)(i)....... Service of process 75% in 6 months; Support order established/

90% in 12 months. recorded or action

dismissed.

----------------------------------------------------------------------------------------------------------------

SOP=Service of process; if agency is unable to serve process, it must document unsuccessful efforts.

The new ``front-end'' timeframe at Sec. 303.4(d) requires the IV-D

agency, within 90 calendar days of locating the alleged father or

noncustodial parent, to establish a support order or complete service

of process necessary to commence proceedings to establish a support

order and, if necessary, paternity (or document unsuccessful attempts

to serve process, in accordance with the State's guidelines defining

diligent efforts under Sec. 303.3(c)).

In addition, a State must meet the new ``back-end'' timeframe at

Sec. 303.101(b)(2)(i) in order to have an expedited process for

paternity establishment and support order establishment. This timeframe

requires that actions to establish support orders be completed from the

date of service of process to the time of disposition within the

following timeframes: (A) 75 percent in 6 months; and (B) 90 percent in

12 months.

We define ``disposition'' in regulation at Sec. 303.101(b)(2)(iv)

as the date on which a support order is officially established and/or

recorded or the action is dismissed. This definition codifies policy

previously stated at OCSE-AT-88-19. However, we have changed the word

``obligation'' (contained in previous policy and the proposed rule) to

``order'', at the suggestion of a commenter. Parents have the

obligation to support their children from the time of birth; the

establishment or recording of a child support order should be used to

measure case disposition.

Under Sec. 303.101(b)(2)(iii), for purposes of the expedited

process timeframe for paternity and support order establishment, in

cases where the IV-D agency uses long-arm jurisdiction and disposition

occurs within 12 months of the date of service of process, the case may

be counted as successful within the 6 month tier of the timeframe,

regardless of when disposition occurs within the 12 months. Crediting

the State's efforts to keep the proceeding as a one-State case in this

way should encourage States to rely upon long-arm jurisdiction to the

greatest extent possible.

Unlike the previous paternity establishment timeframe at former

Sec. 303.5(a)(2), the new expedited process timeframe begins with

service of process, regardless of the age of the child.

Enforcement Timeframes. The expedited process timeframe at

Sec. 303.101(b)(2)(i) does not apply to enforcement. Instead,

Sec. 303.101(b)(2)(ii) specifies that in IV-D cases where a support

order has been established, actions to enforce the support order must

be taken within the timeframes specified in Secs. 303.6(c)(2) and

303.100. States will be required to meet the existing timeframe at

Sec. 303.6(c)(2) for all enforcement actions other than income

withholding and State/Federal income tax refund offset. The timeframe

at Sec. 303.6(c)(2) requires enforcement action within no more than 30

calendar days (if service of process is not needed) or 60 calendar days

(if service of process is needed) of identifying a delinquency or other

support-related noncompliance, or location of the absent parent,

whichever is later. States will also be required to meet the existing

timeframes at Sec. 303.100 in income withholding cases.

Judges as Presiding Officers. By deleting the phrase ``and under

which the presiding officer is not a judge of the court'' in former

Sec. 303.101(a), we have eliminated the requirement which precluded

using a judge as a presiding officer in carrying out expedited

processes. With this change, expedited processes are now defined in

Sec. 303.101(a) as administrative or expedited judicial processes, or

both, which increase effectiveness and meet processing timeframes.

Other Changes. We amended the safeguards required under

Sec. 303.101(c) to include paternity establishment as well as support

order establishment and enforcement. We revised Sec. 303.101(c)(1) to

require that paternities as well as support orders established via

expedited process, by means other than judicial process, must have the

same effect under State law as paternities and orders established by

full judicial process within the State. We also revised

Sec. 303.101(c)(3) to require that the parties be provided a copy of

the voluntary acknowledgment of paternity, paternity determination,

and/or support order. The remaining safeguards are unchanged except

that they now also apply to expedited paternity processes: The due

process rights of the parties involved must be protected as required by

Sec. 303.101(c)(2); there must be written procedures for ensuring the

qualification of presiding officers as required by Sec. 303.101(c)(4);

recommendations of presiding officers may be ratified by a judge as

allowed by Sec. 303.101(c)(5); and action taken may be reviewed under

the State's generally applicable judicial procedures as provided by

Sec. 303.101(c)(6).

We amended the functions of presiding officers in Sec. 303.101(d)

to cover paternity establishment as well as support order establishment

and enforcement. Section 303.101(d)(2) requires presiding officers to

evaluate evidence and make recommendations to establish paternity as

well as to establish and enforce orders. Section 303.101(d)(3) requires

presiding officers to accept voluntary acknowledgments of paternity, in

addition to voluntary acknowledgments of support liability and

stipulated agreements setting the amount of support to be paid.

Presiding officers will continue to have authority to enter default

orders. However, we amended this requirement at Sec. 303.101(d)(4) to

reflect the language of the default order provision in new

Secs. 302.70(a)(5)(viii) and 303.5(f). As amended, Sec. 303.101(d)(4)

requires that the functions of presiding officers include entering

default orders upon showing that process has been served on the

defendant in accordance with State law, that the defendant has failed

to respond to service in accordance with State procedures, and any

additional showing required by State law. This default order provision

applies to paternity as well as support order establishment cases. We

also added a new function for presiding officers in paternity cases at

Sec. 303.101(d)(5)--ordering genetic tests in contested paternity cases

in accordance with Sec. 303.5(d)(1).

Furthermore, we amended Sec. 303.101(e) regarding exemptions from

expedited process to recognize that expedited process now includes

paternity establishment. Under the amended provision, a State is able

to request an exemption from any of the expedited process requirements

for a political subdivision on the basis of the effectiveness and

timeliness of paternity establishment, support order issuance or

enforcement within the political subdivision in accordance with the

provisions of Sec. 302.70(d).

2. Audit Provisions. This final regulation amends Part 305 in

several ways: by revising the evaluation criteria to reflect

requirements in 45 CFR parts 302 and 303 in effect prior to the Family

Support Act that the States often had not substantially complied with

in the past; by adding criteria to reflect the enactment of the Family

Support Act of 1988 including those governing standards for program

operations, guidelines for setting child support awards, immediate wage

withholding, and review and adjustment of child support orders; by

eliminating duplicative regulations from part 305; by adding evaluation

criteria to reflect the paternity establishment provisions of the OBRA

'93; and, by redefining criteria that States must meet to be determined

to be in substantial compliance.

General Definitions--Sec. 301.1

For consistency with the changes to part 305, the definition of

``procedures'' is removed from Sec. 305.1(b) and placed in alphabetical

order in Sec. 301.1.

Scope of Part 305--Sec. 305.0

Regulations at Sec. 305.0 describe 45 CFR part 305 section by

section. Sections 305.10 through 305.13 describe the audit; Sec. 305.20

defines an effective program for purposes of an audit; Sec. 305.98 sets

forth performance indicators; Sec. 305.99 governs the notice and

corrective action period; and Sec. 305.100 governs the imposition of a

penalty.

Previously, sections 305.21 through 305.57 set forth criteria used

to determine program effectiveness. However, Secs. 305.21 through

305.57 merely cross-referenced and/or restated the requirements in the

corresponding State plan regulations in part 302 and related program

requirements in part 303. Accordingly, we have removed Secs. 305.21

through 305.57 and, revised Sec. 305.20 which lists administrative

criteria States must meet and service-related criteria for which States

must have and use required procedures in a specified percentage of the

cases reviewed for each criterion. In addition, we have revised

Sec. 305.20 to permit the States, when timeframes are not met, to

receive credit when the necessary service is provided during the audit

period. Also, Sec. 305.20 cross-references relevant State plan and

program regulations contained in parts 302 and 303.

Accordingly, Sec. 305.0 is revised to state: Sections 305.10

through 305.13 describe the audit; Sec. 305.20 sets forth audit

criteria and subcriteria OCSE will use to determine program

effectiveness and defines an effective program for purposes of an

audit; Sec. 305.98 sets forth the performance indicators OCSE will use

to determine State IV-D program effectiveness; Sec. 305.99 provides for

the issuance of a notice and corrective action period if a State is

found by the Secretary not to have an effective IV-D program; and

Sec. 305.100 provides for the imposition of a penalty if a State is

found by the Secretary not to have had an effective program and to have

failed to take corrective action and achieve substantial compliance

within the period prescribed by the Secretary.

Definitions--Sec. 305.1

As previously discussed, the definition of ``procedures'' in

Sec. 305.1(b) was moved to Sec. 301.1. Section 305.1 continues to

provide that the definitions found in Sec. 301.1 apply to part 305.

Timing and Scope of the Audit--Sec. 305.10

For consistency with the changes made elsewhere in part 305,

Sec. 305.10(a) is revised to state that the audit of each State's

program will be a comprehensive review using the criteria prescribed in

Secs. 305.20 and 305.98. As a technical change, the title ``Standards

for Audit of Governmental Organizations, Programs, Activities, and

Functions'' in paragraph (c)(2) is changed to ``Government Auditing

Standards.''

State Comments--Sec. 305.12

Previous regulations at Sec. 305.12(a) provided for informing the

IV-D agency during the audit entrance conference of those political

subdivisions of the State that would be audited and making preliminary

arrangements for personnel and information to be made available. We

replaced this provision with more general language indicating that any

necessary arrangements for conducting the audit will be made at the

audit entrance conference. However, no change in current practice, or

in the information provided to States, is intended or anticipated as a

result of this change. States will continue to be notified in the

letter they receive from OCSE in the quarter preceding commencement of

the audit of all information necessary to prepare for the audit.

Effective Support Enforcement--Sec. 305.20

Previous regulations at Sec. 305.20 set forth the criteria which

are used to measure State compliance with the requirements of title IV-

D of the Act.

1. Revised definition of substantial compliance. Section 305.20

redefines the criteria that States must meet to be determined to be in

substantial compliance. As part of this final rule, Sec. 305.20 is

changed to address regulatory requirements including non-AFDC Medicaid

and former AFDC cases, program standards and timeframes requirements,

other program requirements under Pub. L. 100-485 (e.g., guidelines for

setting child support awards, review and adjustment of child support

orders, monthly notice of support collections, mandatory genetic

testing, and immediate wage withholding) and paternity establishment

requirements under OBRA '93.

While program regulations specify how States must operate IV-D

programs to be in compliance with State plan requirements and what

program expenditures may qualify for Federal funding, audit regulations

specify those requirements which must be met in order for a State to be

determined to be in substantial compliance with the requirements of

title IV-D of the Act and to avoid fiscal penalties. We have redefined

substantial compliance to focus on certain criteria: (1) Service-

related criteria with which a significant number of States have failed

to comply in the past; and (2) new or newly-revised criteria. Focusing

on these criteria eliminates many of the administrative or procedural

criteria which were previously part of substantial compliance

determinations and which are currently being met, thereby making the

audit more results-oriented. As previously stated, the audit process is

not the sole means through which State program development and

compliance is determined. OCSE uses program reviews, the State plan

approval process, the program audit process, and the audit resolution

and tracking system to review and monitor State compliance and

performance.

a. Ten percent materiality test. First, the determination of

substantial compliance includes criteria that, based on past audits,

many States have failed. In selecting these criteria, we specifically

examined initial and annual audits conducted under the prior audit

regulations, and determined the number of States that had failed each

existing criterion compared to the number of audit reports issued since

that criterion became effective.

Therefore, the determination of substantial compliance includes

examination of those criteria which, in general, more than ten percent

of the States had failed during that period.

The ten percent test is consistent with the auditing concept of

``materiality.'' According to auditing theory, an audit should be able

to detect errors and conditions that materially affect the ability of

the child support program to achieve desired results and benefits. Ten

percent is commonly used as a benchmark for materiality. In this case,

we believe that if less than ten percent of States are failing a given

criterion, we can omit that criterion from the determination of

substantial compliance without materially affecting the audit's

conclusions about the child support program in the State. However, if a

specific criterion meets the other test for inclusion in substantial

compliance (e.g., it is new or newly-revised), it is not deleted.

More than ten percent of the States failed the following criteria:

Reports and maintenance of records; separation of cash handling and

accounting functions; establishing paternity; distribution; services to

individuals not receiving AFDC or title IV-E foster care assistance;

State parent locator service; support obligations; notice of collection

of assigned support; Federal income tax refund offset; withholding of

unemployment compensation; wage or income withholding; imposition of

liens against real and personal property; posting security, bond or

guarantee to secure payment of overdue support; and medical support

enforcement.

b. New and newly-revised criteria. After applying the ten percent

materiality test to existing audit criteria, we turned to new

requirements (for the most part, based on the Family Support Act of

1988) that have not been audited in the past and which, therefore,

cannot be judged by the ten percent materiality rule. All of these

requirements will be evaluated in the determination of whether a

State's IV-D program is in substantial compliance. Additionally,

because there have been regulatory revisions to several other pre-

existing requirements (e.g., provision of services in interstate IV-D

cases, services to individuals not receiving AFDC or title IV-E foster

care assistance, and medical support requirements), we retained these

revised criteria in the determination of substantial compliance.

Based on past experience with State implementation of new or

significantly-changed program requirements, we believe that States'

activities related to requirements mandated by the Family Support Act

and the OBRA '93 and revised, pre-existing requirements must be audited

to ensure State compliance. These criteria are: Collection and

distribution of support payments by the IV-D agency, Sec. 302.32;

distribution of support collections, Sec. 302.51; notice of collection

of assigned support, Sec. 302.54; guidelines for setting child support

awards, Sec. 302.56; establishment of cases and maintenance of case

records, Sec. 303.2; location of non-custodial parents, Sec. 303.3;

establishment of support obligations, Sec. 303.4; establishment of

paternity, Sec. 303.5; enforcement of support obligations, Sec. 303.6;

State income tax refund offset, Sec. 303.6; provision of services in

interstate IV-D cases, Sec. 303.7; review and adjustment of support

obligations, Sec. 303.8; case closure, Sec. 303.11; securing medical

support information, Sec. 303.30; securing and enforcing medical

support obligations, Sec. 303.31; procedures for wage or income

withholding, Sec. 303.100, and expedited processes, under Sec. 303.101.

We emphasize that States are required to meet all Federal

requirements contained in program regulations, whether or not the

requirements are included under Sec. 305.20. Auditors may still examine

requirements that are not contained in Sec. 305.20, but would issue

management recommendations, instead of findings of substantial

noncompliance, for failure to meet program requirements not included

under Sec. 305.20. Implementation of management recommendations should

help States to improve their performance. In addition, compliance with

all program requirements will continue to be monitored by Regional

Offices of the Administration for Children and Families through program

and financial reviews and the State plan approval process.

In addition to narrowing the number of criteria contained in the

determination of substantial compliance, we have streamlined the audit

regulations by grouping related requirements under certain criteria

(e.g., wage or income withholding under enforcement).

Grouping is merely a way to evaluate related requirements and will

allow audit results to be reported in a more timely manner. States must

still meet the requirements of each specific regulation cited.

2. Criteria States must meet to be determined to be in substantial

compliance. Section 305.20(a) requires that, for audit periods

beginning on or after December 23, 1994, a State must meet the IV-D

State plan requirements contained in part 302 of this chapter measured

as set forth in paragraph (a).

a. Administrative criteria. Under Sec. 305.20(a)(1), the State must

meet the requirements under the following criteria:

(1) Statewide Operations, Sec. 302.10;

(2) Reports and Maintenance of Records, Sec. 302.15(a);

(3) Separation of cash handling and accounting functions,

Sec. 302.20; and

(4) Notice of Collection of Assigned Support, Sec. 302.54.

b. Service-related criteria.

i. 90 percent standard for case opening and closure. Unless

applications are provided upon request and accepted in a timely manner

and cases are opened and maintained appropriately, needed IV-D services

cannot be provided. Furthermore, with regard to case closure criteria,

it is essential that only those cases for which there is no reasonable

expectation of establishing paternity, obtaining a support order, or

collecting child support, either now or in the future, are closed.

In response to our request for comments regarding the 90 percent

standard proposed in the September 9, 1993 proposed rule, we received

many insightful comments, which are set forth later in this preamble.

In reviewing comments to the proposed rule, we agree that all program

services should be evaluated using a consistent standard (75 percent),

and are limiting the application of the 90 percent standard to case

opening requirements in Sec. 303.2(a) and case closure requirements in

Sec. 303.11. The requirements at Sec. 303.2(b) regarding the standard,

and the requirements at Sec. 303.2(a) regarding the opening of a case

will be evaluated using the 90 percent standard establishment of a case

record and determination of necessary action on the case will be

evaluated using the 75 percent. Therefore, we require that, in order to

be determined to be in substantial compliance, States must have and use

the procedures for providing applications and information and accepting

applications set forth in Sec. 303.2(a) and case closure requirements

at Sec. 303.11, which were effective October 1, 1990, in at least 90

percent of the cases reviewed for each criterion.

To reflect the changes discussed above, Sec. 305.20(a)(2) provides

that, for audits conducted for any period beginning on or after

December 23, 1994, to be determined to be in substantial compliance,

the State must have and use procedures required under the following

criteria in at least 90 percent of the cases reviewed for each

criterion:

(1) Establishment of Cases, Sec. 303.2(a); and

(2) Case Closure, Sec. 303.11.

Under the case closure criteria, auditors will evaluate cases

closed during the audit period to determine compliance with the

requirements of Sec. 303.11. It is important to recognize that States

will be evaluated to determine whether closure of cases was

appropriate. As explained in response to comments in the final rule

governing Standards for Program Operations (54 FR at 32303), States are

not required to close cases, however, and should a case which meets the

criteria for case closure be left open, it would not count against the

State for the purpose of determining compliance.

ii. 75 percent standard for providing services. Section

305.20(a)(3) provides that, for audit periods beginning on or after

December 23, 1994, to be determined to be in substantial compliance,

the State must have and use procedures required under the following

criteria in at least 75 percent of the cases reviewed for each

criterion:

(1) Collection and Distribution of Support Payments, including:

Collection and distribution of support payments by the IV-D agency

under Secs. 302.32(b) and (f); distribution of support collections

under Sec. 302.51; and distribution of support collected in title IV-E

foster care maintenance cases under Sec. 302.52;

(2) Establishment of paternity and support orders, including:

Establishment of a case under Sec. 303.2(b); services to individuals

not receiving AFDC or title IV-E foster care assistance, under

Secs. 302.33(a)(1) through (4); provision of services in interstate IV-

D cases under Secs. 303.7 (a), (b), and (c)(1) through (6), and (8)

through (10); location of non-custodial parents under Sec. 303.3;

establishment of paternity under Secs. 303.5(a) and (f); guidelines for

setting child support awards under Sec. 302.56; and establishment of

support obligations under Secs. 303.4 (d), (e) and (f);

(3) Enforcement of support obligations, including, in all

appropriate cases: Establishment of a case under Sec. 303.2(b);

services to individuals not receiving AFDC or title IV-E foster care

assistance, under Secs. 302.33 (a)(1) through (4); provision of

services in interstate IV-D cases under Secs. 303.7(a), (b), and (c)

(1) through (6), and (8) through (10); location of non-custodial

parents under Sec. 303.3; enforcement of support obligations under

Sec. 303.6, including submitting once a year all appropriate cases in

accordance with Sec. 303.6(c)(3) to State and Federal income tax refund

offset; and wage withholding under Sec. 303.100. In cases in which wage

withholding cannot be implemented or is not available and the non-

custodial parent has been located, States must use or attempt to use at

least one enforcement technique available under State law in addition

to Federal and State income tax refund offset, in accordance with State

laws and procedures and applicable State guidelines developed under

Sec. 302.70(b) of this chapter;

(4) Review and adjustment of child support orders, including:

Establishment of a case under Sec. 303.2(b); services to individuals

not receiving AFDC or title IV-E foster care assistance, under

Secs. 302.33(a)(1) through (4); provision of services in interstate IV-

D cases under Secs. 303.7 (a), (b), and (c)(1) through (6), and (8)

through (10); location of non-custodial parents under Sec. 303.3;

guidelines for setting child support awards under Sec. 302.56; and

review and adjustment of support obligations under Sec. 303.8; and

(5) Medical support, including: Establishment of a case under

Sec. 303.2(b); services to individuals not receiving AFDC or title IV-E

foster care assistance, under Secs. 302.33(a)(1) through (4); provision

of services in interstate IV-D cases under Secs. 303.7(a), (b), and (c)

(1) through (6), and (8) through (10); location of non-custodial

parents under Sec. 303.3; securing medical support information under

Sec. 303.30; and securing and enforcing medical support obligations

under Sec. 303.31.

In this final regulation, we have established a standard for

expedited processes at Secs. 303.101(b)(2) (i) and (iii), and

corresponding audit criteria at Sec. 305.20(a)(5) to measure the

establishment of a support order and, when necessary, the establishment

of paternity. These changes reflect the paternity establishment

provisions of the OBRA '93. Since States that need to establish

paternity and a support order often complete both activities at about

the same time, and the new expedited processes standard covers both

activities, we have combined into a single grouping the audit criteria

we will use to evaluate State compliance with Federal requirements for

establishment of an order and paternity establishment under the 75

percent audit standard. We believe that this change will further

streamline the audit process.

Location Evaluated as Part of Services Provided. Under this final

regulation, location is not listed as a separate criterion but is

included under the paternity and support order establishment,

enforcement, review and adjustment, and medical support criteria. The

location function is not an end in itself, but an essential component

of delivering program services. We do not believe that this diminishes

the significance of the location function. On the contrary, it

underscores the need to use all appropriate location sources in order

to proceed with delivering the necessary services in the case.

Moreover, it is illustrative of the transition to a more results-

oriented, outcome-focused audit.

Thus, if a case requires establishment of a support obligation and

the non-custodial parent's whereabouts are unknown, the State must meet

the applicable location requirements at Sec. 303.3 and, if the non-

custodial parent has been successfully located, the requirements for

support obligation establishment at Secs. 303.4 (d), (e), and (f) and

Sec. 302.56 in any case reviewed for purposes of the audit. If the

State does not meet the location requirements in a case requiring

support obligation establishment, it would be counted against the State

in computing the efficiency rate for support obligation establishment

and the audit findings would reflect that the State failed to

substantially comply with the support obligation establishment

requirements due, at least in part, to a failure to meet the location

requirements. In response to our request for specific comments

regarding the potential effect of evaluating locate as a component of

other services rather than as a specific service, we received valuable

and constructive input, which is described more extensively in the

Response to Comments section later in this preamble.

If a support obligation cannot be established because the parent

from whom support is sought is not located, even though the State met

all other location requirements (i.e., checked all appropriate sources

and repeated location attempts) this would not be counted against the

State. There is, currently, a perceived misunderstanding that States

must obtain a successful outcome in a case in order to receive credit

for having worked that case. We would like to clarify that if a State

meets all Federal requirements, including timeframes, with respect to a

particular case but cannot locate the non-custodial parent or alleged

father, for example, the State would not be penalized for failure to

provide the necessary service. Instead, we would credit the State with

taking appropriate action.

Interstate and Non-AFDC Services as Part of Services Provided.

Under this final regulation, the provision of services in interstate

cases, and services to individuals not receiving AFDC or title IV-E

foster care are included under the paternity and support order

establishment, enforcement, review and adjustment, and medical support

criteria. It is long-standing Federal policy that all appropriate

services should be provided in all cases regardless of type (non-AFDC

IV-D; interstate IV-D). Therefore, we believe that all types of IV-D

cases (i.e., AFDC, title IV-E foster care, non-AFDC, and interstate)

should be evaluated in a similar manner. In addition, the requirements

unique to interstate and non-AFDC cases are not an end in themselves,

but an essential component of delivering program services for such

cases. Furthermore, these changes are illustrative of a transition to a

more results-oriented outcome-focused audit.

Under this approach, States will still be held accountable for

meeting requirements that are unique to interstate cases,

Secs. 303.7(a), (b), (c)(1) through (6) and (8) through (10), as well

as functions and services otherwise covered by criteria under

Sec. 305.20 to determine whether the State is in substantial compliance

with the requirement to provide appropriate services in an interstate

case. Similarly, States will still be held accountable for meeting

those aspects of Sec. 302.33 unique to non-AFDC IV-D cases (i.e.,

Secs. 302.33(a)(1) through (4)) to determine whether the State is in

substantial compliance with requirements to provide services to non-

AFDC individuals. These changes are also addressed in the response to

comments section of this preamble.

Enforcement. Under this final regulation, use of some enforcement

techniques would be mandatory in all appropriate cases in accordance

with Federal requirements, i.e., wage withholding and submitting once a

year all cases, in accordance with Sec. 303.6(c)(3), to State and

Federal income tax refund offset. States must take these actions in all

appropriate cases, in accordance with Sec. 303.6. Section 303.6(c)(3)

requires annual submittal for income tax refund offset of all cases

which meet the certification requirements under Sec. 303.102 and State

guidelines developed under Sec. 302.70(b) for State income tax refund

offset, and which meet the certification requirements under Sec. 303.72

for Federal income tax refund offset.

Cases exist in which wage withholding is not available or

appropriate because, for example, the obligated parent is self-

employed, unemployed, or does not have a source of income subject to

withholding; or the obligor and/or employer cannot be located. In these

cases, if the non-custodial parent has been successfully located, some

other enforcement technique, in addition to Federal and State income

tax refund offset, must be used. States have discretion with respect to

the use of other enforcement techniques (besides wage withholding and

Federal and State income tax refund offset) as long as there is

compliance with Federal regulations, State procedures, and guidelines

developed by the State under Sec. 302.70(b) which outline when it is

inappropriate to use an enforcement technique.

Under this final regulation, for cases in which wage withholding

cannot be implemented or is unavailable, States will receive credit,

for audit purposes, for taking or attempting an enforcement action if

they do any one of the following in accordance with Sec. 303.6: Impose

a lien against real and personal property under Sec. 303.103; require

the obligor to post security, bond, or other guarantee to secure

payment of overdue support under Sec. 303.104; make information

available to consumer credit reporting agencies under Sec. 303.105;

withhold unemployment compensation under Sec. 302.65; or request full

collection services by the Secretary of the Treasury under Sec. 303.71.

A State will also receive credit for enforcement if it takes an

enforcement action that is not specifically listed above, if the action

is consistent with Federal or State laws and procedures.

This final regulation emphasizes the use of wage withholding and

income tax refund offset, which are often the most effective

enforcement techniques, yet ensures that more difficult cases in which

wage withholding cannot be utilized, are not ignored. For those cases

in which wage withholding is not implemented, it ensures that at least

one enforcement action is taken in each case during the audit period.

States are encouraged to implement several enforcement techniques

concurrently, although they will not be penalized for failure to do so.

iii. Credit for providing services. Paragraph (a)(4) indicates

that, with respect to meeting the 75 percent standard under

Sec. 305.20(a)(3), for any audit period beginning on or after December

23, 1994:

(1) Notwithstanding timeframes for establishment of cases in

Sec. 303.2(b); provision of services in interstate IV-D cases under

Secs. 303.7 (a), (b), and (c) (4) through (6), (8) and (9); location

and support order establishment under Secs. 303.3(b) (3) and (5), and

303.4(d), if a support order needs to be established in a case and an

order is established during the audit period in accordance with the

State's guidelines for setting child support awards, the State will be

considered to have taken appropriate action in that case for audit

purposes.

(2) Notwithstanding timeframes for establishment of cases in

Sec. 303.2(b); provision of services in interstate IV-D cases under

Secs. 303.7 (a), (b), and (c) (4) through (6), (8) and (9); location

and review and adjustment of support orders contained in Secs. 303.3(b)

(3) and (5), and 303.8, if a particular case has been reviewed and

meets the conditions for adjustment under State laws and procedures in

Sec. 303.8, and the order is adjusted, or a determination is made, as a

result of a review that an adjustment is not appropriate, during the

audit period in accordance with the State's guidelines for setting

child support awards, the State will be considered to have taken

appropriate action for review and adjustment of orders in that case for

audit purposes.

(3) Notwithstanding timeframes for establishment of cases in

Sec. 303.2(b); provision of services in interstate IV-D cases under

Secs. 303.7 (a), (b), and (c) (4) through (6), (8) and (9); location

and wage withholding in Secs. 303.3(b) (3) and (5), and 303.100, if

wage withholding is appropriate and implemented in a particular case,

and wages are withheld during the audit period, the State will be

considered to have taken appropriate action in that case for audit

purposes.

(4) Notwithstanding timeframes for establishment of cases in

Sec. 303.2(b); provision of services in interstate IV-D cases under

Secs. 303.7 (a), (b), and (c) (4) through (6), (8) and (9); location

and enforcement of support obligations in Secs. 303.3(b) (3) and (5),

and 303.6, if wage withholding is not appropriate in a particular case,

and the State uses at least one enforcement technique available under

State law in addition to Federal and State income tax refund offset,

which results in a collection received during the audit period, the

State will be considered to have taken appropriate action in the case

for audit purposes.

When a State is considered to have taken an appropriate action in a

case for audit purposes, as stated above, the case would count towards

meeting the 75 percent standard in Sec. 305.20(a)(3) for paternity and

support order establishment, review and adjustment of support orders,

and enforcement of support obligations, as appropriate. Under paragraph

(a)(4), a State would receive credit in such an instance for taking an

action in a case even if relevant timeframes are missed. These

timeframes include the timeframe for establishment of cases under

Sec. 303.2(b); timeframes for location in Secs. 303.3(b) (3) and (5);

and timeframes for provision of services in interstate IV-D cases under

Secs. 303.7 (a), (b), and (c) (4) through (6), (8) and (9).

These credits are another indication of the transition to a more

results-oriented audit. We believe that, for audit purposes, a State

should not be penalized when intermediate timeframes are missed in a

case if a successful result is achieved within the audit period (i.e.,

paternity and a support order are established, an order is adjusted or

determined to be not needed, wages are withheld, or a collection is

made), since these results are the primary goals of the child support

enforcement program.

Furthermore, we believe that this position is responsive to the

concerns of States that missing an interim timeframe may create a

disincentive to work the case through to completion of the action.

However, under this final regulation, if interim timeframes are not

met in a case, States would only get credit for taking an appropriate

action if the action is successfully completed, not simply attempted,

within the audit period. For example, if timeframes are missed in a

case, a State can get credit for: Paternity and order establishment,

only if paternity (if needed) and a support order are established; wage

withholding, only if withholding is implemented and wages are withheld

as a result; and support order adjustment, only if the order is

adjusted or determined to not require adjustment.

We emphasize that a State has to successfully complete an action in

order to receive credit in a case only if timeframes are not met in the

case. If, in a particular case, a State complies with the requirements,

including the timeframes, the State will get credit for taking an

action in that case even if the action is not successful.

Collection of unpaid support through enforcement is a major goal of

the program. As a result, when enforcement timeframes are missed, the

State will be credited for wage withholding, or, if wage withholding is

not appropriate in a given case, the use of some other appropriate

enforcement technique available under State law, in addition to the

Federal and State income tax refund offset, if such action results in a

collection during the audit period. Wage withholding is subject to

specific timeframes in Sec. 303.100. State and Federal income tax

refund offset, also a highly efficient and effective procedure, are not

subject to similar case processing timeframes. Other enforcement

techniques are subject to the general timeframe in Sec. 303.6.

Since some enforcement techniques, such as liens and consumer

credit reporting, may not immediately result in collections and because

it is difficult to determine when and if these actions have been

successful in collecting support, States will only be credited when a

collection is received. In successful wage withholding cases,

collections usually occur almost immediately, so it is easy to

determine when it has been successfully completed.

We emphasize that all timeframes, including those for paternity and

support order establishment, review and adjustment, and wage

withholding, are still Federal requirements that States must meet.

However, as described above, States may receive credit for taking an

action under Sec. 305.20(a)(4) when the outcome is successful even if

timeframes are missed in a case.

c. Expedited processes. Paragraph (a)(5) requires that, for audit

periods beginning on and after December 23, 1994, the State must meet

the requirements for Expedited Processes under Sec. 303.101 to be in

substantial compliance. Prior to the issuance of this final rule, the

compliance percentages contained in the expedited processes regulation

were used to evaluate State performance rather than the 75 percent

audit standard. The new compliance percentages contained in the

expedited processes regulation revised in this final rule will be

evaluated in the same manner. Therefore, the evaluation of the

expedited processes compliance percentages discussed earlier in this

preamble will continue to be separated from the service-related

category which is evaluated using a 75 percent standard.

d. Performance indicators. Paragraph (a)(6) continues to require

that the State must meet the criteria referred to in Sec. 305.98(c) of

this part relating to the performance indicators prescribed in

paragraph (a) of that section.

Paternity Establishment Percentage Standard--Proposed Sec. 305.97

Section III of the Family Support Act of 1988 amended section 452

of the Act by adding a new paternity establishment standard, at

subsection (g), that States must meet for any fiscal year beginning on

or after October 1, 1991. In the proposed rule, we proposed to add a

new Sec. 305.97, titled Paternity Establishment Percentage Standard,

which would set forth the requirements States must meet in order to be

determined to be in substantial compliance with title IV-D of the Act.

However, because of recent statutory changes to the standard, it will

be dealt with separately and is not included in this final rule. As

part of the OBRA '93 (Pub. L. 103-66), Congress revised the paternity

establishment standard, including the description of data needed to

calculate the ratio. Subsequently, Congress enacted Pub. L. 103-432

which included technical amendments that corrected the description of

the terms of the standard.

Performance Indicators--Sec. 305.98

Section 305.98(c) is revised to indicate that OCSE continues to use

the procedures and audit criteria in that paragraph to measure State

performance. Paragraph (d) is revised to state that the performance

indicator scoring system will be described and updated periodically by

the Office (i.e., OCSE). We will publish any changes to the scoring

system in the Federal Register in advance of their effective date.

Notice and Corrective Action Period--Sec. 305.99

Former Sec. 305.99(b)(2) provided that the notice of substantial

noncompliance identify any audit criteria listed in Secs. 305.20

(a)(2), (b)(2) or (c)(2) that the State met only marginally (that is,

in 75 to 80 percent of the cases reviewed). Revised Sec. 305.99(b)(2)

provides that the notice of substantial noncompliance identify any

audit criteria listed in Sec. 305.20(a)(3) of this part that the State

met only marginally [that is, in 75 to 80 percent of cases reviewed for

criteria in (a)(3)]. This change replaces the reference to Secs. 305.20

(a)(2), (b)(2) or (c)(2) with Sec. 305.20(a)(3).

Response to Comments

1. Paternity Establishment Provisions.

In response to the Notice of Proposed Rulemaking published November

29, 1993, in the Federal Register (58 FR 62599), we received over 60

comments from representatives of State and local IV-D agencies,

national organizations, advocacy groups, and private citizens. Their

comments and our responses are as follows:

General Comments

1. Comment: One commenter requested that OCSE liberally grant

waivers from the new requirements if a State has laws, processes, or

procedures which achieve the aims of the statutory paternity provisions

under OBRA '93.

Response: Procedures regarding exemptions are delineated at

Sec. 302.70(d) and OCSE-AT-88-19. (Although the procedures in OCSE-AT-

88-19 refer to former expedited process requirements, these procedures

may be used until they are updated to reflect the new expedited process

requirements). A State may apply for an exemption from adopting any of

the required State laws at Sec. 302.70(a) by submitting a request for

an exemption to the Federal Regional Office. The Secretary will grant a

State (or political subdivision in the case of expedited process

requirements) an exemption for a period of up to three years in the

limited instances where the State demonstrates that compliance would

not increase the effectiveness and efficiency of its IV-D program.

2. Comment: One commenter suggested that the statutory effective

date should apply only to the Federal statutory provisions, and that

States should be given additional time, after the issuance of final

regulations, to comply with any Federal regulatory requirements

implementing the statutory provisions. According to this commenter, the

effective date of any regulatory requirements based upon the Federal

statute should be linked to the end of each State's next legislative

session following publication of the final rule.

Response: We are not linking the effective date of this regulation

to each State's next legislative session following publication of this

rule. The statutory effective date, which is linked to States'

legislative sessions, applies to statutory requirements, even if the

statutory effective date occurred prior to publication of these final

regulations. If the Federal statutory effective date for a State occurs

after publication of these regulations, these regulations will not be

effective until the statutory effective date. Furthermore, these

regulations allow States until January 1, 1995 (or the Federal

statutory effective date, if later) to implement hospital-based

programs statewide. Therefore, we do not believe additional

implementation time for regulatory requirements is necessary.

3. Comment: One commenter suggested that we retain the list of

effective dates, previously at Sec. 302.70(a), for required State laws.

Response: To simplify the regulatory language, we have deleted

effective dates of IV-D State plan requirements previously listed in

Sec. 302.70(a). The effective dates had been listed to differentiate

between requirements that became effective at different times. However,

since all requirements listed at Sec. 302.70(a) are now effective, we

believe it is unnecessarily cumbersome to enumerate all the various

effective dates in the regulation. Each IV-D State plan requirement,

including the new paternity ones, remains effective on the date

indicated by the statute or implementing regulation.

Simple Civil Process for Voluntarily Acknowledging Paternity--Sections

302.70(a)(5)(iii) and 303.5(a)

a. General Requirements, Rights and Responsibilities, and Due

Process.

1. Comment: Several commenters questioned why requirements

regarding general voluntary acknowledgment procedures are not as

detailed as the requirements regarding hospital-based voluntary

acknowledgment programs.

Response: Regulations regarding the general voluntary

acknowledgment process are not as detailed as those covering hospital-

based programs. The reason for this differentiation is that the vast

majority of States, if not all States, had already implemented general

voluntary acknowledgment procedures prior to the passage of OBRA '93.

Given that no national problem has been identified regarding these

existing State procedures, we do not want to impede their successful,

ongoing operation. For example, States have already developed forms and

materials that meet the requirements of State law and that have

withstood judicial review. We do not want to impose detailed Federal

requirements that would unnecessarily force States to develop new forms

and materials.

We do, however, encourage States to reexamine their existing

voluntary acknowledgment procedures to ensure that they are simple,

provide sufficient information to the parties, and are regularly used.

The voluntary acknowledgment process should be available at any time to

fathers who want to voluntarily acknowledge paternity. Ideally, States

will allow fathers multiple opportunities to voluntarily acknowledge at

any stage in the process. Even if a man is initially reluctant to

voluntarily acknowledge parentage because he is unsure whether he is

actually the father, he may be willing to do so after receiving genetic

test results which indicate a high probability of paternity.

While we have tried to avoid unnecessary Federal intervention

regarding general voluntary acknowledgment requirements, there is a

need for detailed Federal requirements regarding hospital-based

programs. While some States had organized hospital-based programs prior

to passage of OBRA '93, most of these programs were not statewide in

scope. Therefore, in many parts of the country such programs do not yet

exist or are not well-established. Detailed Federal requirements should

help to ensure that such programs are properly implemented. As several

commenters on the proposed rule pointed out, States which have

implemented hospital-based programs have found that programs are most

effective where trained staff and explanatory materials are available

to assist the parents.

In addition, the special circumstances of a hospital environment

warrant detailed Federal oversight. For medical records staff and

health care workers in hospital-based programs, providing voluntary

acknowledgment services is only an ancillary activity to their main

responsibilities. Hospital staff may not be as familiar with paternity

and child support issues as IV-D or court staff involved in voluntary

acknowledgment procedures outside of hospitals.

Furthermore, as several commenters pointed out, during the hours

following birth, the mother may be in physical pain, mentally exhausted

or preoccupied, and inundated with information regarding the health and

care of her newborn child. Hospital staff providing voluntary

acknowledgment services may not be aware of salient issues in a case,

such as domestic violence. (When voluntary acknowledgments are made

outside of the hospital, child support personnel may be more likely to

learn of such issues during initial interviews with the woman).

In light of these special circumstances, the detailed requirements

at Sec. 303.5(g) are designed to ensure that the voluntary

acknowledgment process in hospitals is truly voluntary and appropriate,

and that both the mother and alleged father have adequate information

to make an informed decision.

2. Comment: Many commenters recommended detailed and specific

Federal requirements regarding the explanation of rights and

responsibilities and due process safeguards.

Response: We agree with commenters about the importance of this

issue. Under regulations at Sec. 302.70(a)(5)(iii), States are required

to explain to both parents the rights and responsibilities of

acknowledging paternity. The explanation should describe the rights and

responsibilities, including the duty to support the child financially,

that each party will assume as a result of signing the acknowledgment.

It should also describe rights that each party may be giving up by

signing the acknowledgment (e.g., right to genetic testing). These

rights and responsibilities will vary by State, depending on State law.

For out-of-hospital acknowledgments, as long as the explanation

meets State due process requirements, it may be verbal or in writing.

However, we recommend that this disclosure of rights be provided in a

written format that is clear and easily understood. Furthermore, we

encourage States to place this written explanation on the

acknowledgment form itself. As one commenter indicated, if a party

later challenges the validity of an acknowledgment, a written

explanation of rights and responsibilities on the form will provide

evidence that notification occurred. Section 302.70(a)(5)(iii) also

requires a State to meet any due process requirements necessary under

State law and court rulings. (Federal requirements regarding hospital-

based programs are somewhat more prescriptive due to the special

circumstances of a hospital environment as previously discussed.

Hospital-based program requirements are discussed in greater detail

later in this preamble).

However, consistent with past policy, we are not mandating detailed

Federal due process requirements. Generally, a State is in a better

position than the Federal government to determine the exact nature of

such requirements in light of the State's particular circumstances. As

one commenter stressed, a State needs to tailor its requirements to

address the legal effect of the acknowledgment under State law--e.g.,

whether the acknowledgment creates a rebuttable or conclusive

presumption. States' due process requirements also vary depending on

State law and court rulings. However, because of the importance of the

due process and rights and responsibilities issue, OCSE is committed to

providing technical assistance, within its available resources,

including sharing sample forms and materials from other jurisdictions,

in order to assist States.

We also encourage States to consider, for both in-hospital and out-

of-hospital acknowledgments, a number of suggestions recommended by

commenters, including providing: Both a verbal and a written

description of the rights, responsibilities, and consequences resulting

from acknowledging paternity; a clear, written explanation of the legal

significance of a paternity acknowledgment under State law; a written

notice that the parties may wish to seek legal advice prior to signing

the acknowledgment; a written statement explaining that completion of

the form is voluntary; procedures requiring the acknowledging parents

to sign a statement indicating that they understand their rights and

responsibilities; and training of staff and making IV-D agency staff

available in person or by telephone to ensure that acknowledgments are

voluntary and completed only after parents understand the consequences.

3. Comment: Several commenters argued that special protections are

needed, as a part of both in-hospital and out-of-hospital voluntary

acknowledgment procedures, for cases involving illiterate, non-English

speaking, mentally incapacitated, blind, or hearing-impaired persons.

Response: We agree that special protections may be needed in such

cases. However, just as a State generally has discretion regarding due

process safeguards in ``regular'' cases, we are also giving States

discretion in cases involving special circumstances. This allows each

State to formulate policies which address its own particular

requirements, including case law, regarding due process. States, IV-D

agencies, and birthing hospitals are in the best position to determine

the details of how to respond to special circumstances in their State's

population or a facility's service area (e.g., languages other than

English in which to publish materials and forms).

Despite this discretion, we encourage and expect States and IV-D

agencies to address the special circumstances mentioned by commenters,

as necessary, by setting appropriate policies, developing materials,

and providing training to both hospital-based program and IV-D staff.

As commenters cautioned, acknowledgments in such cases may be

challenged if appropriate safeguards are not followed. We believe that

States have already shown sensitivity to these special circumstances

and there is no need for direct Federal intervention. For example,

several States have developed paternity establishment materials and

forms in languages other than English.

4. Comment: Several commenters suggested the need to include

provisions regarding custody and visitation as part of the

acknowledgment process. Some commenters suggested that parents, when

given the opportunity to voluntarily acknowledge paternity, ought to be

given the chance to complete forms regarding custody and visitation.

Another commenter suggested that if the alleged father acknowledges

paternity at the hospital, a custody order should also be entered for

the mother at the same time to protect the mother's parental rights.

Response: We are not mandating requirements regarding custody and

visitation because the paternity provisions of OBRA '93 and the other

provisions of title IV-D of the Act do not address custody or

visitation issues, and these are essentially State matters. However,

when giving the parents the opportunity to voluntarily acknowledge

paternity, we would also encourage that both parents receive an

explanation, either in writing or verbally, about the potential impact

of an acknowledgment under State law on custody and visitation.

b. Acknowledgment Form.

1. Comment: We received numerous comments regarding the proposal to

require that States use a standard acknowledgment form incorporating

certain minimum elements. Some commenters objected to the mandated use

of an acknowledgment form and questioned whether it would prohibit

States from using other, previously-established methods for obtaining

voluntary acknowledgments.

Other commenters expressed concern about the specific elements that

we proposed the forms should include. Commenters objected to mandating

inclusion of: (1) Filing instructions because the instructions would

not be applicable to all situations, (2) a line for the parents' social

security numbers due to privacy concerns, and (3) parents' addresses

due to the transitory nature of addresses. On the other hand, several

commenters suggested that the form contain both the parents' and

child's dates of birth--data elements that we had not proposed to

require. Other commenters maintained that mandating any minimum form

elements was unduly restrictive and that States should be allowed to

design their own forms.

Response: In response to commenters' concerns, we are not mandating

use of a uniform acknowledgment form. As stated in the preamble to the

proposed rule, mandating a form with minimum elements was intended to

standardize interstate case processing. However, based on comments to

the proposed rule, it is clear that our proposal would not have solved

interstate problems. Some States use voluntary acknowledgment

procedures, other than an acknowledgment form, that do not contain the

uniform elements. Furthermore, because there is no agreement among

States regarding what the elements of an acknowledgment form should be,

State forms would have continued to vary in many respects even if some

uniform elements were mandated. (Differences in State forms or

procedures should not be an issue if an acknowledgment creates a

determination of paternity subject to full faith and credit, but may be

an issue if an acknowledgment does not create a determination of

paternity). As one commenter pointed out, in order to avoid interstate

problems, we would have to mandate use of a standardized national form.

However, we believe a standardized national form would unnecessarily

disrupt many States' long-standing and successfully-operating voluntary

acknowledgment procedures.

Although we are not mandating the use of a form with minimum

elements, States must have procedures for a simple civil process for

voluntarily acknowledging paternity in accordance with

Sec. 302.70(a)(5)(iii). We anticipate that most States will use some

type of acknowledgment form, and we encourage States to include on the

form data elements that provide valuable locate and identifying

information. These elements may include: Parents' social security

numbers, dates of birth, and addresses. If a State's form includes the

social security numbers of the parents, the recording of voluntary

acknowledgments might be a way of obtaining social security numbers

from parents as required during the birth registration process by

section 205(c)(2)(C)(ii) of the Social Security Act. OCSE plans to

provide States with examples of voluntary acknowledgment forms used in

various jurisdictions around the country.

2. Comment: Several commenters objected to the proposed requirement

that a voluntary acknowledgment be signed by both parents. This

provision of the proposed rule would have also required that the

parents' signatures be authenticated by a notary or witness(es).

According to commenters, it would be burdensome, time-consuming,

costly, and unnecessary to have both parents sign the same form,

particularly if the parents live in different States. These commenters

noted that frequently in IV-D cases the mother is not present when the

father acknowledges paternity but that she has previously named the

acknowledging man as the father in writing. As one commenter suggested,

the proposal may have made it necessary for the IV-D agency to find the

mother once the man acknowledged, even if she had previously named the

man as the father, to have her sign in front of a notary or witness the

same acknowledgment form that the father signed. In addition,

commenters noted that, under some existing State laws, a man can

voluntarily acknowledge paternity without the mother's consent (only

under certain circumstances in some States; e.g., if genetic test

results create a presumption of paternity, or the mother is deceased or

mentally incapacitated).

Response: In response to commenters' concerns, for general

voluntary acknowledgment procedures, we are not requiring that both

parents sign the same form in front of a notary public or witness(es).

We want to avoid unnecessary Federal interference with State's

previously-established and successfully-operating voluntary

acknowledgment procedures. We note, however, that if an acknowledgment

form with signature lines for both parents contains space for a notary

or witness to authenticate each signature separately (as recommended by

one commenter), the parents do not necessarily have to sign the form at

the same time.

This rule does compel the State to require that a voluntary

acknowledgment obtained through a hospital-based program be signed by

both parents, and that the parents' signatures be authenticated by a

notary or witness(es). We are including this requirement at

Sec. 303.5(g)(4), rather than at Sec. 302.70 as in the proposed rule,

since we are limiting its scope to hospital-based programs. Regarding

mandating the use of notaries, we believe such a requirement would

unnecessarily interfere with State practice and create problems in

hospitals where notaries may not always be readily available.

Since the mother will be present in cases in which the father signs

a voluntary acknowledgment at the hospital, it is not burdensome to

require that both parents sign in such cases (although they need not

both sign the form at the same time). Furthermore, we want to ensure

that the process at the hospital is truly voluntary and that an

acknowledgment is made only when both parents agree about the man's

paternity. Even if a man is willing to acknowledge paternity, the

mother may deny that he is the father, or may not want paternity to be

established (due to domestic violence or other circumstances).

Hospitals should not have to mediate disputes or pursue cases where the

parties disagree about the man's paternity. If a party in such a case

wishes to establish paternity without the cooperation of the other

party, he or she could contact the IV-D agency or a private attorney.

States can meet the requirements of Sec. 303.5(g)(4) by developing

and mandating the use of a form for hospital-based programs which

contains signature lines for both parents and a notary public or

witness(es).

c. IV-D Agency Activity.

1. Comment: One commenter suggested that the proposed requirement

at Sec. 303.5(a), requiring the IV-D agency to offer the alleged father

the opportunity to acknowledge paternity in IV-D cases in which

paternity has not been established and a voluntary acknowledgment has

not been obtained, was overly broad. The commenter suggested that there

are cases, particularly under some State laws, where it is

inappropriate to pursue a voluntary acknowledgment--e.g., cases where

the alleged father is a minor or lacks the requisite mental capacity.

Response: We revised this provision to require that the IV-D agency

offer the alleged father, as appropriate, the opportunity to

acknowledge paternity. If a IV-D agency determines that it would not be

appropriate to offer the alleged father an opportunity to voluntarily

acknowledge paternity, it must: (1) Document in the case record the

specific reason it is inappropriate to seek an acknowledgment, and (2)

attempt to establish paternity by legal process established under State

law.

Adding ``as appropriate'' allowed us to delete the phrase ``and a

voluntary acknowledgment has not been obtained'' in the proposed

introductory language of Sec. 303.5(a) describing the applicability of

the provision. Since the IV-D agency acts in accordance with

Sec. 303.5(a) ``as appropriate'', the provision now applies broadly to

any case ``in which paternity has not been established''. Seeking a

voluntary acknowledgment in a case where an acknowledgment has

previously been obtained would not be appropriate.

2. Comment: One commenter asked if mailing an acknowledgment form

to the alleged father's last known address with no verification of

receipt would meet the requirement at Sec. 303.5(a) for providing the

alleged father the opportunity to voluntarily acknowledge paternity.

Response: In order to satisfy this requirement, IV-D staff may

contact the alleged father by telephone, written notice, or in person

as appropriate under the circumstances and State law. Written notice

may be given by mail, personal service, or other means; however, it

must be addressed specifically to the individual alleged father. We

strongly encourage that language in written notices be ``reader-

friendly'': i.e., clear and easy to understand. The IV-D agency should

advise the man that the mother has named him as the father of the

child, describe the procedures for voluntarily acknowledging paternity,

and advise him of his rights and responsibilities. The IV-D agency must

document in the case record when and how the alleged father is sent or

given notice of the paternity action and the opportunity to voluntarily

acknowledge.

Mailing an acknowledgment form to the alleged father's last known

address will satisfy this requirement, if the man can acknowledge

paternity by completing and returning the form. However, the IV-D

agency must meet the requirements mentioned above (advising the man

that the mother has named him as the father of the child, describing

the procedures for voluntarily acknowledging paternity, and advising

him of his rights and responsibilities) via the form, attached written

materials, or other means.

Although mailing a form is sufficient to meet the requirement at

Sec. 303.5(a), we encourage States to make additional efforts to

facilitate acknowledgments. For instance, several States ask the father

to come to the IV-D agency for a conference or hearing where he may

voluntarily acknowledge. The conference allows IV-D staff to explain,

in person, the rights and responsibilities associated with the

establishment of paternity. Designated agency personnel are available

to witness or notarize signatures on voluntary acknowledgments.

If an alleged father refuses or is reluctant to voluntarily

acknowledge paternity, States should encourage genetic testing. Men who

are unsure, but willing to cooperate, will frequently consent to

genetic testing. States could adopt procedures for conducting testing,

if the alleged father consents, prior to a formal filing of an action

to establish paternity with the court or administrative authority. Even

in cases where the man is initially unwilling to voluntarily

acknowledge, he may consent to genetic testing and subsequently

acknowledge paternity if the test results show a high probability of

paternity, without the need for a hearing or formal adjudication.

3. Comment: One commenter requested clarification regarding whether

the opportunity to voluntarily acknowledge could be given either before

or after initiating legal action to establish paternity.

Response: The IV-D agency may meet the requirement at Sec. 303.5(a)

by offering the alleged father the opportunity to acknowledge paternity

at any time--before or after initiating legal action to establish

paternity. To clarify this, we have omitted the phrase ``if he fails to

voluntarily acknowledge paternity'' (which was included in the text of

the proposed Sec. 303.5(a)(2)), since it implied that the IV-D agency

should seek a voluntary acknowledgment before attempting to establish

paternity by legal process. Although we generally encourage States to

offer the alleged father the opportunity to acknowledge before

initiating legal process, we realize that some men will flee or

otherwise avoid service of process if notified of the paternity issue

prior to service.

If a IV-D agency offers the man the opportunity to voluntarily

acknowledge paternity prior to the initiation of legal action, the IV-D

agency may want to inform the alleged father at the time it provides

him an opportunity to acknowledge that formal paternity establishment

action will begin if the alleged father does not acknowledge within a

specified timeframe. On the other hand, a IV-D agency may choose to

combine service of process necessary for a legal paternity

determination with the offer of the opportunity to voluntarily

acknowledge. For example, some States serve a notice or claim of

alleged paternity and support obligation on the putative father,

informing him of the opportunity to voluntarily acknowledge paternity.

If the man fails to voluntarily acknowledge, the State can then

adjudicate paternity based on the initial notice.

Hospital-Based Paternity Establishment Programs--Sections 301.1,

302.70(a)(5)(iii)(A), 303.5 (g) and (h), 304.20(b)(2), and 304.23(d)

a. General Requirement; State Law.

1. Comment: One commenter questioned whether hospital-based

programs would be effective, particularly since mothers of newborns

stay in the hospital for such a short period of time.

Response: Prior to the enactment of OBRA '93, about half of the

States had already developed hospital-based programs to obtain

voluntary acknowledgments of paternity (although often on less than a

statewide basis). Even some hospitals in States without proactive,

organized programs have, for years, accepted voluntary acknowledgments

of paternity from maternity patients and alleged fathers. Typically, in

an organized program, trained hospital employees provide information

about paternity establishment to the parents, inform them of their

rights, and give the putative father the opportunity to voluntarily

acknowledge paternity. Such programs have been quite effective in

obtaining voluntary paternity acknowledgments; some hospital-based

programs have successfully obtained voluntary acknowledgments for about

40 percent of their out-of-wedlock births. In developing these

regulations, OCSE met with officials from established hospital-based

programs in several States.

The experience of States indicates a father of a child born to an

unmarried mother is more likely to be present and to admit paternity

during the time surrounding birth than later on. Early paternity

establishment reduces location difficulties and administrative costs

which can occur if paternity establishment is delayed. The earlier

paternity is established, the sooner the child will have access to the

father's medical benefits, medical history information, a legal

relationship with the father, child support, and other benefits

resulting from paternity establishment.

To address the fact that mothers of newborns stay in the hospital

only a short period of time after birth, States and their hospital-

based programs should attempt to offer paternity acknowledgment

services during peak hospital visiting hours, which may be in the

evening, to ensure that all unmarried parents have the opportunity to

voluntarily acknowledge paternity. In addition, States are encouraged

to provide information on the importance of paternity establishment

prior to the birth of the child (e.g., at prenatal clinics and maternal

and child health programs).

2. Comment: Some commenters expressed concern that the proposed

January 1, 1995 effective date for statewide implementation of the

hospital-based program would be difficult to meet. One commenter

suggested that OCSE provide training and technical assistance to help

States meet this deadline. Commenters pointed out that in a few States

the first legislative session after enactment of OBRA '93 will be in

1995.

Response: With one adjustment, we are keeping the effective dates

as proposed. As required by the Federal statute, States must have laws,

regulations and/or binding procedures required under

302.70(a)(5)(iii)(A) in place on October 1, 1993 (or if legislation is

required, by the beginning of the first calendar quarter after the

close of the first regular session of the State legislature that begins

after August 10, 1993).

Under Sec. 303.5(g)(1), the hospital-based programs must be

operational in birthing hospitals statewide no later than January 1,

1995. Given the increasing number of out-of-wedlock births, we believe

Congress intended these hospital-based programs to be implemented as

quickly as possible, and we cannot justify further delay. Depending on

State circumstances, the January 1, 1995 effective date gives States

over a full year after the Federal mandate's effective date to gear-up

to a statewide program. In the preamble to the proposed rule (58 FR

62599, 62603), we encouraged States to begin implementing their

hospital-based programs immediately, even if a State law had not yet

passed, by contacting hospitals and appropriate agencies and developing

forms, written materials, and training procedures.

However, as commenters pointed out, OCSE cannot impose a regulatory

effective date that is stricter than the statutory one. Therefore, we

have added the phrase ``unless Federal law governing the effective date

gives the State additional time'' to the January 1, 1995 effective date

at Sec. 303.5(g)(1). This phrase only applies to States where: (1) the

end of first regular legislative session beginning after enactment of

OBRA '93 (on August 10, 1993) occurs after January 1, 1995, and (2) the

State legislature needs to pass law regarding the hospital-based

program in order for the State to comply with

Sec. 302.70(a)(5)(iii)(A). A State meeting these conditions will have

until the effective date contained in Federal statute to implement its

hospital-based program statewide. Such a State, however, must have both

its law in place and have its hospital-based program operational

statewide by the Federal statutory effective date. We encourage States

to establish their hospital-based program and mandate participation by

birthing hospitals through regulation or procedure with the full force

and effect of law. However, if enabling State legislation is necessary,

the State can proceed with implementation planning and arrangements

concurrent with consideration of the legislation.

To facilitate the establishment of hospital-based programs, the IV-

D agency may enter into agreements or contracts with birthing hospitals

or other State agencies. (Some type of formal agreement is required in

order to receive FFP for $20 payments per acknowledgment; see

discussion below). A State could also contract with a private entity or

organization to implement the hospital-based program. For purposes of

Title IV-D State plan requirements, the State will still be liable for

ensuring that the required process has been implemented. We encourage

the State to work closely with the State hospital association; State

staff who have implemented existing programs indicate the hospital

association was a key player in implementation.

OCSE is committed to continuing to provide technical assistance to

help States implement hospital-based programs quickly. To date, OCSE

has sponsored a well-attended national conference for State agency

personnel, published and disseminated ``In-Hospital Paternity

Establishment: A Resource Guide'', and run feature stories in its

nationally disseminated periodical, the Child Support Report, all of

which addressed hospital-based program implementation issues.

3. Comment: Two commenters requested that the regulations include

an enforcement mechanism regarding the participation of birthing

hospitals.

Response: The statute did not include a Federal enforcement

mechanism targeted directly at hospitals (such as a link to Medicaid or

Medicare funding), and OCSE does not have the authority to establish

such a mechanism by regulation.

However, a State must meet the hospital-based program requirement

at Sec. 302.70(a)(5)(iii)(A) as a condition of IV-D State plan

approval. Each State's title IV-D plan must be approved for the State

to receive Federal financial participation in the operation of its

Child Support Enforcement program. At a minimum, new

Sec. 302.70(a)(5)(iii)(A) requires State law, regulation, and/or

binding procedure to compel all public and private birthing hospitals

to participate in hospital-based programs as defined in

Sec. 303.5(g)(2). At State option, State law may include an enforcement

mechanism for dealing with noncompliance by hospitals.

4. Comment: In the proposed rule, we suggested defining ``birthing

hospital'' as a hospital that has a licensed obstetric care unit or is

licensed to provide obstetric services, or a licensed birthing center

associated with a hospital. One commenter argued that this proposed

definition was too restrictive and did not account for the variety of

licensing procedures used by States. According to the commenter, at

least one State licenses hospitals generally, not according to whether

they provide birthing services.

Response: We have changed the definition of birthing hospital at

Sec. 301.1 from what was originally proposed. A birthing hospital is

now defined as a hospital that has an obstetric care unit or provides

obstetric services, or a birthing center associated with a hospital. If

a State licenses hospitals according to whether they have obstetric

units or provide obstetric services, or if a State licenses birthing

centers, the State may use the list of licensed entities to determine

in which facilities hospital-based programs should be established.

Since we do not believe programs should be mandated in hospitals

(such as geriatric hospitals) that do not provide maternity services,

we have limited the hospital-based program requirement to hospitals

that either have an obstetric care unit or that provide obstetric

services. In the definition of birthing hospital, we also include

birthing centers associated with a hospital. A birthing center is a

facility physically located outside a hospital that provides maternity

services. Generally, such centers use midwives and provide services for

women who expect no complications during birth. Frequently, a hospital

will provide back-up services to a birthing center if complications

develop. Since in some localities, a significant number of births occur

in birthing centers, we believe voluntary acknowledgment programs

should be established in such centers that are associated with

hospitals.

5. Comment: One commenter asked how the Federal OCSE would monitor

State compliance with the hospital-based program requirements.

Response: Section 454(20) of the Act requires that the State IV-D

plan provide that the State shall have in effect all the laws required

under the mandatory procedures established in section 466 of the Act.

Since the requirements for hospital-based programs are part of the

mandatory procedures set forth in section 466, States must demonstrate

conformity with these requirements as a condition for having an

approved State IV-D plan. As a condition of State plan approval, States

must have a law (or procedure, rule, or regulation with the force of

law) providing for a hospital-based program and requiring that all

public and private birthing hospitals participate in the program in

accordance with Sec. 302.70(a)(5)(iii)(A). In addition, as part of the

State plan approval process, States will be asked to certify that

hospital-based programs are operational in birthing hospitals statewide

no later than January 1, 1995 (unless Federal law governing the

effective date gives the State additional time) in accordance with

Sec. 303.5(g)(1). States failing to demonstrate conformity with these

requirements will be subject to State plan disapproval procedures

outlined in OCSE-AT-86-21. Non-conformity could result in the

suspension of all IV-D funding as well as loss of a portion of title

IV-A funding to the State.

b. Elements of a Hospital-Based Program.

1. Comment: Numerous commenters recommended that Federal hospital-

based program requirements include detailed and specific provisions

regarding due process safeguards and the explanation of rights and

responsibilities. For example, some commenters suggested federally-

mandated training protocols, and safeguards to protect the mother,

particularly in cases involving domestic violence.

Response: As discussed earlier in response to comments, although we

agree with the importance of affording due process and explaining

rights and responsibilities, we have tried to avoid overly prescriptive

Federal requirements that would unnecessarily disrupt or interfere with

the operation of existing, successfully-functioning programs.

However, OCSE is committed, within its available resources, to

offering technical assistance and ``best practices'' regarding forms,

written materials, and training procedures. Moreover, Federal

requirements regarding hospital-based requirements are somewhat more

detailed than the general voluntary acknowledgment requirements, due to

the special conditions, discussed earlier, surrounding hospital-based

programs.

Under Sec. 303.5(g)(2)(i), a hospital-based program must provide to

both the mother and alleged father, if he is present in the hospital:

(A) Written materials about paternity establishment, (B) the forms

necessary to voluntarily acknowledge paternity, (C) a written

description of the rights and responsibilities of acknowledging

paternity, and (D) the opportunity to speak with staff, either by

telephone or in-person, who are trained to clarify information and

answer questions about paternity establishment.

The written materials about paternity establishment can be

brochures, pamphlets, or similar materials that describe the benefits

of paternity establishment and the consequences of a voluntary

acknowledgment. Some States have begun using informational films or

videos, in addition to written materials. The State may want to include

a discussion of the potential impact of an acknowledgment on custody,

visitation, and adoption.

The description of rights and responsibilities may be a separate

document or be included on the other written materials or forms.

However, we encourage States to include the description on the form

itself to serve as proof that notice of the rights and responsibilities

was provided in the event the acknowledgment is later challenged. The

description should list the rights each party is conceding by signing

the acknowledgment. It should also describe the rights and

responsibilities, including the duty to support the child financially,

that each party will assume as a result of signing the acknowledgment.

These rights and responsibilities will vary by State, depending on

State law.

In accordance with Sec. 303.5(g)(5), the State must provide the

written materials, written description of rights and responsibilities,

and acknowledgment forms to the birthing hospitals for distribution.

The materials should be written in clear, easily understandable terms.

The State is responsible for ensuring that birthing hospitals have an

adequate supply of these items to distribute to unmarried mothers and

alleged fathers upon birth of a child. Hospitals already distribute a

variety of materials and forms to patients and can incorporate

paternity materials and forms into their existing distribution

procedures.

Under Sec. 303.5(g)(4), the State must require that a voluntary

acknowledgment obtained through a hospital-based program be signed by

both parents, and that the parents' signatures be authenticated by a

notary or witness(es). Therefore, an acknowledgment of paternity cannot

be made in the hospital unless both the mother and the alleged father

agree to acknowledge the man's paternity. The form used for

acknowledging paternity in a hospital-based program should contain

lines for both parents' signatures and authentication by a notary or

witness(es).

Under Sec. 303.5(g)(2)(iii), a hospital-based program must also

afford any additional due process safeguards necessary under State law,

court rulings, and special circumstances. We encourage States to work

with hospitals to ensure that the voluntary aspect of the program is

promoted and maintained. Neither the mother nor the father should be

pressured into signing acknowledgments.

One way of ensuring that the process remains voluntary is through

training of appropriate personnel. Under Sec. 303.5(g)(6), the State

must provide training, guidance, and written instructions regarding

voluntary acknowledgment of paternity, as necessary to operate the

hospital-based program. States may use classroom sessions, written

instructions or handbooks, audio or video tapes, technical assistance

provided via telephone, or other means to meet this requirement.

Regardless of the method or combination of approaches, the State should

ensure that staff, as they assume the responsibility, are instructed in

the operations of the program. One State with an existing program has

provided formal training every few years, while providing technical

assistance and guidance via telephone and written instructions to

supplement the training sessions. Another State is developing a

videotape for training hospital-based program staff. OCSE plans to

share knowledge of materials and experiences regarding training

protocols and procedures.

Finally, we encourage States to consider other safeguards suggested

by commenters as a means of protecting women in cases potentially

involving domestic violence. These include training workers to

recognize possible domestic violence, and talking with the mother and

alleged father separately so that the mother can raise any concerns

privately and discreetly.

2. Comment: Several commenters objected to the proposed requirement

that a hospital-based program provide to both the mother and alleged

father, if he is present in the hospital, the opportunity, prior to

discharge from the hospital, to speak with staff, either by telephone

or in person, who are trained to clarify information and answer

questions about paternity establishment. The commenters suggested that,

since mothers usually stay in the hospital only a short time after

birth and the alleged father may only appear briefly at the hospital,

it is unrealistic to expect hospital or IV-D workers to be able to talk

with all parents about paternity establishment prior to discharge,

particularly during weekend or evening hours. Some commenters also

expressed concerns about the ability and propriety of hospital workers

to respond to complex legal questions.

Response: In response to commenters, we have not included the

phrase ``prior to discharge'' in the final requirement at

Sec. 303.5(g)(2)(i)(D). Therefore, a hospital-based program must give

parents an opportunity to talk with staff, but not necessarily prior to

discharge. The staff could either be hospital staff (e.g., medical

social workers, medical records technicians, or medical provider

staff), IV-D, or other agency staff. Most existing programs use

hospital staff.

To meet this requirement, a hospital-based program must: (1) Have

staff in the hospital to talk with parents in person, or (2) provide

written materials with a telephone number for State agency (IV-D or

other agency) personnel that the parties may contact for additional

information. A hospital-based program may utilize both of these

approaches.

We encourage hospital-based programs to have staff in the hospitals

available to talk with the parties in person. Each program should make

staff available, especially during evening and weekend visiting hours,

to ensure that all unmarried mothers and alleged fathers present at the

hospital are afforded an opportunity to acknowledge paternity. Notaries

public or witnesses (designated hospital staff in some ongoing

programs), as required under State law, should also be available to

authenticate acknowledgments in the hospital. Staff can answer simple

questions and assist parents in completing the forms. However, as

commenters pointed out, hospital staff may not be able to answer legal

questions regarding paternity establishment. In fact, at least one

existing hospital-based program advises program staff not to answer

legal questions; instead, the parents are given the telephone number of

a State agency to contact. A hospital-based program may also want to

advise parents that, if they have such questions, they should contact a

legal services agency or an attorney.

Some parents may not be able to reach State agency personnel via

telephone, or may not decide to acknowledge, until after discharge from

the hospital. Therefore, we recommend that acknowledgment forms include

clear instructions that allow the parents to complete and mail an

acknowledgment some time after leaving the hospital.

3. Comment: Numerous commenters requested clarification regarding

whether a hospital-based program must seek a voluntary acknowledgment

prior to the birth of a child.

Response: Regulations at Secs. 302.70(a)(5)(iii)(A) and 303.5(g)

require hospital-based programs for the voluntary acknowledgment of

paternity during the period immediately before or after the birth of a

child to an unmarried woman in the hospital. The phrase ``during the

period immediately before or after the birth of a child'' comes from

section 466(a)(5)(C) of the statute. These provisions do not require a

hospital-based program to seek a voluntary acknowledgment prior to the

birth of a child. A hospital-based program should not seek a completed

acknowledgment prior to birth unless State law recognizes the validity

of pre-birth acknowledgments.

However, regardless of whether a State's law recognizes pre-birth

acknowledgments, the period prior to birth offers an opportunity to

inform both parents about the value of paternity establishment and

their rights and responsibilities. Several States have developed

outreach programs in prenatal clinics and other facilities. These

programs give parents the time and knowledge to make an informed

decision, particularly since most mothers only stay a short period of

time in the hospital after giving birth.

4. Comment: Several commenters suggested that genetic testing be

required for all newborns as a means of determining or confirming their

parentage and preventing fraudulent acknowledgments of paternity. Other

commenters recommended expanding the role of hospital-based programs to

include voluntary genetic testing services.

Response: We are not requiring genetic testing for all births as a

means of preventing fraudulent acknowledgments. Under Sec. 303.5(g)(4),

a State must require that a voluntary acknowledgment obtained through a

hospital-based program be signed by both parents, and that the parents'

signatures be authenticated by a notary or witness(es). We believe the

number of cases where both parties would be willing to make a false

claim of paternity is very small. Furthermore, the cost of providing

genetic testing as a condition of acknowledging paternity in all cases

would be significant. Fraudulent acknowledgments could be challenged in

court where genetic tests could, of course, be ordered.

Furthermore, we are not requiring hospital-based programs to offer

the option of genetic testing as part of hospital-based programs. The

statutory requirement for hospital-based programs does not include

genetic testing, and we believe that imposing additional requirements

will make statewide compliance by January 1, 1995 more difficult.

Although not a requirement, we encourage States to incorporate the

opportunity for genetic testing into their hospital-based programs. A

readily available testing capability may persuade additional fathers to

voluntarily acknowledge or expeditiously resolve any doubts as to

paternity. A few States have begun to offer genetic testing in

hospitals. Another State routinely obtains stipulations in the hospital

where both parties agree to undergo genetic testing at a later date.

c. Withholding Services in Some Cases.

1. Comment: Several commenters suggested that a hospital-based

program should not have to provide services in cases where the mother

is considering adoption (even though an adoption is not yet pending) or

is otherwise reluctant to acknowledge the man's paternity.

Response: We have retained the requirement at Sec. 303.5(g)(3) as

proposed. This allows a hospital-based program to withhold services

related to acknowledging paternity, when necessitated by State law, in

cases where the mother or alleged father is a minor or a legal action

(e.g., relinquishment of parental rights for purposes of adoption) is

already pending. Some States may have laws which prohibit voluntary

acknowledgments of paternity by minors, or the State may want hospital-

based personnel to avoid interference in cases where a legal action is

pending. Therefore, the hospital-based program is not required to

provide services to the mother and alleged father in such cases, if

provision of services is prohibited by State law. However, the services

listed in Sec. 303.5(g)(2) should be provided to other unmarried

parents.

Certainly, if a mother is considering adoption (but action is not

yet pending) or, for some other reason, does not want to acknowledge

the man's paternity, she may decline to sign the voluntary

acknowledgment. The in-hospital process is entirely voluntary, and an

acknowledgment obtained through a hospital-based program requires the

signatures of both parents. If the mother does not wish to participate

and declines to identify the father, no further action is required on

the part of the hospital.

2. Comment: One commenter asked how the hospital will find out that

circumstances in a particular situation permit paternity acknowledgment

services to be withheld.

Response: Generally, hospitals will be able to obtain this

information from the patient (if an adoption is pending) or from

hospital records (if a termination of parental rights or other

proceeding is pending). In other cases, hospitals may only learn of the

circumstances after talking with both the mother and alleged father

(e.g., if he is a minor).

3. Comment: Commenters asked if a hospital-based program must

provide services in cases where the parents are not residents of the

State, or in cases involving illegal aliens.

Response: An individual's residency or citizenship status may not

be a basis for excluding the person from an opportunity to acknowledge

paternity. A hospital-based program must provide services to unmarried

parents regardless of whether they are nonresidents or illegal aliens.

Paternity establishment is a service in the best interest of the child

and the residency or citizenship status of the parents does not reduce

the child's interest in having legal paternity established.

d. Annual Assessment.

1. Comment: Several commenters objected to the proposed requirement

mandating an annual assessment of each birthing hospital's program.

Commenters suggested the requirement was overly burdensome, was not

necessary to determine a program's effectiveness, and would require

data that are not readily available. Other commenters suggested that

the intent and requirements of the provision needed clarification.

Response: We retained the assessment requirement in the final

regulation. States must assess each birthing hospital's program on at

least an annual basis. It is essential that a State not only establish

hospital-based program procedures, but also follow-up to determine if

such procedures are working. The intent of this requirement is not to

establish performance quotas or to create pressure for hospitals to

obtain acknowledgments, but rather to ensure that hospitals are

actually operating programs. Staff turnover among hospital personnel or

a depleted supply of forms or materials may disrupt or even suspend a

hospital-based program's operation. The annual assessment will allow

the State to detect whether such problems occur, and to take

appropriate action (periodic staff training, regularly supplying new

forms) to prevent them.

The annual assessment requirement does not mandate a formal

investigation or audit. Rather, it simply requires States to examine

data which, in most States, should be available without the need for a

special data collection. At a minimum, the annual assessment must

examine the number of acknowledgments received from each hospital. If

the State makes payments to the birthing hospitals for each voluntary

acknowledgment obtained, it should already have access to data

regarding the number of acknowledgments per hospital. We encourage the

State to consider the number of acknowledgments as a percentage of the

number of out-of wedlock births during the same period at each

hospital, if data regarding births are available. This percentage will

provide a more accurate measure of a hospital-based program's

operation. Data regarding the number of out-of-wedlock births per

hospital are already collected by vital statistics agencies in some

States.

If the number of acknowledgments received from a hospital seems

unusually low or has declined significantly from the number received in

the past, the State should contact the hospital to determine whether

training or other assistance is needed.

e. Forwarding and Recording Acknowledgments.

1. Comment: We received numerous comments regarding the proposal to

require procedures for filing voluntary acknowledgments with either the

State IV-D agency or a centralized State agency that provides the State

IV-D agency access to copies of, and identifying information on, the

acknowledgments. The proposed rule also would have required the IV-D

agency, in IV-D cases needing paternity establishment, to determine if

a voluntary acknowledgment had been filed with the agency designated by

the State.

Many commenters suggested that, while a central database of

information regarding acknowledgments might be useful, there is little,

if any, benefit in requiring States to file actual copies of

acknowledgments with a central entity. Actual copies may be needed at

the local level by a court or agency, but not at the central or State

level, during support order establishment or other proceedings. The

commenters explained that many States already have procedures for

filing acknowledgments with a local court or agency.

One commenter suggested that we require all voluntary

acknowledgments, not just those obtained through hospital-based

programs, to be filed with a central entity.

Response: We have significantly revised this requirement in light

of comments to the proposed rule. The final regulation, at

Sec. 303.5(g)(2)(iv) requires a hospital-based program to forward

completed acknowledgments or copies to the entity designated under

Sec. 303.5(g)(8). Section 303.5(g)(8) requires the State to designate

an entity to which hospital-based programs must forward completed

voluntary acknowledgments or copies. Under State procedures, this

entity must be responsible for promptly recording identifying

information about the acknowledgments with a statewide database, and

the IV-D agency must have timely access to whatever identifying

information and documentation it needs to determine in accordance with

Sec. 303.5(h) if an acknowledgment has been recorded and to seek a

support order on the basis of a recorded acknowledgment in accordance

with Sec. 303.4(f).

A State's procedures may provide for forwarding acknowledgments or

copies to any entity designated by the State--a local court or agency,

the vital statistics agency, the IV-D agency, or some other entity. We

are not, as one commenter suggested, requiring the designated entity to

be the State's vital statistics agency; we want to avoid unnecessary

interference with States' previously-established procedures. A State

can have more than one designated entity. The designated entity is

responsible for recording identifying information about the

acknowledgments with a statewide database (or, alternatively, for

forwarding the acknowledgments or identifying information to another

entity responsible for recording the identifying information with the

statewide database). No matter what entity a State designates, the

information should be recorded promptly so that necessary information

and documentation will be readily available to the IV-D agency.

The State must have one centralized, statewide database, which may

be automated at State option, that contains identifying information

about acknowledgments. The identifying information must be maintained

in one automated database (if automated) or one central location (if

not automated). The database may be established and maintained by the

State IV-D agency, some other State agency, or a contractor under

agreement with a State agency. If a State's database is maintained by

the IV-D agency, we encourage the IV-D agency to incorporate the

database into its statewide computerized support enforcement system.

The database may be maintained by an agency other than the designated

entity, as long as the designated entity records (or forwards to

another entity for recording) with the statewide database identifying

information about acknowledgments forwarded to the entity. The State

may, at State option, develop procedures for filing or recording actual

copies of acknowledgments, in addition to identifying information, in a

statewide database.

As with the proposed rule (58 FR 62599, 62601), the requirement for

forwarding acknowledgments or copies is limited to hospital-based

programs. (To clarify the applicability of this requirement, we are

including it in the hospital-based program section at Sec. 303.5(g)

rather than in Sec. 302.70 as proposed). We do not have authority to

mandate that persons or entities in non-IV-D cases (except for

hospital-based programs, which are required as a condition of IV-D

State plan approval) adhere to these procedures. Forwarding/recording

procedures are not necessary to link IV-D cases with acknowledgments

obtained through the IV-D program, since the IV-D agency is already

aware of such acknowledgments. However, for purposes of uniformity and

centralized access, we strongly encourage States to expand their

statewide databases to include identifying information on voluntary

acknowledgments obtained from sources other than hospital-based

programs. At State option, procedures for forwarding acknowledgments to

the designated entity may be made available to any party who wishes to

use the procedures. States may want to include instructions for

forwarding the acknowledgment on the acknowledgment form itself. If a

State's vital statistics agency (or similar agency responsible for

birth registration) is the designated entity or maintains the statewide

database of identifying information, the State may choose to link these

forwarding/recording instructions with instructions for adding the

father's name to the birth certificate.

The purpose of these procedures is to ensure that the IV-D agency

has a source for determining, in a IV-D case needing paternity

establishment, whether or not an acknowledgment was obtained outside

the IV-D system (e.g., at the hospital). The IV-D agency should use

such previously-obtained acknowledgments of paternity as the basis for

establishing and enforcing a child support order.

To ensure that voluntary acknowledgments are used in IV-D case

processing, Sec. 303.5(h) compels each IV-D agency to determine, in

cases needing paternity establishment, if identifying information about

a voluntary acknowledgment has been recorded in the statewide database

mandated by Sec. 303.5(g)(8). Once a IV-D agency matches a case with a

voluntary acknowledgment recorded in the statewide database, it must

then use that acknowledgment to seek a support order in IV-D cases.

When attempting to determine if a voluntary acknowledgment of

paternity has previously been completed in a IV-D case needing

paternity establishment, we encourage the IV-D agency to first ask the

custodial parent whether the alleged father voluntarily acknowledged

paternity at the hospital or at some other time. However, unless the

custodial parent is able to provide a copy of the acknowledgment,

asking the custodial parent, by itself, does not satisfy the

requirement at Sec. 303.5(h) under which the IV-D agency must determine

if an acknowledgment has been recorded with the statewide database. A

recent evaluation of one city's hospital-based program found that, in

IV-D cases where a voluntary acknowledgment had previously been

obtained at the hospital, the IV-D agency was not aware of the

acknowledgment in about half of the cases. Custodial parents may be

unable or unwilling to tell the IV-D agency about a voluntary

acknowledgment previously obtained in the hospital. Therefore, a State

must have some other means, either automated or manual, for checking

the records of the statewide database to determine if identifying

information about an acknowledgment has been recorded with the

statewide database. Although we encourage use of automated matching, we

are not requiring such since the records of a State's designated entity

may not be automated and we are not providing Federal financial

participation for the development of a computer system for the

designated entity. Regardless of whether the State uses an automated or

manual process, the IV-D agency must have access to up-to-date

information.

A IV-D agency does not need to determine if a voluntary

acknowledgment has been recorded with the statewide database in a case

where the IV-D agency: (1) Is already aware that an acknowledgment has

been completed and has documentation necessary to seek a support order

on the basis of that acknowledgment; (2) knows that it is unlikely that

an acknowledgment is recorded with the statewide database (e.g., the

child's birth certificate indicates that the child was born in another

State); or (3) does not have sufficient information to make a

determination. In a case where a child was born in another State, the

IV-D agency may check with the other State to determine if identifying

information about an acknowledgment has been recorded. With respect to

situations where sufficient information is lacking, we encourage the

IV-D agency to search for an acknowledgment under the child's name if

the custodial parent fails to provide the name of an alleged father.

Failure of the custodial parent to provide the name of an alleged

father is not a sufficient basis, by itself, for deciding not to

determine if an acknowledgment has been recorded.

Under State procedures, the IV-D agency must have timely access to

whatever identifying information and documentation it needs, in a IV-D

case, to determine in accordance with Sec. 303.5(h) if an

acknowledgment has been recorded in the statewide database and to seek

a child support order on the basis of a recorded acknowledgment in

accordance with Sec. 303.4(f). This identifying information must

include sufficient information to enable the IV-D agency to determine

if an acknowledgment recorded in the statewide database matches a IV-D

case needing paternity establishment--for example, names and social

security numbers.

Concerning documentation, in some States, the IV-D agency may need

the original acknowledgment or an authenticated copy in order to

establish a support order on the basis of the recorded acknowledgment.

If this is the case, in order to satisfy Sec. 303.5(g)(8), under which

the IV-D agency must have timely access to necessary information and

documentation, the State may need procedures under which some entity

(perhaps the entity designated to receive acknowledgments or copies

from hospital-based programs under Sec. 303.5(g)(8)) maintains

acknowledgments and gives the IV-D agency access to acknowledgments or

copies. Identifying information in the statewide database should

indicate the location where an acknowledgment or copy is maintained, if

such information is necessary.

If necessary, the IV-D agency should enter into agreements with:

(1) The agency responsible for maintaining the statewide database (in

order to obtain identifying information about acknowledgments recorded

in the database), and (2) the entity that maintains the acknowledgments

(in order to obtain authenticated copies). If allowable under State

law, a State may also choose to give other agencies, besides the IV-D

agency, access to the statewide database (e.g., agencies which need the

records to establish benefit claims, such as Social Security).

2. Comment: Several commenters requested that Federal financial

participation (FFP) be available for costs associated with filing

copies of acknowledgments with entities such as vital statistics

agencies. One commenter asked whether 90 percent enhanced funding would

be available for automated systems changes associated with filing

procedures.

Response: FFP is available for three related costs. First, under

Sec. 304.20(b)(2)(i), which allows FFP for costs associated with

reasonable efforts to determine the identity of a child's father, FFP

is available for the IV-D agency's costs in determining, in accordance

with Sec. 303.5(h), whether a voluntary acknowledgment has been

recorded with the statewide database in IV-D cases needing paternity

establishment. Second, FFP is available for reasonable and necessary

costs, including fees, incurred by the IV-D agency in obtaining copies

from an entity of documents such as voluntary acknowledgments or birth

certificates. Third, FFP is available, under previously-existing

policy, for the IV-D agency's costs incurred under an agreement,

including the IV-D agency's costs of establishing an agreement,

governing the routine exchange of information or documents regarding

acknowledgments, between the IV-D agency and the designated entity

(required by Sec. 303.5(g)(8)), the agency that maintains the statewide

database, or any entity that gives the IV-D agency access to copies of

acknowledgments (if such an agreement is necessary).

However, FFP is not available for the costs of establishing,

maintaining, or operating the designated entity (required under

Sec. 303.5(g)(8)) or any entity where copies of acknowledgments are

filed or maintained, unless that entity is theP IV-D agency. Similarly,

FFP is not available for the costs of establishing, maintaining, or

operating the statewide database of identifying information about

voluntary acknowledgments, unless the agency that maintains that

database is the IV-D agency.

In addition, if a State needs to make changes to its IV-D statewide

automated system in order to accommodate these new voluntary

acknowledgment requirements (or other requirements in this rule),

enhanced FFP is available for automated systems until September 30,

1995. If changes are required after that date, regular FFP is

available.

3. Comment: We received several comments urging us to require that

the State add the father's name to the child's birth certificate once

the father acknowledges paternity.

Response: Although we encourage such procedures and encourage

States to consider any changes in law or procedure to facilitate this

outcome as part of their implementation of OBRA '93 requirements, we

have no authority to regulate State birth registration procedures. If a

State chooses its vital statistics agency (or similar agency

responsible for birth registration) as the designated entity or the

agency responsible for its statewide database of identifying

information on acknowledgments (required under Sec. 303.5(g)(8)), the

State may want to link the forwarding/recording process with procedures

for including the father's name on the birth certificate if an

acknowledgment is sufficient basis for including the father's name on

the certificate under State law. If a State's acknowledgment form

includes the social security numbers of the parents, the recording of

voluntary acknowledgments with a vital statistics agency may also be a

way of obtaining social security numbers from parents as required

during the birth registration process by section 205(c)(2)(C)(ii) of

the Social Security Act.

4. Comment: Some commenters requested that we prohibit filing

agencies (such as vital statistics agencies or courts) from charging

the State IV-D agency or IV-D agencies in other States fees for

obtaining copies of voluntary acknowledgments or other records.

Response: We do not have the authority to issue regulations

forbidding State entities from charging fees for records.

However, as mentioned above, Federal financial participation is

available for reasonable and necessary costs, including fees, incurred

by the IV-D agency in obtaining from an entity copies of documents such

as voluntary acknowledgments or birth certificates.

5. Comment: One commenter suggested that we mandate a system for

officially recording and documenting genetic test results which create

a presumption of paternity.

Response: We do not think such a system is necessary. Most genetic

testing takes place in the context of ongoing action to establish

paternity. Once genetic test results either exclude an alleged father,

create a presumption of paternity, or reflect inclusionary findings not

rising to the level of a presumption, the action will move to the next

step in the process. By contrast, a database of voluntary

acknowledgments is needed since a large number of acknowledgments are

obtained outside of an ongoing paternity/support order establishment

process (e.g., in hospital-based programs).

f. FFP Availability for Hospital-Based Programs.

1. Comment: Numerous commenters requested that Federal financial

participation (FFP) for hospital-based programs be expanded to cover

additional costs, including the costs of hospital staff; travel for

hospital staff attending training sessions; notaries; and other

operating costs. Other commenters suggested that FFP availability

should be extended to schools, WIC agencies, town clerks, and other

agencies that might provide voluntary acknowledgment services.

Response: FFP is available for certain costs associated with

hospital-based programs. First, under previously-existing policy, FFP

is available for the IV-D agency's costs incurred under necessary

agreements between the IV-D agency and birthing hospitals or other

State agencies, including the IV-D agency's costs of establishing such

agreements. Second, FFP is available for IV-D staff that work on

developing and implementing (e.g., training, drafting materials,

meeting with hospital officials) the hospital-based program.

Third, under new Sec. 304.20(b)(2)(vi), FFP is available for

payments of $20 or less actually made to birthing hospitals for each

voluntary acknowledgment obtained through a hospital-based program as

defined by Sec. 303.5(g)(2). Several States have found such payments to

be successful in obtaining the cooperation of hospitals. The $20 per

voluntary acknowledgment is also available for voluntary

acknowledgments obtained in other entities that provide prenatal or

birthing services. In order for payments to be eligible for FFP, the

birthing hospital or other entity must, however, have a formal

agreement with the IV-D agency. States are not required to provide

payments to hospitals.

Fourth, Sec. 304.20(b)(2)(vii) makes FFP available for the costs of

developing and providing to birthing hospitals and other entities that

provide prenatal or birthing services written and audiovisual materials

about paternity establishment and forms necessary to voluntarily

acknowledge paternity.

Fi

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