Family Law Section Efforts
DWD Means To Collect Past-Due Child Support

Administrative Enforcement:
A New Tool to Collect Support Arrears

By Margaret Wrenn Hickey

Editor's Note: To view Wisconsin statutory materials referenced in this article you must have and/or install Adobe Acrobat Reader 3.0 on your computer.

This legislation was introduced originally as Assembly Bill 651 to effectuate the requirements of a federal law known as PRWORA - the Personal Responsibility and Work Opportunity Reconciliation Act of 1996.¹ PRWORA also made changes to the law concerning establishment of paternity, which is not discussed in this article. The bill as passed is 1997 Wisconsin Act 191 (the Act).

Effect on professional and recreational licenses

The Act amends the Wisconsin laws to permit a licensing board or agency to refuse to issue, revoke, deny the renewal of, limit, or suspend almost all types of licenses including professional licenses and recreational licenses.²The licenses include, but are not limited to driver's licenses, almost all professional and occupational licenses, fishing and hunting licenses, and many others. The license holder or applicant will be subject to the law if he or she is delinquent in making court ordered payments of child support, family support, maintenance, birth, medical or other expenses related to child or spousal support, or fails to comply, after appropriate notice, with a subpoena or warrant relating to paternity or child support proceedings.

This new system requires the Department of Workforce Development (the department or DWD), which is in charge of collecting child support including arrears, to enter into a memorandum of understanding with the licensing agencies, with the Wisconsin Supreme Court for law licenses, and with the Lac du Flambeau Band, to determine the circumstances and procedures under which a license may be revoked, suspended, denied, or limited.³ The suspension or limitation may not exceed five years for a delinquency in paying support or six months for failure to comply with a subpoena or warrant.⁴

Certainly, the practice of suspending, revoking, or refusing to renew a driver's license or a professional license, such as a license to cut hair or practice law, would seem counter-productive to the desire to collect child support. As the accompanying article indicates, the State Bar of Wisconsin Family Law Section Board of Directors made many efforts to modify this law, with some success. The DWD has issued a proposed administrative rule, DWD 43, to define when a license may be suspended, denied, or limited. Under the proposed rule, the threshold for such action occurs when 300 percent of the monthly support amount is overdue.⁵

Before the DWD can certify to a licensing agency or board that a payer is delinquent, the department or child support agency must notify the payer, by regular mail at his or her last known address, that this certification will occur.⁶ The notice must contain information that: the certification will occur and when it will occur; upon certification and for up to five years, the license or credential may be revoked or limited, etc.; any license the individual holds may be affected; an occupational license may be available; the certification will not be made if the individual pays the delinquency in full or makes alternative payment arrangements; and the payer may make a written request to the court that made the original support order or judgment, with a copy to the child support agency, for a hearing within 20 business days of the notice.⁷

If the payer requests a hearing, it must be scheduled within 10 business days after receiving the request.⁸ The only issues that may be considered at the hearing are whether the child support arrearage is owed and whether the alternative payment plan proposed by the department or agency is reasonable.⁹If the court determines that the proposed repayment plan is not reasonable, it may impose its own alternative payment plan.¹⁰ If such an order is made, the payer's name may not be placed on the certification list. If no hearing is requested, the result of the hearing is adverse to the payer, or the payer does not comply with the court's payment plan, then the payer's name must be placed on the list.¹¹ A second similar notice then must be sent to the payer stating among other things that the individual's name has been placed on the list, at which time the payer again has 20 business days to request a hearing.¹² If no hearing is requested or the hearing result is adverse to the payer, then the license sanctions will apply.

Clearly, the payer must take heed of the initial notices to avoid what may become a snowball effect of administrative enforcement procedures. If the administrative procedure to revoke, suspend, limit, or refuse a license is enforced, the payer may not be able to engage in the livelihood from which he or she derives the income to pay support, including arrears.

Administrative procedures to seize property

To proceed with the administrative procedures to seize property, the DWD must notify the delinquent payer that he or she will be placed on a list known as a lien docket. Those individuals whose names appear on the lien docket will be subject to the new enforcement procedures, including levies against financial accounts and liens against personal and real property. A person will be listed on the lien docket under the proposed DWD rule when the "lien eligible amount" in one or more of the payer's court cases equals or exceeds the "lien threshold."¹³ An individual will receive notice by regular mail that he or she will be listed on the lien docket. That payer will have the right to make a written request for a hearing within 20 business days of receiving that notice.¹⁴ If a hearing is not requested, the person's name will be placed on the lien docket.

The "lien eligible amount" is defined as "the amount in a court case that is eligible to be placed on the lien docket."¹⁵ In most cases the lien eligible amount is the arrearage amount less the current monthly support charge, if any.¹⁶ The "lien threshold" will vary depending upon whether the department chooses to seize a bank account, put a lien on property, or take another action. In most cases the lien threshold will be met, and the payer's name will be placed on the lien docket, if the arrearage owed equals or exceeds the monthly amount due or $500, whichever is greater.¹⁷

If a payer receives notice that his or her name will be placed on the lien docket, the payer should immediately request a hearing - especially if the payer disputes the arrearage amount. Once on the lien docket, the state has a myriad of mechanisms available to it to seize the payer's property. In some instances, such as for financial accounts, the department is permitted to seize first and notify the payer later.

Notices to be sent by mail. The notices may be mailed to the payer's last known "verified" mailing address as provided by the payer pursuant to section 767.263(2) of the Wisconsin Statutes. The rule requires that the department use due diligence to obtain the payer's address if the mailed notice is returned.¹⁸ If the last known mailing address is "unverified," which term is not defined in the rule, or a written notice sent to a payer's last known verified mailing address is returned, then the department must contact the postmaster to attempt to verify the mailing address.¹⁹ If the postmaster cannot verify the last known mailing address or provide a new address, the department is permitted to send notice to the payer's current employer as provided by the payer.²⁰ If the notice sent to the last known employer is returned, then the department "shall use diligent effort to obtain a mailing address for the payer."²¹

The proposed administrative rule defines diligent effort for each of the administrative enforcement actions. The department must contact the relevant financial institution or agency, if there is one, or the state licensing agency or board in a case involving a license action, to attempt to verify the payer's address. In addition, under some circumstances the department or agency must use the automated federal, state, and local locate resources to obtain the payer's current mailing address.²²

Threshholds for administrative action

After the payer is on the lien docket, if the department chooses to use an action to seize property, it may proceed administratively to seize the payer's bank accounts, personal property or real property, or intercept lump sum settlement, judgment, or pension payments.²³ An arrears threshold applies to begin each type of administrative enforcement action. For financial accounts, the threshold for an action to levy is 300 percent of the monthly amount due or $1,000, whichever is greater.²⁴ For real and personal property, the threshold amount is an arrearage (lien amount) that equals or exceeds 600 percent of the monthly amount due.²⁵ In each of these cases, the amount due for percentage or combined percentage and fixed amount support orders is the amount that is expected each month under the order or judgment. It will be very important for attorneys to establish the expected monthly amount of a percentage or combined percentage and fixed amount order at the time of the initial order or judgment. For lump sum payments the threshold is met when the payer is placed on the lien docket.²⁶

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