2010 Pennsylvania Code
Title 23 - DOMESTIC RELATIONS
Chapter 43 - Support Matters Generally
4374 - State disbursement unit.

     § 4374.  State disbursement unit.
        (a)  Establishment.--The department shall establish and
     operate a State disbursement unit for collection and
     disbursement of payments on child support orders consistent with
     Federal law. The State disbursement unit shall also monitor
     support orders for enforcement action consistent with Federal
     law. At the option of the department, the domestic relations
     sections may be linked into the State disbursement unit and
     perform some or all of the functions thereof.
        (b)  Collections and disbursements.--The department may
     require that such collections and disbursements of support as
     the department may specify, including those related to persons
     not receiving public assistance, be processed through the State
     disbursement unit.
            (1)  The State disbursement unit shall use automated
        procedures, electronic processes and computer technology to
        the maximum extent feasible, efficient and economical for the
        collection and disbursement of support payments.
            (2)  If an employer is ordered to withhold income from
        more than one obligor to pay child support and employs 15 or
        more persons, the employer shall make payments to the State
        disbursement unit through electronic payment methods.
            (3)  If an employer has a history of two or more checks
        returned for nonsufficient funds, the employer shall make
        payments to the State disbursement unit through electronic
        funds transfer.
            (4)  An employer that is not required to make payments to
        the State disbursement unit in accordance with this
        subsection may voluntarily remit support payments through
        electronic funds transfer to the State disbursement unit.
        (b.1)  Penalty.--The department may impose a civil penalty of
     up to $1,000 per violation, following notice and hearing, upon
     an employer who willfully fails to comply with the electronic
     funds transfer payment provisions of this section.
        (c)  Allocation of collections.--Subject to subsections (d),
     (e), (f) and (f.1), support collected on behalf of a family
     shall be distributed as follows:
            (1)  In the case of a family receiving cash assistance
        from the Commonwealth:
                (i)  First, from the amount of current support
            collected, pass through to the assistance group the first
            $100 per month for one child or the first $200 per month
            for two or more children or the first $50 per month for
            spousal support, without decreasing the amount of cash
            assistance, provided, however, that in no event may any
            assistance group be paid more than one support pass-
            through payment per month.
                (ii)  Second, calculate the Federal Government's
            share of the remaining amount collected.
                (iii)  Third, pay the Federal Government's share and
            retain the remainder of the amount collected to reimburse
            the Commonwealth until the amount equals the amount of
            unreimbursed cash assistance paid to the assistance
            group.
                (iv)  Fourth, pay to the assistance group any amounts
            collected in excess of the amounts distributed or
            retained under subparagraphs (i), (ii) and (iii).
            (2)  In the case of a family that formerly received cash
        assistance from the Commonwealth:
                (i)  first, pay to the family the current support
            collected that does not exceed the court-ordered amount
            to be paid in the month; and
                (ii)  second, treat amounts collected in excess of
            the current support collected as arrearages and
            distribute as follows:
                    (A)  In the case of arrearages that accrued after
                the family ceased to receive cash assistance from the
                Commonwealth and which are collected after October 1,
                1998:
                        (I)  first, pay the family up to the amount
                    of arrearages that accrued after the family
                    ceased to receive cash assistance from the
                    Commonwealth;
                        (II)  second, treat the balance as
                    reimbursement of assistance in an amount not to
                    exceed the total amount of unreimbursed cash
                    assistance paid to the family and:
                            (a)  pay an amount equal to the Federal
                        share of the reimbursed amount to the Federal
                        Government; and
                            (b)  retain for the Commonwealth an
                        amount equal to the non-Federal share of the
                        reimbursed amount; and
                        (III)  third, pay any remaining amount to the
                    family.
                    (C)  In the case of arrearages that accrued
                before the family received cash assistance from the
                Commonwealth and which are collected after October 1,
                1998:
                        (I)  first, pay to the family up to the
                    amount of arrearages that accrued before the
                    family began to receive cash assistance from the
                    Commonwealth;
                        (II)  second, treat the balance as
                    reimbursement of assistance in an amount not to
                    exceed the total amount of unreimbursed cash
                    assistance paid to the family and:
                            (a)  pay an amount equal to the Federal
                        share of the reimbursed amount to the Federal
                        Government; and
                            (b)  retain for the Commonwealth an
                        amount equal to the non-Federal share of the
                        reimbursed amount; and
                        (III)  third, pay any remaining amount to the
                    family.
                    (D)  In the case of arrearages that accrued while
                the family received cash assistance from the
                Commonwealth:
                        (I)  first, treat the amount collected as
                    reimbursement of assistance in an amount not to
                    exceed the total amount of unreimbursed cash
                    assistance paid to the family and:
                            (a)  pay an amount equal to the Federal
                        share of the reimbursed amount to the Federal
                        Government; and
                            (b)  retain for the Commonwealth an
                        amount equal to the non-Federal share of the
                        reimbursed amount; and
                        (II)  second, pay any remaining amount to the
                    family.
                    (E)  Notwithstanding clauses (A) through (C), the
                right to any support obligation assigned to the
                Commonwealth as a condition of receiving cash
                assistance in effect on September 30, 1997, shall
                remain assigned after that date.
                    (F)  Except for amounts assigned to the
                Commonwealth under subsection (d), beginning October
                1, 1998, any support arrearages collected shall be
                credited as follows:
                        (I)  first, to the period after the family
                    ceased to receive assistance;
                        (II)  second, to the period before the family
                    received assistance; and
                        (III)  third, to the period during which the
                    family received assistance.
            (3)  In the case of a family that never received cash
        assistance from the Commonwealth, all support collections
        shall be paid to the family with the exception of the
        federally mandated $25 annual fee collected from the
        custodial parent as required under section 4351(a.1)
        (relating to costs and fees).
        (d)  Retention by Commonwealth.--
            (1)  Arrearages collected through use of the Internal
        Revenue Service Tax Refund Offset Program for a family
        receiving cash assistance shall be retained by the
        Commonwealth to the extent past due support has been assigned
        to the department as a condition of receiving assistance.
        Arrearages collected through use of the Internal Revenue
        Service Tax Refund Offset Program for a family that formerly
        received cash assistance shall first be applied to the
        monthly support obligation, and the balance shall be applied
        to arrears owed the family, including assignments of
        arrearages that accrued before the family received assistance
        from the Commonwealth and that were executed between October
        1, 1997, and September 30, 2009. Any remaining arrearages
        shall be paid to the department. The department shall pay to
        the Federal Government the Federal share of the amounts so
        retained. In no event shall the total of amounts paid to the
        Federal Government and retained by the department exceed the
        total of the amount of cash assistance paid to the family by
        the Commonwealth. To the extent that the amounts collected
        exceed the amount retained, the department shall pay the
        excess to the family.
            (2)  Notwithstanding any other provision of law, the
        federally mandated $25 annual fee collected from the
        custodial parent as required under section 4351(a.1) shall be
        retained by the department.
        (e)  Child support, foster care children.--Notwithstanding
     the preceding provisions of this section, amounts collected by
     the department as child support for months in any period on
     behalf of a child for whom a public agency is making foster care
     maintenance payments under Part E of the Social Security Act (49
     Stat. 620, 42 U.S.C. § 301 et seq.) shall:
            (1)  be retained by the department to the extent
        necessary to reimburse the Commonwealth for foster care
        maintenance payments made with respect to the child during
        such period, with appropriate reimbursement to the Federal
        Government to the extent of its financial participation;
            (2)  be paid to the public agency responsible for
        supervising the placement of the child to the extent that the
        amounts collected exceed the foster care maintenance payments
        made with respect to the child during such periods but not
        the amounts required by a court or administrative order to be
        paid as support on behalf of the child during such period,
        and the responsible agency may use the payment in the manner
        it determines will serve the best interests of the child,
        including setting such payments aside for the child's future
        needs or making all or part thereof available to the person
        responsible for meeting the child's day-to-day needs; and
            (3)  be retained by the department if any portion of the
        amounts collected remains after making the payments required
        under paragraphs (1) and (2), to the extent that such portion
        is necessary to reimburse the Commonwealth for any past
        foster care maintenance payments or payments of cash
        assistance which were made with respect to the child and with
        respect to which past collections have not previously been
        retained.
     Any balance shall be paid to the Commonwealth agency responsible
     for supervising the placement of the child for use by such
     agency in accordance with paragraph (2).
        (f)  Modification of distribution rules.--Notwithstanding any
     other provision of law, the department may modify the foregoing
     distribution rules when necessary to comply with Federal law.
        (f.1)  Distribution.--Notwithstanding any other provision of
     law, all child support arrears collected prior to October 1,
     1998, shall be distributed in accordance with department
     procedures applying all of the provisions except subsection
     (b)(1) of section 457 of the Social Security Act (49 Stat. 620,
     42 U.S.C. § 657) as in effect on August 21, 1996.
        (g)  Definitions.--The following words and phrases when used
     in this section shall have the meanings given to them in this
     subsection unless the context clearly indicates otherwise:
        "Assistance group."  The term shall have the meaning given in
     section 402 of the act of June 13, 1967 (P.L.31, No.21), known
     as the Public Welfare Code.
        "Family."  The term shall include the child for whom support
     is received, the custodial parent living with the child and any
     other person in the same assistance group as the child.
     (Dec. 15, 1998, P.L.963, No.127, eff. imd.; July 7, 2006,
     P.L.1055, No.109, eff. 60 days; May 13, 2008, P.L.144, No.16)

        2008 Amendment.  Act 16 amended subsecs. (c) and (d),
     effective October 1, 2008, as to subsecs. (c)(1) and (d)(1) and
     immediately as to the remainder of subsecs. (c) and (d). Section
     5 of Act 16 provided that the amendment of subsec. (c)(3) shall
     apply retroactively to March 31, 2008.
        2006 Amendment.  Act 109 amended subsec. (b) and added
     subsec. (b.1).
        1998 Amendment.  Act 127 amended subsec. (c) and added
     subsec. (f.1). Section 14 of Act 127 provided that the amendment
     of section 4374 shall apply to all child support arrears
     collected on or after October 1, 1998. Act 127 of 1998 was
     suspended by Pennsylvania Rule of Civil Procedure No.
     1910.50(3), as amended May 31, 2000, insofar as it is
     inconsistent with Rule No.1910.20 relating to the availability
     of remedies for collection of past due and overdue support.
        Cross References.  Section 4374 is referred to in section
     4302 of this title.