Spending for collection of child support by counties will decline by $12.5 million in the 2011-13 biennium. Because counties are being squeezed fiscally from all directions, it’s highly unlikely that they will be able to offset the substantial budget cut. Milwaukee County alone estimated that it would have to cut 38 workers in 2012, or 28 percent of its current child support staff.
The $12.5 million drop in combined state and federal funding for child support enforcement could reduce collections by about $85 million over the next two years, if the decline in collections is proportionate to the fall in spending for enforcement activities. As counties reduce their child support enforcement activities, their performance will almost certainly decline, and that is likely to reduce future federal performance-based incentive payments, causing a downward spiral in child support enforcement.The cut in funding to counties for child support enforcement results from a change in federal funding that began to affect states several years ago. The state provided additional funding to mitigate part of the loss of federal dollars, but that state appropriation terminates at the end of 2011. (Because the 2011 funding was not a permanent appropriation, it is not counted as part of the base funding level, so the reduction in funding that counties will begin to experience next January isn’t technically a cut to the base.)
Money spent on child support enforcement has a great return on the investment. Each additional state dollar spent for child support leverages almost $2 in federal matching funds – for a total of $2.94 for each state GPR dollar. According to the Legislative Fiscal Bureau (Issue Paper #226), child support agencies brought in an average of $6.82 in child support for each dollar of state or federal funding expended in 2009. Based on those figures, each dollar of state GPR funding invested in child support enforcement generates an average of about $20 in child support collected (i.e., $2.94 x 6.82, which assumes that the 2009 ratio of $6.82 per dollar spent is maintained).
The sharp drop in funding for child support collection could have been avoided by taking a more balanced approach to close the state’s budget deficit, such as the “Wisconsin Values” budget recommended by a broad range of state groups.
Because child support enforcement funding yields such a high return on the state’s investment, restoring the funds being cut in the 2011-13 should be a very high priority for policymakers during the next biennium, if not before then.
Jon Peacock
Tomorrow—Way #26: Waiting Period for Unemployment Benefits
About the series: “31 Ways in 31 Days” is a series of posts to the WCCF blog exploring the recently-passed biennial budget’s impact on children and families in Wisconsin. Each day in July, we are posting a description of one way the budget will affect kids and families, with an eye toward what should be done going forward to help improve outcomes and move us closer to the goal of making Wisconsin a place where every child has the opportunity to grow up, learn, and thrive in a safe, healthy, economically secure home and community.
