Feds fine Ohio $43.4m over child welfare system woes

Feds fine Ohio $43.4m over child welfare system woes

BY DONNA YOUNG | GCN STAFF

Ohio Gov. Bob Taft has a multimillion dollar problem.

The state's $300 million automated child support enforcement tracking system is overdue for certification, resulting so far in $43.4 million in federal fines. Because of the system's operational problems, a child advocate organization and a group of angry parents are suing the state. And Ohio owes millions in collected child support to thousands of parents.

The Support Enforcement Tracking System, or SETS, processes child support data for all of Ohio's 88 counties. Problems in getting it up and running have prompted state officials to change the types of contracts they award for information technology systems.

SETS was intended to help custodial parents get court-ordered child support payments by tracking down delinquent parents. But it has been afflicted with problems from the start, and now Ohio must pay another $7.4 million for repairs to keep it going until June.

Melanie Snider, attorney for the Association for Children for Enforcement of Support Inc. (ACES), a nonprofit child advocate group that is suing Taft and the state, said Ohio is holding $19 million that belongs to its children.

'While the state wastes millions of dollars on this computer system, I have families waiting to get a few dollars owed to them to buy bread and milk for their kids,' Snider said.

Taft's Jobs and Families Department director, Jacqueline Romer-Sensky, who oversaw one of the largest agencies in the state, resigned in March under mounting pressure about SETS' problems. Taft recruited former Ohio House Speaker JoAnn Davidson to fill in until he finds a replacement. But Davidson has committed to stay only two months. Davidson declined to comment on SETS.

Hundreds of calls

Sen. Mark Mallory said his office has received hundreds of calls from parents about the problems with the state's system, including calls from absent parents who have been paying child support but have wrongly received delinquent notices from the state.


Sen. Mark Mallory says his office has received hundreds of calls from parents about the problems with the state's system, including calls from parents who have been paying child support but have wrongly received delinquent notices.
The Family Support Act of 1988 required states to automate child support enforcement by 1997. Ohio and four other states have yet to comply.

The State and Tribal Systems Division of the Administration for Children and Families, the federal agency that certifies automated support enforcement systems, is reviewing the programs in Ohio, Nebraska and Nevada, agency spokesman David Siegel said. California and Michigan also missed the 1997 deadline.

Ohio awarded contracts in 1995 to American Management Systems Inc. of Fairfax, Va., Complete Business Solutions of Farmington Hills, Mich., and Keane Inc. of Dublin, Ohio, to build and maintain SETS. But as of April 1998, six months past the federal deadline, the state's IBM DB2 child support database was operating only on a limited basis, federal officials said.

The federal government fined Ohio $5.2 million in 1998 and another $9.4 million in 1999. By last year, the system still did not meet all requirements and the state was penalized another $28.8 million. If Ohio fails again to meet the requirements, it faces more federal fines.

As part of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), the federal government established a national new-hire and wage reporting system, making it easier for states to find deadbeat parents.

The 1996 welfare reform law also changed the way states distribute child support collected for families receiving assistance under the Temporary Assistance for Needy Families (TANF) program. Before 1996, states kept child support collected for families receiving cash assistance as a reimbursement for welfare.

But federal welfare reform changed that. Each state had to choose whether to fully implement welfare reform by October 1997 under Plan A, or wait until October 2000 and use Plan B.

The law required states to ensure that by the deadlines, their systems would calculate the correct amount of child support for families moving from welfare to work. States could keep payments as a reimbursement only after the families received the child support funds owed them.

Geraldine Jensen, ACES president and founder, said Ohio originally chose Plan A. But, she said, Ohio now claims it is a Plan B state and as such was entitled to keep child support it collected for families that had received TANF assistance through October 2000.

'Because of our suit, the governor has come out and said he will make sure these families are reimbursed back to 1997, but now his attorneys are saying that they will only reimburse the kids since last October,' Jensen said.

Conflicting calculations

Greg Jackson, Ohio's chief information officer, said the matter is a calculation problem rather than a systems problem.

'Before all of the counties moved to one state system, they all had ways of calculating the amounts of child support former welfare families received,' he said. 'When all of the counties moved to the state system in October, the way the state calculated amounts was different than the way counties were calculating.'


Ohio CIO Greg Jackson says the situation is a calculation problem, not a systems problem.
But, Snider said, families that were never on welfare and not involved in the calculation process have been receiving incorrect amounts of support or none at all, even though the state has collected the payments.

Jackson added that the extra $7.4 million payment that the state's Control Board recently approved to keep the vendors working until June is also a result of calculation problems.

'Everyone underestimated the amounts of transactions involved when they designed the system,' he said. 'Things started to get off track when the vendors had to use their time and resources to fix the calculation problems. And because their contract was a time and materials contract, they were having to use funds allocated for other purposes and that made them short toward the end.'

Jackson said Ohio missed the 1997 deadline partly because of the type of contract it had with its vendors.

'The state shouldered most of the burden with a time and materials contract,' he said. 'We will be moving to a quarterly deliverable contract. This type of contract will shift more of the burden to the vendor.'

Jackson said that if the state had used a quarterly deliverable contract in 1995 with AMS and the other SETS vendors, more of the burden of meeting the deadline would have fallen on the vendors. Jobs and Families will use the new contract method first and if it succeeds, Ohio will adopt it for all agencies, he added.

Taft appointed Jackson to the Jobs and Family Services Management Review Team he established after several state legislators had complained about SETS.

Jackson said Ohio is overhauling its IT management structure for Jobs and Families and creating new positions to oversee systems.

'We have had too much reliance on the vendor and not enough participation from the state,' he said. 'The SETS project was totally vendor-led.'

But one contractor said the state has been closely involved in the SETS project, acting as the systems integrator.

'The department is leading systems integration and strategic management,' said Anne Burt, senior principal at AMS, adding that 'the client is taking a much larger role in project management than is ususally the case.'

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