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New $25.00 Yearly Fee

Feds to get cut of Michigan child support checks

Friday, August 15, 2008
By Kyla King
The Grand Rapids Press

 

Starting next month, some parents who receive child support checks will see an annual fee of $25 taken out of their checks as part of a new federal law.

The change -- which was outlined in a recent letter sent to custodial parents by the state's child support office -- is expected to net nearly $3 million a year. Most of that money will be sent to the federal government to reduce its budget deficit.

The fee applies only if the parent does not receive food stamps for a child, does not and never has received cash assistance, and has received at least $500 in child support, said Marilyn Stephen, director of the Department of Human Services' Office of Child Support.

And Stephen said state officials are grateful the federal legislation allows an exception for families in poverty.

"We have no choice but to abide by the federal law," she said.

But one Rockford mother said she is annoyed the federal government is taking money from kids.

LuAnne Finlayson said, even though it will not be a hardship to have the fee taken out of the child support payments she receives for her daughter, she objects on principle.

"Why is this coming out of the mouths of babes to pay the federal deficit?" Finlayson said. "I think the whole thing is an outrage."

Finlayson said she also is upset with state officials because the federal legislation gives different options for collecting the fee, but Michigan has chosen to withhold funds intended for kids instead of collecting it from the non-custodial parent or paying it directly out of the general fund.

But Colleen Steinman, a spokeswoman for the state human services department, said how each state chooses to pay the fee depends on how it operates its child support payment system.

In Michigan, the change required legislative action. "The Michigan legislators determined that it would be handled in this way," she said. The fee potentially affects about 240,000 cases of the state's 700,000 cases, Stephen said.

About $16 of each $25 collected will be sent to the federal government. The remainder will be funneled into the state's child support program.

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