STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Petitioner, )

)

vs. ) CASE NO. 86-2427

)

BERNARD GROSS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in the above case before the Division of Administrative Hearings by its duly designated Hearing Officer, Donald R. Alexander, on October 3, 1986, in Coral Gables, Florida.

APPEARANCES

For Petitioner: Susan R. Brown, Esquire

Office of the State Attorney 1490 Northwest 27th Avenue Miami, Florida 33125

For Respondent: Bernard Gross, pro se

16701 Northeast 13th Avenue, #211 North Miami Beach, Florida 33162

INTRODUCTION

This matter began on November 26, 1985, when petitioner, Department of Heath and Rehabilitative Services (HRS), issued a letter advising respondent, Bernard Gross, that it intended to intercept his federal income tax refund, if any, pursuant to the federal tax refund offset program to satisfy "past-due child and/or spousal support." According to the letter respondent owed $4,425 in past-due support. Thereafter, on March 3, 1986, HRS issued a second notice entitled "notice of right to hearing in non-AFDC cases" again giving respondent an opportunity to contest HRS' intention to intercept his federal income tax refund to satisfy an alleged arrearage in support payments.

Respondent timely requested a formal hearing, and the matter was forwarded by HRS to the Division of Administrative Hearings on July 1, 1986, with request that a Hearing Officer be assigned to conduct a formal hearing. In his request for hearing, Gross generally alleged that the agency had failed to adhere to federal rule and statutory requirements when it initiated this matter, and that the agency's claim on his income tax refund was accordingly tainted. By notice of hearing dated August 4, 1986, a final hearing was scheduled for September 4, 1986, in Coral Gables, Florida. The matter was subsequently rescheduled to October 3, 1986, at the same location.

At final hearing petitioner presented the testimony of Mina C. Gross (respondent's former wife) and offered petitioner's exhibits 1 and 2. Both were received into evidence. Respondent testified on his own behalf and offered respondent's composite exhibit 1 which was received into evidence.

There is no transcript of hearing. Neither party filed proposed findings of fact and conclusions of law. 1/

The issue is whether respondent's federal income tax refund, if any, should be subject to interception by petitioner to satisfy past due child or spousal support.

Based upon all of the evidence, the following findings of fact are determined:

FINDINGS OF FACT

1. On September 13, 1985, respondent, Bernard Gross, was found in contempt of the Circuit Court in and for Dade County, Florida, for failing to comply with previous orders of the court to provide child support. According to the order rendered by the court, Gross was in arrears in the amount of $4,650 as of September 4, 1985. A copy of the order has been received into evidence as petitioner's exhibit 2.

   
   

2. By letter dated October 24, 1985 petitioner, Department of Health and Rehabilitative Services (HRS), through its contractor, the Office of the State Attorney, advised Gross that it intended to intercept his federal income tax refund, if any, to satisfy the past-due child support. According to the letter, the past due amount was then $4,425. Gross was further advised he could request an administrative hearing to contest this action no later than November 25, 1985. However, the agency's letter was not postmarked until November 26, 1985, or after the point of entry had expired, and was not received by Gross until December 6, 1985. The letter further erroneously identified the amount due as an "AFDC" claim, which meant the person due the support payments was receiving assistance under the federal Aid to Families with Dependent Children program. This was incorrect.

   
   

3. Gross was given an informal meeting with HRS personnel on January 29, 1986, for an undisclosed purpose. However, later HRS correspondence implies it was for the purpose of allowing Gross to attempt to get HRS to reconsider its earlier decision to intercept his income tax refund. When this effort was apparently unsuccessful, HRS, through its contractor, issued a Notice of Right to Hearing in Non-AFDC Cases on March 3, 1986, offering Gross an opportunity for a formal hearing. The notice made reference to the earlier court order dated September 13, 1985, and stated the arrearage due was greater than $500, the support was owed to or on behalf of a minor child, and it was more than three months past due. Gross thereafter timely requested a formal hearing.

   
   

4. The clerk of the Circuit Court in and for Dade County maintains a central depository which has an account history for each person paying child and spousal support. According to the computer printout on Gross' account, Gross owed $4,650 as of September 4, 1985, but it decreased to $4,255 as of December 25, 1985. The amount is subject to change each week since the printout indicates Gross must pay $85 per week in child support. The printout has been received into evidence as petitioner's exhibit 1. Gross did not challenge or contest the accuracy of the numbers contained in the document.

5. At final hearing petitioner ore tenus amended its request to claim only

   $4,255. That amount is the last amount shown on Gross' payment record, and is the balance due as of December 25, 1985. This date was selected by petitioner's counsel since it represents the most current data on respondent's account.

   Gross' former wife confirmed that Gross owed her more than $4,000 as of the end of 1985, but could not state the precise amount owed.

   
   

6. Federal regulations (45 CFR 303.72) govern the conditions under which a federal income tax refund may be intercepted in a non-AFDC case to offset past- due support owed by the taxpayer. As is pertinent here, they require that the taxpayer owe support to or on behalf of a minor child and that it be not less than $500. Regulations also require that the agency substantiate the delinquent amount with a copy of the "court order, or an order of an administrative process established under State law, for support and maintenance of a child, or of a child and the parent with whom the child is living," "a copy of the payment record," or if no payment record exists, "an affidavit signed by the custodial parent attesting to the amount of support owed." In this regard, petitioner tendered into evidence a copy of the September 13, 1985 court order, a certified copy of the clerk of the circuit court's payment record, and offered the testimony of Gross' former wife, the latter in an effort to establish the amount owed her as of the end of 1985.

   
   

7. Through his own testimony, and the submission of respondent's composite exhibit 1, Gross contended that various errors occurred in the administrative process that culminated in the final hearing. First, he cited the agency's failure to send its October 24, 1985 letter until November 26, or after the original point of entry had expired. He also pointed out that this notice was dated only fifty days after the court order, and that a minimum of ninety days is required by law. He further contended he had no opportunity prior to hearing to question the amount of past-due support allegedly owed. Finally, he pointed out that the court order of September 13 refers to an arrearage of $4,650, the proposed agency action on March 3 relies upon an arrearage of $4,450, and at hearing petitioner claimed the past due amount was $4,255. He did not deny that he owed the above amounts, but contended the agency was bound to seek only the amount shown in the court order, and by later changing the amount allegedly due, HRS has invalidated its claim.

   
   

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction of the subject matter and the parties thereto pursuant to Subsection 120.57(1), Florida Statutes (1985).

   
   

9. Pursuant to the federal Social Security Act, the State of Florida, through HRS, has filed with the federal Office of Child Support Enforcement a state plan describing the nature and scope of its participation in the Child Support Enforcement program. The plan having been approved, the State is authorized to certify to the Secretary of the Treasury that a taxpayer owes past-due support. After certain criteria are satisfied, the Secretary may then "intercept" the taxpayer's federal income tax refund, and withhold from said refund an amount equal to such past-due support. Although a veritable maze of federal regulations and statutory provisions apply to this procedure, portions of 42 USC s. 664 and 45 CFR s. 303.72 are most relevant to this proceeding. Paragraph (a)(3)(A) of Section 664 provides in relevant part that:

   
   

   Prior to notifying the Secretary of the Treasury under paragraph (1) or (2) that an

   individual owes past-due support, the State shall send notice to such individual that a withholding will be made from any refund otherwise payable to such individual. The notice shall also (i) instruct the individual owing the past-due support of the steps which may be taken to contest the State's determination that past-due support is owed or the amount of the past-due support, . . .

   
   

   In addition, paragraph (b)(2) provides in part that "the withholding shall apply only in the case where the state determines that the amount of past-due support which will be owed at the time the withholding is to be made . . . is equal to or greater than $500." Finally, paragraphs (c)(1) and (2) define "past-due support" to mean:

   
   

   1. . . . the amount of a delinquency, deter- mined under a court order, or an order of an administrative process established under state law, for support and maintenance of a child, or of a child and the parent with whom the child is living.

   2. . . . the term "past due support" means only past-due support owed to or on behalf of a minor child.

      
      

      Paragraph (a)(2) of Title 45 CFR 303.72 provides in part as follows:

      
      

      1. Past due support qualifying for offset. Past due support as defined in s. 301.1 of this chapter 2/ qualifies for offset if:

         * * *

   3. For support owed in cases where an application for IV-D services is filed with the IV-D agency 3/ pursuant to s. 303.33 of this chapter:

      (i) The support is owed to or on behalf of a minor child;

      (i)i The amount of support is not less than $500;

      1. At state option, the amount has accrued since the State IV-D agency began to enforce the support order; and

      2. The State has checked its records to determine if an AFDC or foster care maintenance assigned arrearage exists with respect to the non-AFDC individual or family.

   4. The IV-D agency has in its records:

      1. A copy of the order and any modification upon which the amount referred is based which specify the date of issuance and amount of support;

      2. A copy of the payment record, or, if there is no payment record, an affidavit signed by the custodial parent attesting to

         the amount of support owed; and

      3. In non-AFDC cases, the custodial parent's current address.

      
      

      Finally, paragraph (f) of Section 303.72 describes as follows the procedure for contesting an intrastate case:

      
      

      (1) Upon receipt of a complaint from an absent parent in response to the advance notice required in paragraph (e)(1) of this section or concerning a tax refund which has already been offset, the IV-D agency must send a notice to the absent parent and, in non-AFDC cases the non-custodial parent, of the time and place of the administrative review of the complaint and conduct the review to determine the validity of the complaint.

      
      

10. A capsulization of the above statutes and regulations reveals that in order to perfect a claim in a non-AFDC case such as this, HRS (or its contractor) must demonstrate that past-due support to a minor child in the amount of not less than $500 is owed by a taxpayer. It must also submit "a copy of the order . . . upon which the amount referred is based which specify the date of issuance and amount of support" and "a copy of the payment record, or .

    . . an affidavit signed by the custodial parent attesting to the amount of support owed." Contrary to both parties' assertions, there is no requirement that the support must be delinquent for three months or longer. Indeed, the latter requirement is embodied in paragraph (a)(2)(ii) of Section 303.72 and pertains only to AFDC cases.

    
    

11. In the case at bar petitioner has submitted a court order reflecting that Gross owed $4650 in past-due support to his minor child as of September 4, 1985. This is corroborated by the payment record received in evidence as petitioner's exhibit 1. Since the federal statute and pertinent regulations are quite specific in requiring that the amount claimed in past-due support be based upon a court order and payment record, the agency's initial demand upon Gross should have been, as it was, $4,650. The procedure then contemplates that at hearing the taxpayer may present evidence that the amount has changed through subsequent payments. Even though the agency later used amounts which differed from the court order, they conformed with respondent's payment history. Therefore, these changes were harmless error at most and did not deprive respondent of due process or otherwise impair the fairness of the proceeding. Indeed, through uncontroverted evidence, it was conclusively shown that respondent owed $4,255 as of December 25, 1985. Accordingly, it is concluded petitioner may certify that amount to the Secretary of the Treasury under the federal tax refund offset program.

    
    

12. In addition to arguing that the agency's use of three different amounts constituted error, Gross also contended that other errors occurred. He first asserts the agency's initial notice of October 24 was not timely served. While this is true, he received a second point of entry into the administrative process in March 1986 thereby preserving his right to a hearing. Next, Gross asserts he had no opportunity prior to hearing to question the accuracy of the amount allegedly due. But respondent had two such opportunities to do so--once during the judicial proceeding in September 1985, and again during the de novo administrative hearing conducted on October 3, 1986. Finally, Gross contends

the amount past-due must be owed for at least ninety days before a claim may be made, and that here the agency instituted the action less than two months after the court order was entered. This contention is unavailing since the ninety day requirement pertains only to AFDC cases and not to a non-AFDC case such as this. 4/ Even so, Gross' responsibility to pay child support was previously established far before the September 13 hearing. The order of September 13 specifically found him in contempt for being in arrears, and adjudged the amount then owed as being $4,650. This amount was "past due" within the meaning of the rules and statute, and accordingly no error has occurred.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a Final Order be entered certifying a claim to the

Secretary of the Treasury in the amount of $4,255 against respondent's federal income tax refund, if any.

DONE and ORDERED this 23rd day of October 1986 in Tallahassee, Leon County, Florida.

DONALD R. ALEXANDER

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

FILED with the Clerk of the Division of Administrative Hearings this 23rd day of October 1986.

ENDNOTES

1/ Proposed findings of fact and conclusions of law were du no later than October 13, 1986. None were filed.

2/ Past-due support is defined in Sec. 301.1 to mean "the amount of support determined under a court order or an order of an administrative process established under State law for support and maintenance of a child . . . which has not been paid."

3/ A IV-D agency is defined in Sec. 301.1 to be the "organizational unit in the State that has the responsibility for administering or supervising the administration of the State plan under title IV-D of the Act." In this case, HR is the IV-D agency.

4/ Under Gross' theory, once a contempt order is entered, the agency must still wait ninety days before instituting an action. This presumes, of course, that there were no arrearages in the first place which should prompt the court to find the respondent in contempt for failing to comply with previous orders of support--a fallacious assumption.

COPIES FURNISHED:

Susan R. Brown, Esquire Office of the State Attorney 1490 N.W. 27th Avenue

Miami, Florida 33125

Bernard Gross

16701 N.E. 13th Avenue, #211

N. Miami Beach, Florida 33162

William Page, Jr.

Secretary

Department of Health and Rehabilitative Services

1323 Winewood Blvd.

Tallahassee, Florida 32301

Steven W. Huss, Esquire General Counsel Department of Health and Rehabilitative Services 1323 Winewood Blvd.

Tallahassee, Florida 32301

Docket for Case No: 86-002427

Orders for Case No: 86-002427