A congressional committee voted Wednesday to all but eliminate penalties against states that have not computerized their child support systems, a move that could save Maryland from losing $263 million in federal funds.
Maryland — along with 13 other states, the District of Columbia and the Virgin Islands — failed to meet an Oct. 1 deadline to get its child support enforcement system on-line.
The federal government was slated to withhold all welfare and child support grants from the tardy governments as punishment.
But a measure approved Wednesday by the House Ways and Means Committee would reduce the penalties to a fraction of those amounts.
Under the bill, which goes to the full House next week, Maryland’s eventual loss could be as low as $100,000. Washington, D.C., which stood to lose $109 million, could see its penalty fall to about $75,000.
The bill approved by the committee yesterday would set the fine for states that are out of compliance this year at 4 percent of the money they get to administer child support programs. States that get their computer systems certified in this fiscal year would get a 75 percent rebate on that amount.
Sanctions would climb to 8 percent for states that are still not in compliance next year, 16 percent in the third year and 20 percent in all subsequent years.
But officials in both Maryland and Washington, D.C., said they are ready to put their computer systems on-line next week.
The Maryland Department of Human Resources will have its system up by March 5, barring “an act of God,” said project deputy manager George Sinclair.
That would end a struggle that began in 1988, when the state hired SHL Systemhouse — a Canadian company with offices in Columbia — to install a computerized system by 1992.
In 1994, with the project years behind schedule, a state audit condemned Systemhouse for missing deadlines and it criticized state overseers for failing to adequately supervise the project. Systemhouse was fired, but sued and ended up recouping most of the $35 million its contract called for.
The 1988 federal law originally called for states to have their systems automated by Oct. 1, 1995, that date was extended by two years after only one state made the deadline.
By Oct. 1, 1997, all of Maryland’s 24 jurisdictions except Baltimore had their computer systems ready to participate in the statewide network.
Baltimore accounts for 46 percent of the state’s child support caseload, but state officials said children there received payments in only 16 percent of the court-ordered child support cases in fiscal 1997. About 55 percent of children in the rest of the state received payments.
Michael Kharfen, a spokesman for the Department of Health of Human Services, said the Clinton administration would support “an alternative penalty that would hold states accountable without cutting off all state funds.”
“We are encouraging Congress to act quickly because otherwise we have no choice but to withhold all federal funds,” said Kharfen.