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ARIZONA STATE SENATE
Fifty-Fourth Legislature, Second Regular Session
support order; dishonored payment; lien
Purpose
Modifies the administrative lien process for child support arrears and allows the Department of Economic Security (DES) to accept alternative forms of payment for child support payments.
Background
A title IV-D case refers to child support orders enforced by a child support enforcement agency (42 U.S.C. 651). Arizona statute states that every person has the duty to provide all reasonable support for their natural and adopted minor, unemancipated children regardless of the presence or residence of the child (A.R.S. § 25-501). The court may order either or both parents to pay any necessary amount of child support and specifies payment for support to be completed by a personal check. If a personal check is dishonored by the payor bank or drawee, any subsequent support payments and handling fees must be paid only by specified forms of payment. Additionally, if a party demonstrates full and timely payment for 24 consecutive months, that party may return to paying support by personal check. (A.R.S. § 25-503).
In a title IV-D case, Arizona statute states that if a person obligated to pay child support is in arrears for an amount equal to at least two months' child support, the unpaid amounts constitute a lien by operation of law on all property owned and later acquired by the obligor. DES must notify the obligor that a notice of lien may be filed against them prior to perfecting the lien through filing a notice of lien with the county recorder. This notice specifies the obligor arrearage in child support pay, their ability to request an administrative review, and the consequences if the obligor does not properly respond. If the obligor fails to respond, a secondary notice is mailed and then, the notice of lien is filed after 15 days of the second notice upon further lack of response.
If an administrative review is requested, DES is required to determine whether to proceed with filing a notice of lien based upon the obligor's requirement to pay child support, status of arrearage, and other information relevant to the case. DES may release the property subject to the lien at any time and if any imposed lien from the title IV-D case is satisfied and the notice of lien has been recorded. Arizona must give a lien recorded in another state full faith and credit if the state agency or party seeking to enforce the lien complies with Arizona's notice requirements and all applicable laws (A.R.S. § 25-516).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Allows, when business checks or electronic forms of payment are dishonored, a party to pay child support by regularly accepted forms of payment, rather than by personal check only.
2. Includes a lien created by a child support order as a qualifying basis for the request for an administrative review that must be reviewed and ruled upon within 10 business days.
3. Establishes that in a title IV-D child support case, an order to pay child support, rather than an arrearage equal to at least two months' child support, creates a lien by operation of law.
4. Allows DES to perfect a lien by submitting a copy of the child support order rather than a notice of lien.
5. Specifies that the lien amount includes the amount owed at the time of recording and any amounts subsequently accrued.
6. Requires the recording of the child support order to be accompanied by the judgement creditor's information statement that sets forth the amount of the current support order at the time of recording.
7. Requires a copy of the judgement creditor's information statement and the recorded child support order to be mailed to the obligor at their last known address.
8. Requires DES to provide a payoff amount to the obligor or a party acting with the obligor's consent on request.
9. Allows the obligor to make a written request for administrative review to contest the arrears, upon disagreement with the payoff amount.
10. Requires DES to release any lien when a title IV-D child support case is closed rather than when the lien is satisfied and a notice of lien had been recorded.
11. Specifies that the lien release does not satisfy any amount of unpaid support or release the lien associated with a recorded judgment.
12. Removes the requirement for DES to notify an obligor who is at least two months in arrears in making child support payments.
13. Removes the requirement for Arizona to give full faith and credit to a lien recorded in another state if the state agency, party or entity seeking to enforce the lien complies with the notice requirements and other applicable laws of Arizona.
14. Makes conforming and technical changes.
Prepared by Senate Research
February 11, 2020
JA/SH/gs