tion to such other safeguards as the Secretary may specify in regulations):

(1) POLICIES RESTRICTING ACCESS.-Written policies concerning access to data by State agency personnel, and sharing of data with other persons, which

(A) permit access to and use of data only to the extent necessary to carry out the State program under this part; and

(B) specify the data which may be used for particular program purposes, and the personnel permitted access to such data.

(2) SYSTEMS CONTROLS.-Systems controls (such as passwords or blocking of fields) to ensure strict adherence to the policies described in paragraph (1).

(3) MONITORING OF ACCESS.-Routine monitoring of access to and use of the automated system, through methods such as audit trails and feedback mechanisms, to guard against and promptly identify unauthorized access or use.

(4) TRAINING AND INFORMATION.-Procedures to ensure that all personnel (including State and local agency staff and contractors) who may have access to or be required to use confidential program data are informed of applicable requirements and penalties (including those in section 6103 of the Internal Revenue Code of 1986 445), and are adequately trained in security procedures.

(5) PENALTIES.-Administrative penalties (up to and including dismissal from employment) for unauthorized access to, or disclosure or use of, confidential data.

(e) STATE CASE REGISTRY.—

(1) CONTENTS.-The automated system required by this section shall include a registry (which shall be known as the "State case registry") that contains records with respect to

(A) each case in which services are being provided by the State agency under the State plan approved under this part; and

(B) each support order established or modified in the State on or after October 1, 1998.

(2) LINKING OF LOCAL REGISTRIES.-The State case registry may be established by linking local case registries of support orders through an automated information network, subject to this section.

(3) USE OF STANDARDIZED DATA ELEMENTS.-Such records shall use standardized data elements for both parents (such as names, social security numbers and other uniform identification numbers, dates of birth, and case identification numbers), and contain such other information (such as on case status) as the Secretary may require.

(4) PAYMENT RECORDS.-Each case record in the State case registry with respect to which services are being provided under the State plan approved under this part and with respect to which a support order has been established shall include a record of

(A) the amount of monthly (or other periodic) support owed under the order, and other amounts (including ar

445 See Vol. II, P.L. 83-591, §6103.

rearages, interest or late payment penalties, and fees) due or overdue under the order;

(B) any amount described in subparagraph (A) that has been collected;

(C) the distribution of such collected amounts;

(D) the birth date and, beginning not later than October 1, 1999, the social security number, of any child 446 for whom the order requires the provision of support; and

(E) the amount of any lien imposed with respect to the order pursuant to section 466(a)(4).

(5) UPDATING AND MONITORING.-The State agency operating the automated system required by this section shall promptly establish and update, maintain, and regularly monitor, case records in the State case registry with respect to which services are being provided under the State plan approved under this part, on the basis of

(A) information on administrative actions and administrative and judicial proceedings and orders relating to paternity and support;

(B) information obtained from comparison with Federal, State, or local sources of information;

(C) information on support collections and distributions; and

(D) any other relevant information.

(f) INFORMATION COMPARISONS AND OTHER DISCLOSURES OF INFORMATION.-The State shall use the automated system required by this section to extract information from (at such times, and in such standardized format or formats, as may be required by the Secretary), to share and compare information with, and to receive information from, other data bases and information necessary to enable the State agency (or the Secretary or other State or Federal agencies) to carry out this part, subject to section 6103 of the Internal Revenue Code of 1986. Such information comparison activities shall include the following:

(1) FEDERAL CASE REGISTRY OF CHILD SUPPORT ORDERS.Furnishing to the Federal Case Registry of Child Support Orders established under section 453(h) (and update as necessary, with information including notice of expiration of orders) the minimum amount of information on child support cases recorded in the State case registry that is necessary to operate the registry (as specified by the Secretary in regulations).

(2) FEDERAL PARENT LOCATOR SERVICE.-Exchanging information with the Federal Parent Locator Service for the purposes specified in section 453.

(3) TEMPORARY FAMILY ASSISTANCE AND MEDICAID AGENCIES.-Exchanging information with State agencies (of the State and of other States) administering programs funded under part A, programs operated under a State plan approved under title XIX, and other programs designated by the Sec

446 P.L. 105-34, §1090(a)(1), struck out "the birth date of any child" and substituted "the birth date and, beginning not later than October 1, 1999, the social security number, of any child", effective October 1, 1998.

See Vol. II, P.L. 105-34, §1090(a)(3), with respect to coordination and reports required with regard to implementation issues.

retary, as necessary to perform State agency responsibilities under this part and under such programs.

(4) INTRASTATE AND INTERSTATE INFORMATION COMPARISONS.-Exchanging information with other agencies of the State, agencies of other States, and interstate information networks, as necessary and appropriate to carry out (or assist other States to carry out) the purposes of this part. 447

COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS

SEC. 454B. [42 U.S.C. 654b] (a) STATE DISBURSEMENT UNIT.(1) IN GENERAL.-In order for a State to meet the requirements of this section, the State agency must establish and operate a unit (which shall be known as the "State disbursement unit") for the collection and disbursement of payments under support orders

(A) in all cases being enforced by the State pursuant to section 454(4); and

(B) in all cases not being enforced by the State under this part in which the support order is initially issued in the State on or after January 1, 1994, and in which the income of the noncustodial parent is subject to withholding pursuant to section 466(a)(8)(B).

(2) OPERATION.-The State disbursement unit shall be operated

(A) directly by the State agency (or 2 or more State agencies under a regional cooperative agreement), or (to the extent appropriate) by a contractor responsible directly to the State agency; and

(B) except in cases described in paragraph (1)(B), in coordination with the automated system established by the State pursuant to section 454A.

(3) LINKING OF LOCAL DISBURSEMENT UNITS.-The State disbursement unit may be established by linking local disbursement units through an automated information network, subject to this section, if the Secretary agrees that the system will not costs more nor take more time to establish or operate than a centralized system. In addition, employers shall be given 1 location to which income withholding is sent.

(b) REQUIRED PROCEDURES.-The State disbursement unit shall use automated procedures, electronic processes, and computer-driven technology to the maximum extent feasible, efficient, and economical, for the collection and disbursement of support payments, including procedures

(1) for receipt of payments from parents, employers, and other States, and for disbursements to custodial parents and other obligees, the State agency, and the agencies of other States;

(2) for accurate identification of payments;

(3) to ensure prompt disbursement of the custodial parent's share of any payment; and

(4) to furnish to any parent, upon request, timely information on the current status of support payments under an order requiring payments to be made by or to the parent, except that

447 P.L. 104-193, §311, added subsections (e) and (f). For the effective date, see Vol. II, P.L. 104-193, §395.

in cases described in subsection (a)(1)(B), the State disbursement unit shall not be required to convert and maintain in automated form records of payments kept pursuant to section 466(a)(8)(B)(iii) before the effective date of this section. (c) TIMING OF DISBURSEMENTS.—

(1) IN GENERAL.-Except as provided in paragraph (2), the State disbursement unit shall distribute all amounts payable under section 457(a) within 2 business days after receipt from the employer or other source of periodic income, if sufficient information identifying the payee is provided. The date of collection for amounts collected and distributed under this part is the date of receipt by the State disbursement unit, except that if current support is withheld by an employer in the month when due and is received by the State disbursement unit in a month other than the month when due, the date of withholding may be deemed to be the date of collection. 448

(2) PERMISSIVE RETENTION OF ARREARAGES.-The State disbursement unit may delay the distribution of collections toward arrearages until the resolution of any timely appeal with respect to such arrearages.

(d) BUSINESS DAY DEFINED.-As used in this section, the term "business day" means a day on which State offices are open for regular business. 449

(g) COLLECTION AND DISTRIBUTION OF SUPPORT PAYMENTS.—

(1) IN GENERAL.-The State shall use the automated system required by this section, to the maximum extent feasible, to assist and facilitate the collection and disbursement of support payments through the State disbursement unit operated under section 454B, through the performance of functions, including, at a minimum

(A) transmission of orders and notices to employers (and other debtors) for the withholding of income

(i) within 2 business days after receipt of notice of, and the income source subject to, such withholding from a court, another State, an employer, the Federal Parent Locator Service, or another source recognized by the State; and

(ii) using uniform formats prescribed by the Secretary;

(B) ongoing monitoring to promptly identify failures to make timely payment of support; and

(C) automatic use of enforcement procedures (including procedures authorized pursuant to section 466(c)) if payments are not timely made.

(2) BUSINESS DAY DEFINED.-As used in paragraph (1), the term "business day" means a day on which State offices are open for regular business. 450

(h) EXPEDITED ADMINISTRATIVE PROCEDURES.-The automated system required by this section shall be used, to the maximum ex

448 P.L. 105-33, §5549, added this sentence, effective as if included in the enactment of title III of P.L. 104-193, August 22, 1996.

449 P.L. 104-193, §312(b), added §454B, to become effective October 1, 1998. See also, Vol. II, P.L. 104-193, §312(d).

450 P.L. 104-193, §312(c), added subsection (g), to become effective October 1, 1998. See also, Vol. II, P.L. 104–193, §312(d).

tent feasible, to implement the expedited administrative procedures required by section 466(c). 451

PAYMENTS TO STATES 452

SEC. 455. [42 U.S.C. 655] (a)(1) From the sums appropriated therefor, the Secretary shall pay to each State for each quarter an

amount

(A) equal to the percent specified in paragraph (2) of the total amounts expended by such State during such quarter for the operation of the plan approved under section 454, 453

(B) equal to the percent specified in paragraph (3)454 (rather than the percent specified in subparagraph (A)) of 455 the sums expended during such quarter as are attributable to the planning, design, development, installation or enhancement of an automatic data processing and information retrieval system (including in such sums the full cost of the hardware components of such system), 456

(C) equal to 90 percent (rather than the percentage specified in subparagraph (A)) 457 of so much of the sums expended during such quarter as are attributable to laboratory costs incurred in determining paternity, and 458

(D) equal to 66 percent of the sums expended by the State during the quarter for an alternative statewide system for which a waiver has been granted under section 452(d)(3), but only to the extent that the total of the sums so expended by the State on or after the date of the enactment of this subparagraph does not exceed the least total cost estimate submitted by the State pursuant to section 452(d)(3)(C) in the request for the waiver; 459

except that no amount shall be paid to any State on account of amounts expended to carry out an agreement which it has entered into pursuant to section 463. In determining the total amounts ex

451 P.L. 104-193, §325(b), added subsection (h). For the effective date, see Vol. II, P.L. 104– 193, §395.

452 See Vol. II, P.L. 99-177, Title II, "Balanced Budget and Emergency Deficit Control Act of 1985", §256 (as amended by P.L. 100-119], with respect to treatment of child enforcement program; and $257(11), with respect to references to §401(c)(2) of the "Congressional Budget Act of 1974".

453 P.L. 100-485, §123(c)(1), provided that this subparagraph (A) shall be stricken; §123(c)(2), provided that subparagraph (C) be redesignated as subparagraph (A), and §123(c)(3)(B) provided that "and" be inserted at the end of the new subparagraph (A), effective September 30, 1995. P.L. 104-193, §344(c) repealed §123(c) of P.L. 100-485. For the effective date, see Vol. II, P.L. 104-193, §395.

454 P.L. 104-193, §344(b)(1)(A)(i), struck out "90 percent" and substituted "the percent specified in paragraph (3)". For the effective date, see Vol. II, P.L. 104-193, §395.

455 P.L. 104-193, §344(b)(1)(A)(ii), struck out "so much of". For the effective date, see Vol. II, P.L. 104-193, §395.

456 P.L. 104-193, §344(b)(1)(A)(iii), struck out "which the Secretary finds meets the requirements specified in section 454(16), or meets such requirements without regard to clause (D) thereof, and" and substituted ", and". For the effective date, see Vol. II, P.L. 104–193, §395.

P.L. 105-200, §102(b)(1), struck out “and”.

P.L. 100-485, §123(c)(1), provided that this subparagraph (B) shall be stricken; §123(c)(4), provided that the following subparagraph (B) shall be inserted:

"(B) equal to the percent specified in paragraph (2) of the total amounts expended by such State during such quarter for the operation of the plan approved under section 454;”, effective September 30, 1995.

P.L. 104-193, §344(c), repealed §123(c) of P.L. 100-485. For effective date, see Vol. II, P.L. 104-193, §395.

457 P.L. 100-485, §123(c)(3)A), provided that "(rather than the percentage specified in subparagraph (A))" be stricken, effective September 30, 1995.

P.L. 104-193, §344(c) repealed §123(c) of P.L. 100-485. For the effective date, see Vol. II, P.L. 104-193, §395.

458 P.L. 105-200, §102(b)(2), struck out the semicolon and substituted ", and". 459 P.L. 105-200, §102(b)(3), added subparagraph (D), effective July 16, 1998.