2010 WICSEC Annual Training Conference Materials/2010 Santa... · 2010 WICSEC Annual Training Conference ... Service - Innovation 22 Servicemembers’ Civil Relief Act (SCRA) 11/2/2010

Integrity - Service - Innovation

2010 WICSEC Annual Training Conference

Neal W. NelsonAssistant General Counsel

Director, Garnishment OperationsDefense Finance and Accounting Service

November 8, 2010

11/2/2010 Integrity - Service - Innovation 2

DFAS – Garnishment Operations

ResponsibilitiesWorkloadSystemsNew InitiativesChild Support Locate and Enforcement IssuesServicemembers’ Civil Relief Act Various Garnishment Issues


Responsibilities

All Child Support/Alimony Garnishments for All Civilian Employees and Military members Paid by DFAS – DoD, DOE, DHHS, DVA, EPA, BBG

USFSPA Applications for Court-Ordered Divisions of Military Retired Pay

Commercial Garnishments – Civilian Employees

Military Commercial Debt Involuntary Allotments

Chapter 13 and Chapter 7 Personal Bankruptcies


Staff CompositionAssistant General Counsel, Director– Neal W. Nelson

Deputy Assistant General Counsel, Deputy Director– Scott Lafferty

Four Team Attorneys

Four Multi-disciplined Teams – 50 EmployeesFour Supervisory ParalegalsEleven/Twelve Paralegals Per Team

Five Support Staff: Executive Assistant Systems Analyst (IGS), State Child Support Liaison Systems Analyst (IGARN), Telework CoordinatorLegal Assistant Secretary

Document Control Center – 10 EmployeesSupervisory Mail Equipment OperatorNine Mail Equipment Operators


Workload

Court Ordered Actions Processed:

FY 2005: 341,281FY 2006: 324,281FY 2007: 342,734FY 2008: 353,807FY 2009: 409,133 15.6% IncreaseFY 2010: 410,940

Average Monthly Pay Out: $130 -140 Million


Workload by Case Type

Alimony/Child Support: 71.9%

USFSPA: 11.9%

Commercial Debt: 13.17%Military: 2.6%Civilian: 10.57%

Bankruptcy: 2.9%


Systems

• Payroll Locator File System (PLFS)

PLFS contains DoD Civilians, Military Active Duty, Reserves and Retirees – Also contains information for employees of other agencies that DFAS pays: Currently DOE, DHHS, EPA, BBG and DVA EmployeesDramatic Reduction in Search Time

• Electronic Document Management System (IGARN)

Workflow Management & Imaging SystemAll Documents Received by Mail are ImagedInterfaces with PLFS & IGSFax Gateway – Electronically routes Documents to IGARN


Systems (continued)

• Integrated Garnishment System (IGS)

IGS assists paralegals with the validation of legal documents through legal review functionalityThe single interface between imaging, PLFS and Payroll SystemsIGS utilizes Smart Docs to send electronic notification of garnishments

Decreases receipt timeReduces costs: postage, paper, man hours

Implementation Status of Various Pay Systems

Civilian Pay System (DCPS, NAFCPS)Retired Military Pay System Active Duty Military Pay SystemsReserve Pay – In Development


EC/EDI Initiatives – Kids 1st

DFAS Kids 1st ProgramChild Support Enforcement Agencies Send Orders Directly to DFAS over secure network - First of its kind in the country!Kids 1st file layout served as the model for the electronic Income Withholding Order (eIWO) program – Developed in coordination with DFAS, Federal Office of Child Support Enforcement (OCSE) and the states

We currently have 28 states using EC to send child support orders to DFAS

FY 09 - eIWO Production up 40% over FY 08FY 10 Production – Over 100,000 electronic orders received


EC/EDI Initiatives – Kids 1st / eIWO

Five states use the Web Based process;Georgia - Hawaii – New Mexico – Utah - Wisconsin

Two states use the Batch Process;South Dakota – Iowa

Twenty-one states in Production with eIWO;Arizona - California – Colorado – Idaho - Illinois - Indiana –Massachusetts – Nebraska – New Jersey - New York -North Carolina – North Dakota – Ohio - Oklahoma – Oregon –Pennsylvania – Texas – Virginia – Washington – Washington D.C. - West Virginia

Three states In Development/Testing – Projected Implementation – FY ‘11

Michigan – Mississippi - Missouri


Electronic Bankruptcy Court Interface (eBCI)

eBCI Implemented February 2010

We are now receiving bankruptcy documents electronically by batch fileSeptember Production – 250 documents receivedBenefits –

Decreases time to receive bankruptcy documentsEliminates need to process hard copy documents received by mailEliminates manual workload to look up missing SSN’sDecreases the probability of violation of the automatic stay by giving us the opportunity to stop garnishments & debt collectionsAutomates the re-routing process of “no-match SSN” documents to Debt and Claims Management


DoD Policy

ParentsAre To Be

Fiscally Responsible For Their Children


Service Regulations

Army - AR 608-99

Air Force - AFI 36-2906

Navy - SECNAVINST 7431.1

Marine Corps - Marine Corps Order P5800.16 (LEGADMIN) Chapter 15

Coast Guard - PERSMAN Chapter 8M


Service of Process

Jurisdictional Issue

Personal Service

Service Overseashttp://www.travel.state.gov/law/info/judicial/judicial_680.html


Resources

• ‘A Caseworker’s Guide to Support Enforcement and Military Personnel’

http://www.acf.hhs.gov/programs/cse/fct/militaryguide2000.htm• (Click on virtual library of training materials)

• ‘Working with the Military on Child Support Matters: Trainer Guide’

http://www.acf.hhs.gov/programs/cse/pubs/training/working_with_military


Locate Issues and VOE’S

• The information is contained in the Quarterly Wage & New Hire Reports ─ these include all pays the member received for the quarter.

• Ask State Child Support Office for DoD External Locate Requests ─ sent from the state to DMDC

Active duty/unit duty addressReserves-unit/duty addressRetired-home addressContact your state technical support liaison listed on ACF website

under new hire contacts

• Use of subpoena is cumbersome for states & puts heavy burden on DFAS.


Military Locator

• Army:Military Locator is permanentlydisabledRequests may by sent by Fax to(703) 325-3008

• Marine Corps:HQMC – MMSB -172008 Elliot Road, Room 203Quantico, VA 22134-5030(703) 784-3941www.mmsb.usmc.mil

• Navy:Navy Personnel Command(PERS 312)5720 Integrity DriveMillington, TN 38055-3120(901) 874-3388fax (901) 874-2000

• Air Force:HQ/AFPCDPDXIDL550 C. St. West, Suite 50Randolph AFB, TX 78150-4752(210) 565-2660(210) 565-1675


Military Locator (cont’d)

• Coast Guard:US Coast GuardPersonnel Command2100 2nd St. SWWashington, DC 20593(202) 493-1200fax (202) 267-4985


Facilitating Service of Process

Army:Office of the Judge Advocate GeneralAttn: DAJA-LA2200 Army PentagonWashington, D.C. 20310(703) 588-6708

Navy:Office of the Judge Advocate General (Code 16)1322 Patterson Avenue, SESuite 3000Washington Navy Yard, D.C. 20374-5066(202) 685-4637

Air Force:

AFLSA/JACA1420 Air Force PentagonWashington, D.C. 20330-1420(703) 697-0413


Facilitating Service of Process

Marine Corps:Paralegal SpecialistHeadquarters, US Marine Corps (JAR)2 Navy AnnexQuantico, VA 22134(703) 614-3880

Coast Guard:United States Coast GuardG-PC (USCG)Room 4100E, CGHQDepartment of TransportationWashington, D.C. 20590(202) 267-2799


Voluntary Acknowledgement of Paternity

Previous DoD policy - Out of wedlock children were dependents for health care benefits

Judicial determination of paternityDependent upon member for more than 50 percent of his or her support

January 28, 2008 - New policy expands and creates a third category: a voluntary acknowledgement of paternity

Policy is to facilitate entitlements to military benefits provided to children of Uniformed Service Members


Servicemembers’ Civil Relief Act (SCRA)


Time for a Change

“Congress has long recognized that the men and women of our military services should have civil legal protections so they can "devote their entire energy to the defense needs of the Nation." With hundreds of thousands of servicemembers fighting in the war on terrorism and the war in Iraq, many of them mobilized from the reserve components, the Committee believes the Soldiers' and Sailors' Civil Relief Act (SSCRA) should be restated and strengthened to ensure that its protections meet their needs in the 21st century.”

House Committee on Veterans Affairs Report 108 H. Rpt. 81


Servicemembers’ Civil Relief Act (SCRA)

Purposes of the SCRA:

(1) to provide for, strengthen, and expedite the national defense through protection extended by this Act to service members of the United States to enable such persons to devote their entire energy to the defense needs of the Nation; and

(2) to provide for the temporary suspension of judicial and administrative proceedings and transactions that may adversely affect the civil rights of service members during their military service.


ORGANIZATION

Found at 50 USC App. §§ 501-596 (cites herein are to 50 U.S.C. App. § ___) Title I - General ProvisionsTitle II - General Relief

Default judgments and stays --§§ 521, 522, 524, 525Fines & Penalties in contracts - § 523Statutes of Limitation --§ 526Maximum rate of interest - § 527

Title III (§§ 531-538)Major substantive protections against evictions, termination of installment contracts, foreclosure on mortgages, and terminationof leases by lessees, protection to dependents


ORGANIZATION (cont.)

Title IV - Life Insurance (§§ 541-549)

Title V - Taxes and Public Lands§ 571 - Residence for tax purposes

Title VI - Administrative Remedies

Title VII - Further Relief


New Improved SCRA

On 19 December 2003, President Bush signed the SCRA, a complete revision of the SSCRA.

The SCRA was written to: Clarify the language of the SSCRAIncorporate and codify many years of judicial interpretation of the SSCRAUpdate the SSCRA to reflect developments in American life since 1940


Recent Amendments to SCRA

2004:Amended 50 USC App §511— “judgment” to includes any judgment, decree, order or ruling—final or temporary.Waivers of SCRA rights must be in separate documents with 12 point type.Made the stay provisions available to plaintiffs as well as defendants.Lease termination protections of 50 USC App §535 apply to spouses

2006:Amended 50 USC App §594 to insulate Service members from health insurance premium increases other than those of general applicability.


Recent SCRA Amendments (continued)

2008:Default judgment protections clarified: “applies to any civil proceeding, including child custody proceeding” (§ 521)

Stay procedures clarified: “applies to any civil proceeding, including child custody proceeding” (§ 522)

Interest rate cap for mortgage type obligations extended one year beyond end of active duty (§ 527)

Violations of interest rate caps made punitive (§ 527)

Protections for pre-service mortgage obligations extended to 9 months after active duty (stays/ foreclosures) (§ 533)

Authority to terminate some cell phone contracts (§ 535A)


Scope of the SCRA

Who is Covered:Active Military

Army, Navy, Air Force, Marine Corps, Coast GuardReservists called to active dutyNational Guard in Title 10 status or Title 32 status if called to active duty for more than 30 days for purposes of responding to a national emergency declared by the President and supported by federal funds

Not applicable to:RetireesCivilian EmployeesDoD ContractorsDependents*

*Certain protections may apply to contractual obligations of dependents (e.g., leases terminations)


Proceedings/Orders Covered by SCRA

Judicial Proceedings

Administrative proceedings (as of Dec. 2003)

Entry of interim orders (as of Dec. 2004)

Entry of final orders

The SCRA has very limited effect on the enforcement of withholding orders (garnishments)


Automatic Stays

As a general rule, the court must grant an initial stay of proceeding for no less than 90 days if properly requested by the Service member (plaintiff ordefendant).

Rationale:

With delayed mail delivery and diminished opportunities to consult with legal counsel so common to military service, a period of time is needed to allow an adequate opportunity for servicemembers to consult with military or civilian counsel, and to respond to the courts.


Member Requests for Stay of Proceedings

Two-fold request:Communication from the service member:

Setting forth facts in which current military duty requirements materially affect his/her ability to appear Stating a date when the Service member will be available to appear

Letter from the Service member’s commanding officer affirming the following:

Service member's military duty prevents an appearanceMilitary leave is not authorized for the Service member at the time of the letter

If this letter contains the Service member’s available court dates, the court may deem the letter sufficient to pass the two-fold test.


Effect of Request for Stay on Member’s Rights

Application for a stay under §522 does not constitute an appearance for jurisdictional purposes and does not constitute a waiver of any substantive or procedural defense (including a defense relating to lack of personal jurisdiction).


DOD Instruction 1327.6 - Leave & Liberty

Mandates that service member’s commander grant leave for paternity and support hearings.

Exceptions:Service member is deployed in a war Exigencies of military service require denial of such a request


Subsequent Requests for Stay

Court has the discretion to grant or deny the stay

If the court denies the stay, it must appoint an attorney to represent the service member


SCRA and Default Judgments

When a defendant does not appear in court or respond to court summons, the SCRA requires a sworn affidavit by the plaintiff stating either:

Whether or not the defendant is in military service and showing necessary facts to support the affidavitThe plaintiff is unable to determine whether or not the defendant is in military service.

Consequences of failing to file an affidavitA non-service member defendant has no remedy.If the defendant is a service member, then the order can be voided and is subject to attack upon a showing that the service member:

is materially affected by reason of military service in making adefense to the actionhas a meritorious or legal defense to all or part of the action.



If defendant is not in the military, the plaintiff may proceed to final judgment.

If defendant is in the military, the court is required to appoint an attorney for the defendant.


Appointed Counsel

When defendant is a service member, the court must appoint an attorney prior to granting a default judgment

Duties of appointed attorneyprotects Service member’s rightsdetermines status and seeks stay

Can’t waive rights or bind service member



SCRA default guidance applies to all of the following:Final JudgmentsInterim Orders (New)Court OrdersAdministrative Support Orders but… not to administrative enforcement remedies, such as liens, wage withholdings, etc.


Certificate of Military Status

Defense Manpower Data Center (DMDC)Provide Certificate as to military service on the Internet – acceptable documentation to show whether he/she is in the military

https://www.dmdc.osd.mil/scra/owa/scra.home


DMDC Certificate of Military Status

If the Service member is on active duty, this is what you’ll see:


DMDC Certificate of Non-Military Status

If the Service member is NOT on active duty, this is what you’ll see:


Reopening a Default Judgment

Service member can request court to re-open judgment any time during Service member’s period of military service

Service member or their attorney can also file an application to re-open within 90 days of the end of military service


6% Rate Cap

SCRA rule on interest:New law clarifies that interest above 6% must be forgiven (some creditors were deferring interest)Applies to child/spousal support arrearagesApplies to only those arrearages incurred prior to induction to active dutyMaterial affect analysis appliesUnder SCRA, Service member must request the cap and produce orders


FEIN for Military & Civilian Employees

Army (Active Duty) 359990000Army (Reserve Duty) 351819323Air Force (Active Duty) 849990000Air Force (Reserve Duty) 849980000Navy (Active Duty) 349990000Navy (Reserve Duty) 349980000Marine Corp (Active & Reserve) 539990000Retired Pay 340727612DoD Civilian Employees 311575142DoE Civilian Employees 530197006HHS Civilian Employees 530196960EPA Civilian Employees 520852695BBG Civilian Employees 522260085Department of Veterans Affairs 123456789


Figuring Support Obligations

• States will establish support amount in accordance with their State’s guidelines:

Most States use “all income” to compute the amountIncludes both taxable and non-taxable incomeIncludes pay and allowances

• Military Base Pay by Rank and Time in Service

• Special Pays

• Allowances:BAH (Basic Allowance for Housing) - Amount increases with RankBAS (Basic Allowance for Subsistence)


What is Disposable Pay?

IT DEPENDS!• The type of garnishment action determines how Disposable Pay is calculated – Generally:

Gross Pay Minus Authorized Deductions

• For Child Support Cases:

Includes All “Pay Items” – Base Pay and Special PaysBonuses Included – However…

Excludes – Allowances like BAH, BAS, Taxes – But…“Normal” retirement deductions – TSP

• See 5 C.F.R. §581


Military Pay

• The quarterly wage report provided to NDNH includes all income received by a military person.

• Special Skills PaysFlight payHazardous duty payCareer Sea paySubmarine duty payJump payMany others

• BonusesLump-sum (usually for Re-enlisting)

• A detailed list of those pays can be found in the DFAS Quick Guide. (See DFAS web site under child support agencies’ information).


Pay Office Addresses

• Obtain Service Members’ Payroll Information from the Appropriate Military Finance Center

Air Force Active Duty, Air Force Reserves & National Guard

DFAS IndianapolisAttn: DFAS IN-GA8899 East 56th StreetIndianapolis, IN 46249

Army Active Duty, Army Reserves & Army National Guard

DFAS IndianapolisAttn: DFAS IN-FJEF8899 East 56th StreetIndianapolis, IN 46249-0865

Navy Active Duty, Navy ReservesDFAS Cleveland

Attn: DFAS CL-GAF1240 E. 9th StreetCleveland, OH 44199

Marine Corps Active DutyDFAS ClevelandAttn: DFAS-CL -FCRAF1240 E. 9th StreetCleveland, OH 44199

Marine Corps Reserve DutyDFAS ClevelandAttn: DFAS-CL-FPPR1240 East 9th StreetCleveland, OH 44199


Legal Authority

The laws and regulations we use:

Child Support/AlimonyStatutory Involuntary Allotments - 42 USC 665, 32 CFR 54Garnishments - 42 USC 659, 5 CFR 581

Commercial Debt - Civilian/MilitaryCivilian - 5 USC 5520a, 5 CFR 582Military - 5 USC 5520a, 32 CFR 112, 113

Uniformed Services Former Spouses’ Protection Act10 USC 1408, DoDFMR Vol 7B, Chap 29

Consumer Credit Protection Act - 15 USC 1673Servicemembers’ Civil Relief Act - 50 USC App. 501 Et seq.


Child Support

Use Income Withholding Orders (IWO) under 42 U.S.C. §659 or statutory allotment under 42 U.S.C. §665

IWO quicker to Implement

IWO can also be sent electronically through Kids 1st –eIWO

Allocation - When we receive a second or subsequent order and the member’s disposable pay is insufficient to pay all ordered amounts, we must allocate payments between the orders.


Contact Information

Send garnishment orders to:DFAS-HGA-CL

P O Box 998002Cleveland, OH 44199-8002

Customer Service: 1-888-332-7411Fax Gateway: 1-877-622-5930Website: http://www.dfas.mil/

(click on the Garnishment link under the Quick Links Section)

http://www.dfas.mil/

http://www.google.com/imgres?imgurl=http://www.ipofficestore.com/images/ip_office_phone.jpg&imgrefurl=http://www.belligerati.net/archives/2005/05/&h=233&w=250&sz=13&tbnid=di-Di9YrpDUJ::&tbnh=103&tbnw=111&prev=/images%3Fq%3Dwork%2Bphone%2Bimage&hl=en&sa=X&oi=image_result&resnum=2&ct=image&cd=1


Questions?