Electronic Income Withholding Order Project
17th National OCSE
Training Conference
September 10th, 2007
BACKGROUND
- Several States and employers had implemented some type/form of electronic income withholding
- "Notice/Order To Withhold Income For Child Support" form modified in 2004 - AT 04-05
- Unique opportunity to develop a standardized electronic format for income withholding
THE BEGINNING
First meeting in Chicago - August 2004
11 employers and 18 States, Tribes, and Territories attended
Formed workgroups that designed and developed:
- flat file layouts and XML schema based on the "Order/Notice" form
- an electronic acknowledgement process from employers to States
- flat file layouts and XML schema based on the acknowledgement process/design
PILOT
- Established a pilot between several States and employers to test the layouts and the process developed by the workgroup
THE PROCESS
- States put IWOs into an electronic file - paper is not sent to the employer
- Electronic file is picked up by the OCSE Network
- OR employer retrieves e-IWOs from a State portal (CO., TX.)
- OCSE Portal will be discussed shortly
- Electronic Acknowledgement advises the State of what happened with each e-IWO record
- Also handles "Terminations" and "Lump Sums"
PREPARING TO IMPLEMENT
- Clean up FEINs and synchronize existing IWOs between your State and the employer
- Make necessary system changes to accept and process e-IWO data files
PILOT IMPLEMENTATIONS
| State/Employer | Format | Methodology |
| Indiana/Meijer | Flat File | Secure File Transfer Protocol (SFTP) |
| Indiana/DFAS | Flat File | OCSE Network |
| Colorado/Labor Ready | XML | State Portal |
| Texas/Labor Ready | XML | State Portal |
| Texas/H.E. Butt Grocery | Flat File | State Portal |
| Oklahoma/DFAS | Flat File | OCSE Network |
| Oregon/DFAS | Flat File | OCSE Network |
| North Carolina/DFAS | Flat File | OCSE Network |
| Virginia/DFAS | Flat File | OCSE Network |
Subsequent Implementations and Workgroup Members
- California with DFAS
- Massachusetts with DFAS
- Nebraska with DFAS
- Washington with DFAS
- North Dakota with DFAS
- New York testing with DFAS end of August 2007
- Some of the large employers/income payers on the workgroup include:
| ADP | Home Depot |
| American Airlines | SSA |
| Ceridian | Verizon |
| Chrysler | Wal-Mart |
| Ford | Waste Management |
| General Motors | |
NOW A PORTAL
- One place for States, Tribes, and Territories to pick up and drop off e-IWO files
- Child support directors reviewed and approved development of a centralized portal
- Workgroup developed requirements/specifications
- Ability to "translate" and forward file formats
- Secure environment
- Indiana and the US Postal Service piloting the OCSE Portal in September 2007
PILOT STATES COSTS AND BENEFITS
| State |
Development Cost
(# Hrs x $75) |
Collection Increase
(# e-IWOs x .5 x $150) |
Administrative Savings
(# e-IWOs x $1) |
Net Increase/ Decrease |
| Colorado |
400 hours
$30,000
|
6,992 e-IWOs
$524,400
|
$6,992 |
$501,392 |
| Indiana* |
850 hours
$63,750
|
2,837 e-IWOs
$212,775
|
$2,837 |
$151,862 |
| North Carolina |
600 hours
$45,000
|
7,775 e-IWOs
$583,125
|
$7,775 |
$545,900 |
| Oregon |
187 hours
$14,025
|
1,512 e-IWOs
$113,400
|
$1,512 |
$100,887 |
| Texas |
160 hours
$12,000
|
7,716 e-IWOs
$578,700
|
$7,716 |
$574,416 |
COST/SAVINGS ASSUMPTIONS
- Development cost: $75 per hour
- Increase in collections
- Collection percentage: 50%
- Average collection: $150 for three weeks that would not have been
received with paper process
- Administrative savings: $1 per document (postage, paper, processing time)
MORE BENEFITS
- Once developed, adding additional employers (for States) or States (for employers) is straightforward
- Increased collections
- Saves time, money, and resources
- Standardized data records ensure uniform withholding data from all States
- Increased accuracy and reliability of data
- Electronic acknowledgements enable a State to know very quickly whether the IWO will be implemented, employee terminated, etc.
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