Rogers v. Bucks County Domestic Relations Section

• Decision Date: 30 March 1992
• Docket Number: No. 91-1670,91-1670
• Parties: -5313, 60 USLW 2631 Patricia A. ROGERS, Gregory M. Rogers, Jr. and Marvin A. Rogers Individually and on behalf of all similarly situated persons, Appellants, v. BUCKS COUNTY DOMESTIC RELATIONS SECTION and Albert J. Fonash, Director of the Bucks County Domestic Relations Section and JoAnne DeFeo, IRS Offset Coordinator and County of Bucks and Andrew Warren, Mark Schweiker and Lucille Trench, Commissioners of the County of Bucks and Continental Bank, All individually and on behalf of all similarly situated persons and entities and Commonwealth of Pennsylvania Department of Public Welfare and John F. White, Jr., Secretary of the Department of Public Welfare Commonwealth of Pennsylvania, Department of Public Welfare, Bureau of Child Support Enforcement and John F. Stuff, Director of the Bureau of Child Support Enforcement.
• Court: U.S. Court of Appeals — Third Circuit

Page 1268

959 F.2d 1268

70 A.F.T.R.2d 92-5313, 60 USLW 2631

Patricia A. ROGERS, Gregory M. Rogers, Jr. and Marvin A.

Rogers Individually and on behalf of all similarly

situated persons, Appellants, v. BUCKS COUNTY DOMESTIC RELATIONS SECTION and Albert J.

Fonash, Director of the Bucks County Domestic Relations

Section and JoAnne DeFeo, IRS Offset Coordinator and County

of Bucks and Andrew Warren, Mark Schweiker and Lucille

Trench, Commissioners of the County of Bucks and Continental

Bank, All individually and on behalf of all similarly

situated persons and entities and Commonwealth of

Pennsylvania Department of Public Welfare and John F. White,

Jr., Secretary of the Department of Public Welfare

Commonwealth of Pennsylvania, Department of Public Welfare,

Bureau of Child Support Enforcement and John F. Stuff,

Director of the Bureau of Child Support Enforcement.

No. 91-1670.

United States Court of Appeals, Third Circuit.

Argued Feb. 13, 1992.

Decided March 30, 1992.

Michael H. Landis (argued), Ronald J. Smolow, Smolow & Landis, Trevose, Pa., for appellants.

A. Taylor Williams (argued), David M. Donaldson, Administrative Office of Pennsylvania Courts, Philadelphia, Pa., for appellees Bucks County Domestic Relations Section, Albert Fonash and JoAnne DeFeo.

Peter A. Glascott, County Sol., Michael A. Klimpl, Asst. County Sol. (argued), Bucks County Solicitor's Office, Doylestown, Pa., for appellees County of Bucks, Andrew L. Warren, Mark Schweiker and Lucille Trench.

Ernest D. Preate, Jr., Atty. Gen., Calvin R. Koons, Sr. Deputy Atty. Gen. (argued), John G. Knorr, III, Chief Deputy Atty. Gen., Com. of Pa., Harrisburg, Pa., for appellees Com. of Pa., Dept. of Public Welfare, John F. White, Jr., and John F. Stuff.

Amy E. Hirsch, Community Legal Services, Inc., Philadelphia, Pa., for amici curiae Philadelphia Citizens in Action, Maternity Care Coalition of Greater Philadelphia, and Philadelphia Unemployment Project.

Linda Wharton, Women's Law Project, Philadelphia, Pa., for amici curiae Women in Transition and Pennsylvania Nat. Organization for Women.

Before: GREENBERG, COWEN, and SEITZ, Circuit Judges.

OPINION OF THE COURT

COWEN, Circuit Judge.

Patricia Rogers and her two children (collectively "the Rogers" or "plaintiffs"), the appellants in this matter, are participants in the Tax Refund Intercept Program (TRIP), a federal program to intercept tax refunds from delinquent parents to satisfy their past-due child support obligations. The state and county agencies which implement TRIP in Pennsylvania intercepted $6,950.94, and held the funds for four months before distributing them to the Rogers.

The Rogers have requested interest on this child support money. They have brought this action pursuant to 42 U.S.C. § 1983 (1988) and directly under the Fifth and Fourteenth Amendments, asserting that by withholding interest, the government agencies have taken the plaintiffs' property without just compensation. We hold that any rights the plaintiffs may assert in this matter must flow from the federal statutes which create TRIP. Since neither the TRIP statutes nor the regulations promulgated thereunder require payment of interest on funds collected or held under the program, the legislation cannot be read to mandate the payment of interest or to deprive the plaintiffs of any property right. Accordingly, we will affirm the order of the district court.

I.

A.

The Tax Refund Intercept Program (TRIP) is a federal program which permits tax refunds to be intercepted to satisfy a variety of obligations owed by taxpayers, including child support obligations owed by delinquent parents. TRIP was established pursuant to Title IV-D of the Social Security Act, 42 U.S.C. § 654 (1988), and the Internal Revenue Code, 26 U.S.C. § 6402(c) (1988). In Pennsylvania the program is formally administered by the Bureau of Child Support Enforcement (the Bureau), a division of the Department of Public Welfare (the Department). The Bucks County Domestic Relations Section (BCDRS) is responsible, under contract with the Bureau, for the operation of TRIP and the control and disposition of intercepted refunds in Bucks County, Pennsylvania. Administration of this federal program is thus carried out at the local level by state and county agencies. In exchange for complying with federal guidelines, the federal government reimburses the states for part of the operating costs of the TRIP program. 42 U.S.C. § 655(a)(2)(C) (1988).

Once a year each county submits to the Bureau a certified list of individuals who are in arrears for child support and the amount of the arrears. The Bureau submits this information to the federal Office of Child Support Enforcement (OCSE), which in turn sends a list to the IRS so that income tax refunds can be flagged for interception. After the IRS intercepts the funds, OCSE wires the funds to the Bureau.

Intercepted tax refunds are processed differently depending upon whether the money intercepted is owed to the Commonwealth or to the custodial parent, and on whether the refund is based on a single or joint tax return. In cases where the custodial parent and children receive welfare assistance under Pennsylvania's Aid to Families with Dependent Children (AFDC) program, the intercepted funds are owed to the Commonwealth as reimbursement for its assistance and paid directly to the Department of Public Welfare. In non-AFDC cases, the funds are owed to the custodial parent. The Commonwealth receives the intercepted funds and mails a check directly to the County Domestic Relations Section. In Bucks County, the intercepted funds are held in a non-interest-bearing judiciary support account pending distribution to the family.

When refunds are intercepted from joint returns, the county may delay distribution to the custodial parent for up to six months. 42 U.S.C. § 664(a)(3)(B) (1988). ¹ The delay is authorized to enable the unobligated spouse, who has filed jointly with the delinquent parent, to file an amended tax return and claim a portion of the refund as exempt from interception. The six month delay is intended to ensure that the unobligated spouse has received his or her share of the refund. Id.; 45 C.F.R. 303.72(h)(5) (1991).

The state is permitted under the Social Security Act to charge a fee of $25.00 to individuals applying for assistance under the TRIP program. 42 U.S.C. § 664(b)(2)(B); 45 C.F.R. § 303.72(i)(2) (1991). See also 45 C.F.R. §§ 302.33(c) (1991). This intercept fee is automatically deducted from the support money paid to the children, and the delinquent parent receives full credit for the amount intercepted.

B.

Patricia A. Rogers and Gregory M. Rogers were married in 1970 and divorced in 1980. They had two children. Following the divorce, Mr. Rogers remarried. Mr. Rogers failed to make child support payments required by a support order entered in Bucks County, Pennsylvania. By June 1989 he had accrued arrears totalling $8,867.71.

The Department of Public Welfare received child support money from Mr. Rogers in two installments. On May 9, 1990, the Bureau received $6,126.86 intercepted from Mr. Rogers' 1987 federal income tax return, and on June 3, 1990 it received $124.14 and $2,183 intercepted from his 1988 and 1989 tax returns. The Bureau sent these funds to the BCDRS on July 16, 1990. BCDRS held a total of $8,433.14 in a non-interest-bearing account for four months. Jennifer Rogers, the unobligated spouse, sent a letter to BCDRS stating that she did not contest the interception and application of the refund toward her husband's support arrearage. BCDRS paid the plaintiffs a total of $6,950.94 without interest. ² The plaintiffs were charged $50.00 ($25 for each intercept) which was deducted from the support payment. ³

On an aggregate level, TRIP intercepts millions of dollars. Between 1985 and 1990, Pennsylvania collected over $34.7 million in child support under TRIP for 64,096 cases. Approximately $14 million was collected for 19,978 non-AFDC cases. The County Domestic Relations Sections are not required to hold these funds in interest-bearing accounts. The Bucks County Domestic Relations Section held TRIP funds in a non-interest bearing account. In twenty or twenty-one counties that did hold TRIP funds in interest-bearing accounts, earned interest was not paid to the participating families but was instead retained by the counties.

The Rogers have requested interest on the child support money that was recovered for them under TRIP, and which the county held for four months. They brought this action pursuant to 42 U.S.C. § 1983 and directly under the Fifth and Fourteenth Amendments, seeking damages, equitable relief and attorney's fees for the unlawful taking of their property without compensation and without due process under TRIP. Suit was filed individually and on behalf of a plaintiff class of all persons, parents, guardians and minor children for whom income tax refunds had been offset or intercepted. The defendants to the suit are the Bucks County Domestic Relations Section (BCDRS), the Commonwealth of Pennsylvania, the County of Bucks, and several officials of these government entities. ⁴

The district court granted the defendants' motion for summary judgment, dismissed the complaint, and denied the plaintiffs' motion for class certification as moot. Rogers v. Bucks County Domestic Relations Section, 773 F.Supp. 768 (E.D.Pa.1991). The court held that the Rogers had no property interest in the tax refunds which were intercepted on their behalf under the TRIP program. Id. at 775.

The district court found that the plaintiffs, when relying upon the government defendants to intercept and pay over a delinquent spouse's income tax refund to satisfy a child support arrearage, did not possess the rights granted the beneficiary of a trust under state common law. Id. at 773. Finding that the plaintiffs' complaint failed to state a cause of action for retroactive relief in the form of compensation...