Activists say the state is, in effect, stealing money that should go to single parents owed child support.
But the heart of the problem is a state policy designed to make sure the government doesn't get stuck with the tab when a refund is ordered.
The Association for Children for Enforcement of Support held a press conference in Reno on Monday demanding a federal investigation because the state has not released federal income tax refunds and unemployment checks withheld from deadbeat parents.
IRS checks and unemployment benefits of parents who owe child support are collected by the state so that the money can be sent to the parents raising the children.
State Welfare Director Myla Florence said there is no misuse of funds and no child support payments are being used to operate the child support program. She said those payments are in a separate account and are kept only until they can be distributed to the parents in each case.
She said it's unfortunate that the state child support system is being criticised for something it does far better than the old system - collect IRS and unemployment checks from deadbeat parents.
"Collections under NOMADS are running better than ever before," she said.
The issue was raised during a steering committee meeting last week by Washoe County Deputy District Attorney Maddie Shipman.
She objected to the state's policy of holding those checks up to six months in case they are ordered to refund part of the money to the non-custodial parent. Florence said that is a decision the Legislature made to avoid costs to the state.
She said the non-custodial parent can appeal to get some of the money back, and that person's new spouse also has a claim on the refund. But she said if the state releases the money and is later told some of it should be returned, it's the state's responsibility to either get the money back or make up the difference.
Washoe officials say holding up the checks delays payment to those who can least afford it - the custodial parents raising the children - and that the state should simply pass the money through to the parents who need it.
Florence said IRS collections for child support are running at a record rate. In fact, welfare officials received permission from the Interim Finance Committee last week to release up to $6.3 million in IRS collections and $1.5 million more in unemployment check money to parents owed child support by the end of the fiscal year.
