(a) The department, in coordination with financial institutions doing business in this state, shall operate a Financial Institution Data Match System utilizing automated data exchanges to the maximum extent feasible. The Financial Institution Data Match System shall be implemented and maintained pursuant to guidelines prescribed by the department. These guidelines shall include a structure by which financial institutions, or their designated data-processing agents, shall receive from the department the file or files of past-due support obligors compiled in accordance with subdivision (c), so that the institution shall match with its own list of accountholders to identify past-due support obligor accountholders at the institution. To the extent allowed by the federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193), the guidelines shall include an option by which financial institutions without the technical ability to process the data exchange, or without the ability to employ a third-party data processor to process the data exchange, may forward to the department a list of all accountholders and their social security numbers, so that the department shall match that list with the file or files of past-due support obligors compiled in accordance with subdivision (c).

(b) The Financial Institution Data Match System shall not be subject to any limitation set forth in Chapter 20 (commencing with Section 7460) of Division 7 of Title 1 of the Government Code. However, any use of the information provided pursuant to this section for any purpose other than the enforcement and collection of a child support delinquency, as set forth in Section 17450, shall be a violation of Section 17212.

(c) (1)  Until implementation of the California Child Support Automation System, each county shall compile a file of support obligors with judgments and orders that are being enforced by local child support agencies pursuant to Section 17400, and who are past due in the payment of their support obligations. The file shall be compiled, updated, and forwarded to the department, in accordance with the guidelines prescribed by the department.

(2) The department shall compile a file of obligors with support arrearages from requests made by other states for administrative enforcement in interstate cases, in accordance with federal requirements pursuant to paragraph 14 of subsection (a) of Section 666 of Title 42 of the United States Code. The file shall include, to the extent possible, the obligor’s address.

(d) To effectuate the Financial Institution Data Match System, financial institutions subject to this section shall do all of the following:

(1) Provide to the department on a quarterly basis, the name, record address and other addresses, social security number or other taxpayer identification number, and other identifying information for each noncustodial parent who maintains an account at the institution and who owes past-due support, as identified by the department by name and social security number or other taxpayer identification number.

(2) Except as provided in subdivision (j), in response to a notice or order to withhold issued by the department, withhold from any accounts of the obligor the amount of any past-due support stated on the notice or order and transmit the amount to the department in accordance with Section 17454.

(e) Unless otherwise required by applicable law, a financial institution furnishing a report or providing information to the department pursuant to this section shall not disclose to a depositor, accountholder, codepositor, or coaccountholder, that the name, address, social security number, or other taxpayer identification number or other identifying information of that person has been received from, or furnished to, the department.

(f) A financial institution shall incur no obligation or liability to any person arising from any of the following:

(1) Furnishing information to the department as required by this section.

(2) Failing to disclose to a depositor, accountholder, codepositor, or coaccountholder, that the name, address, social security number, or other taxpayer identification number or other identifying information of that person was included in the data exchange with the department required by this section.

(3) Withholding or transmitting any assets in response to a notice or order to withhold issued by the department as a result of the data exchange. This paragraph shall not preclude any liability that may result if the financial institution does not comply with subdivision (b) of Section 17456.

(4) Any other action taken in good faith to comply with the requirements of this section.

(g) (1) With respect to files compiled under paragraph (1) of subdivision (c), the department shall forward to the counties, in accordance with guidelines prescribed by the department, information obtained from the financial institutions pursuant to this section. No county shall use this information for directly levying on any account. Each county shall keep the information confidential as provided by Section 17212.

(2) With respect to files compiled under paragraph (2) of subdivision (c), the amount collected by the department shall be deposited and distributed to the referring state in accordance with Section 17458.

(h) For those noncustodial parents owing past-due support for which there is a match under paragraph (1) of subdivision (d), the amount past due as indicated on the file or files compiled pursuant to subdivision (c) at the time of the match shall be a delinquency under this article for the purposes of the department taking any collection action pursuant to Section 17454.

(i) A child support delinquency need not be referred to the department for collection if a jurisdiction outside this state is enforcing the support order.

(j) (1) Each county shall notify the department upon the occurrence of the circumstances described in the following subparagraphs with respect to an obligor of past-due support:

(A) A court has ordered an obligor to make scheduled payments on a child support arrearages obligation and the obligor is in compliance with that order.

(B) An earnings assignment order or an order/notice to withhold income that includes an amount for past-due support has been served on the obligated parent’s employer and earnings are being withheld pursuant to the earnings assignment order or an order/notice to withhold income.

(C) At least 50 percent of the obligated parent’s earnings are being withheld for support.

(2) Notwithstanding Section 704.070 of the Code of Civil Procedure, if any of the conditions set forth in paragraph (1) exist, the assets of an obligor held by a financial institution are subject to levy as provided by paragraph (2) of subdivision (d). However, the first three thousand five hundred dollars ($3,500) of an obligor’s assets are exempt from collection under this subdivision without the obligor having to file a claim of exemption.

(3) If any of the conditions set forth in paragraph (1) exist, an obligor may apply for a claim of exemption pursuant to Article 2 (commencing with Section 703.510) of Chapter 4 of Division 2 of Title 9 of Part 2 of the Code of Civil Procedure for an amount that is less than or equal to the total amount levied. The sole basis for a claim of exemption under this subdivision shall be the financial hardship for the obligor and the obligor’s dependents.

(4) For the purposes of a claim of exemption made pursuant to paragraph (3), Section 688.030 of the Code of Civil Procedure shall not apply.

(5) For claims of exemption made pursuant to paragraph (3), the local child support agency responsible for enforcement of the obligor’s child support order shall be the levying officer for the purpose of compliance with the provisions set forth in Article 2 (commencing with Section 703.510) of Chapter 4 of Division 2 of Title 9 of Part 2 of the Code of Civil Procedure except for the release of property required by subdivision (e) of Section 703.580 of the Code of Civil Procedure.

(6) The local child support agency shall notify the department within two business days of the receipt of a claim of exemption from an obligor. The department shall direct the financial institution subject to the order to withhold to hold any funds subject to the order pending notification by the department to remit or release the amounts held.

(7) The superior court in the county in which the local child support agency enforcing the support obligation is located shall have jurisdiction to determine the amount of exemption to be allowed. The court shall consider the needs of the obligor, the obligee, and all persons the obligor is required to support, and all other relevant circumstances in determining whether to allow any exemption pursuant to this subdivision. The court shall give effect to its determination by an order specifying the extent to which the amount levied is exempt.

(8) Within two business days of receipt of an endorsed copy of a court order issued pursuant to subdivision (e) of Section 703.580 of the Code of Civil Procedure, the local child support agency shall provide the department with a copy of the order. The department shall instruct the financial institution to remit or release the obligor’s funds in accordance with the court’s order.

(k) Out of any money received from the federal government for the purpose of reimbursing financial institutions for their actual and reasonable costs incurred in complying with this section, the state shall reimburse those institutions. To the extent that money is not provided by the federal government for that purpose, the state shall not reimburse financial institutions for their costs in complying with this section.

(l) For purposes of this section:

(1) “Account” means any demand deposit account, share or share draft account, checking or negotiable withdrawal order account, savings account, time deposit account, or a money market mutual fund account, whether or not the account bears interest.

(2) “Financial institution” has the same meaning as defined in paragraph (1) of subsection (d) of Section 669A of Title 42 of the United States Code.

(Added by Stats. 2004, Ch. 806, Sec. 6. Effective January 1, 2005.)