CFR > Title 45 - Public Welfare > SUBTITLE B—Regulations Relating to Public Welfare > CHAPTER II—OFFICE OF FAMILY ASSISTANCE (ASSISTANCE PROGRAMS), ADMINISTRATION FOR CHILDREN AND FAMILIES, DEPARTMENT OF HEALTH AND HUMAN SERVICES (parts 200 to 288) > PART 264—OTHER ACCOUNTABILITY PROVISIONS > SUBPART A—What Specific Rules Apply for Other Program Penalties? (§264.1 to §264.50) > 264.31—What happens if a State does not comply with the IV-D sanction requirement?

264.31—What happens if a State does not comply with the IV-D sanction requirement?

(a) (1) If we find that, for a fiscal year, the State IV-A agency did not enforce the penalties against recipients required under § 264.30(c), we will reduce the SFAG payable for the next fiscal year by one percent of the adjusted SFAG.
(2) Upon a finding for a second fiscal year, we will reduce the SFAG by two percent of the adjusted SFAG for the following year.
(3) A third or subsequent finding will result in the maximum penalty of five percent.
(b) We will not impose a penalty if:
(1) The State demonstrates to our satisfaction that it had reasonable cause pursuant to § 262.5 of this chapter; or
(2) The State achieves compliance under a corrective compliance plan pursuant to § 262.6 of this chapter.