Working with Low-Income Cases: Lessons for the Child Support Enforcement System from Parents' Fair Share. C. Making Downward Modifications in the Child Support Obligation

05/01/1998

One of the most unusual elements of PFS is the downward modification of the support obligation while NCPs participated in the program. PFS asked for a commitment of time from the NCPs to participate in peer support and employment and training services; in exchange for this investment in the program, local staff could reduce the child support obligation to a minimum or even to zero. This approach differed from standard practice in CSE in two ways: normally, earnings could be imputed by courts when NCPs were unemployed and rarely would orders be modified without a formal request by an NCP and consideration of the issue in a special hearing on the motion to modify. (Importantly, modification normally could not be considered in contempt hearings.) Because this PFS change was such a break with normal practice, it was not uniformly implemented in all sites throughout the entire period of the demonstration.

Exhibit 10 describes the standard practices for modifying child support orders in each site, circumstances in which earnings are imputed, and special procedures during PFS. As the first column shows, in most of the sites modifications were usually made at the request of a parent. Periodic reviews of all cases are not yet a part of the administrative routine in most of the sites. Generally, there is a requirement that the change in circumstances be substantial (if defined, typically a change on the order of at least 10–15 percent), not temporary, and not voluntary (for example, quitting a job). In general, the modification requires some type of special hearing before a judge or hearing officer and cannot be considered as part of a contempt hearing. One reason for this separation of modifications and contempt actions is that since the notice of the contempt hearing does not alert the CPs that a change in the order is under consideration they might not attend or be prepared to address the issue.

Exhibit 10

Making Downward Adjustments in Child Support Orders for PFS Participants

Site

Usual Practice for Modifying Orders

Usual Practice for Imputing Income if NCP Unemployed

Special PFS Procedures

Duval County, FL (Jacksonville)

Modifications had to be made in hearing called for this purpose and could not be made as part of a contempt hearing. Modifications were made when in best interests of child (as defined in regulations) or when applications of guidelines would produce a change of at least 15 percent or $50, whichever was greater. Most modifications were made at a parent’s request.

Court imputed income if unemployment was voluntary and factors considered were physical and mental capacity to work and other circumstances over which NCP had no control. Court determined employment potential and probable earnings by reviewing work history, occupational qualifications, and prevailing earnings in community.

In practice, orders not consistently modified downward for PFS. Under the PFS plan, if NCP was unemployed and CP was currently receiving AFDC, NCP signed a consent agreement suspending child support obligation, and judge signed the consent order. If NCP was underemployed, his obligation was computed based on actual income rather than what would normally be imputed. When child support order was suspended, prior court order setting child support obligation still existed, but NCP did not have to pay on order and arrears did not accumulate. Court retained jurisdiction over the case and could reinstate old order if NCP did not follow through and participate in PFS.

Hampden County, MA (Springfield)

Modifications were made at request of a parent who had to file seeking order modification with court. Sometimes multiple modifications were scheduled in a block of time when there was room on docket. In a modification, if CP did not appear some judges would not go forward.

State guidelines called for using potential earnings if parent was earning substantially less than he could through reasonable effort. County practice was to consider what NCP was currently doing, and how and when he left his last job. If he was fired or voluntarily left last job, but not if laid off, income would be imputed.

Most NCPs referred to PFS involved new paternity cases and initial child support order was set at $50 per month. When a referral arose out of a modification request, order was reduced to amount NCP had requested or to an amount judged appropriate under guidelines by court. When an NCP was referred to PFS from a complaint hearing, judges were encouraged to reduce order to $50 per month, but this was not always done.

Kent County, MI

(Grand Rapids)

Under Michigan law, Friend of Court (FOC) reviewed and recommended modifications (1) upon request of either party not more than every two years in non-AFDC cases, (2) every two years in AFDC cases, and (3) whenever it was in best interests of child. If one party wanted a modification more often than every two years, he or she could ask court but there was no recommendation from FOC.

Court could impute income when parent voluntarily reduced income. In deciding whether to recommend imputation, FOC considered prior work experience, education, disabilities, presence of children in home and its impact on ability to earn, availability of employment, prevailing wages, special skills and training, and other evidence parent could earn imputed income.

For NCPs in PFS, court suspended enforcement of child support order and any payments on arrearages of state debt, rather than adjusting them downward. Technically, arrearages built during participation, but if NCP complied with program requirements these added arrearages were canceled. Orders in PFS cases were reviewed on request by either parent or PFS staff regardless of usual law on frequency of modifications.

Los Angeles County, CA (Los Angeles)

Court action was required to modify a child support order. For upward modifications, the district attorney issued an order to show cause to NCP for a hearing.

District attorney sought to impute earnings based on working 40 hours per week at minimum wage for unemployed NCPs, unless NCP was on disability or public assistance. Judges did not always follow these recommendations.

Stipulation an NCP signed on entering the program states that “zero amount” child support orders would remain in place during program participation and other orders will be reduced to $50 per month.

Mercer County, NJ (Trenton)

Either the agency or the NCP could file a motion for modification. If arrearages existed, agency also would file a motion for enforcement with a statement of arrearages. Parties appeared before a hearing officer and NCP ordinarily had to show long-term, involuntary change in circumstances to get a reduction. If either party objected to hearing officer's recommendation, case was referred to a judge for a same-day hearing.

State guidelines allow for imputation of earnings for unemployed NCPs, based on past work history and earnings and area wage surveys. In case of NCPs with low skills or little work history, courts can impute earnings based on full-time work at the minimum wage. In some cases, courts also impute income based on in-kind contributions NCP receives, such as free room and board.

The order requiring participation in PFS also reduced NCP’s child support obligation to a minimal amount ($15 per week for one child, $5 per week for each additional child) and payments on arrearages were also reduced (to $5 per week). In practice, payments on state arrearages were not enforced while someone participated in PFS. If NCP failed to participate, order stated that original (higher) order would be reinstated retroactively.

Montgomery County, OH (Dayton)

There was an administrative process to review requests for modifications when one of parents requested a review or when required 3-year review period was reached. Agency made a recommendation to court for its approval or rejection. Only changes in circumstances producing at least a 10 percent change in order were considered substantial enough to require a modification.

Past practice was automatic imputation of earnings of unemployed parents for whom court had no financial information. New state legislation shifted to case-by-case imputation, based on ability to earn, availability of employment appropriate for parent in community, and unemployment rate. But Montgomery County still imputed income (usually based on work at minimum wage) and set $50 per month minimum order unless parent was incarcerated or receiving SSI.

In Domestic Relations Court, order was temporarily reduced to $50 per month for 6 months, during period of PFS participation, or until NCP found a job. In Juvenile Court, prior order was suspended for a similar length of time, meaning that there was no current obligation to pay and arrearages did not build. In practice, these changes in order were not always made.

Shelby County, TN (Memphis)

If there was a change in circumstance that would produce at least a 15 percent change in order, case could be placed on court docket at request of a parent. A prehearing conference was held and agency staff encouraged parents to reach an agreement that could be put in form of a consent decree. If an agreement was reached, judge signed new order and hearing was not held.

Income was imputed on a case-by-case basis after questioning parent about prior employment and current job search efforts, and making a determination if he had ability to pay. Often, standard practice was to impute earnings based on full-time, minimum wage work. Sometimes court would consider education and impute higher earnings.

Family Court reduced child support order to $50 per month and then credited an NCP $50 per month for participating in PFS program. This approach, which differed from usual rule against in-kind payments, had been approved by HHS on condition court made a finding that applying guidelines would be inappropriate and a provision for credit toward support obligation in exchange for participation in PFS was included in order requiring participation in program. Orders did not consistently include this language.

In all of the PFS sites a procedure to impute earnings when NCPs were unemployed (shown in the second column of Exhibit 10) was routinely performed if the court found the unemployment "voluntary." Factors typically considered include the employability of the parent, the availability of work, and current job search efforts. One jurisdiction weighs heavily the reason for the loss of a prior job and does not impute income in the case of layoffs or plant shutdowns. Generally, imputed earnings are at least those produced by full-time work at the minimum wage.

PFS sites were to make changes in these modification and imputation practices by not imputing earnings, reducing the order, and handling all of these issues in a single review. The final column of Exhibit 10 shows special PFS procedures in each site. Generally, site staff developed a standard court order directing NCPs to participate in PFS and reducing their orders. Sites made the order reduction in one of two ways: (1) four sites made an actual reduction in the amount of the support obligation, issuing a new order that replaced the prior support order; (2) three sites suspended the current order while the parent participated in PFS (the existing order remained in place, but the obligation was not enforced and arrearages did not build).

It appears that the choice between these two methods was largely determined by local court practice and civil court procedures. Sites typically developed a plan to accomplish the reduction in the obligation in a way that required the smallest departure from past practice.

One important program implementation issue was embedded in the choice, however. Under either method, it was important for a site to develop a way to quickly put in place a normal support obligation if NCPs did not follow through and participate in PFS. In two sites where orders were suspended (Duval and Kent counties), the order to participate in PFS explicitly stated that the court retained jurisdiction and the old obligation would automatically be put in place if the NCPs did not comply with program requirements. In one site in which the order was actually reduced (Mercer County), the new order stated that the original (higher) order would be reinstated retroactively if the NCPs did not comply with program requirements. Either of these approaches provided sites a way to avoid lengthy procedures to reimpose an obligation on NCPs who fail to meet program requirements.

NCPs with multiple CSE cases posed special problems for sites seeking to reduce the support obligation during PFS. When one of an NCP’s CSE cases was not a "public-assistance-related" case, the support obligation could not be reduced without the agreement of the CP. No site attempted to put in place procedures to secure this agreement. However, complications could also arise when an NCP had multiple public-assistance-related cases unless all these cases were "consolidated" into a single hearing and the obligation reduced for each case. Further, if the site chose to reduce the obligation to some minimum amount (say $50 per month), NCPs with several cases could still find themselves facing an obligation of $100 per month or more. Thus, it is important to consider an NCP’s total support obligation and work to develop an adjustment that is as comprehensive as possible.