Oregon Child Support Guideline Review Changes With the Deficit Reduction Act of 2005 Mandates

1. Oregon Child Support Guideline Review Changes With the Deficit Reduction Actof 2005 Mandates To Be Implemented 10/1/07

2. Process and Scale This training provides guidance on the changes to the Oregon guidelines from the 2006 guidelines review and the mandated changes from the Deficit Reduction Act of 2005. The training assumes that the participant has a basic understanding of the guideline rules, calculations and worksheets.

3. Process and Scale The Oregon Child Support Guidelines are reviewed in accordance with a requirement of the Family Support Act of 1988 [P.L. 100-485]. Federal regulations [45 CFR 302.56] further require that the review include an assessment of the most recent economic data on child-rearing costs and a review of case data to ensure that deviations from the guidelines are limited.

4. Process and Scale Under ORS 25.270, the Department of Justice, Division of Child Support (DCS) is charged with establishing the formula for calculating child support. The statute also mandates that the formula be reviewed once every four years, to ensure that the application of the formula results in appropriate child support awards.

5. Process and Scale In 2006, DCS convened a guidelines advisory committee to review potential changes to the guidelines. DCS also commissioned a policy study to review and update the scale of basic child support obligations.

6. Process and Scale Policy Studies, Inc. (PSI) completed the study and recommended a new scale based on national economic and statistical data on the cost of raising children in intact households. This study addressed the core of the guidelines, the Schedule of Basic Child Support Obligations, and recommended an updated Schedule based on expenditures data collected in 1998-2004 and updated to 2006 prices, tax rates and poverty levels.

7. Guidelines Advisory Committee Recommended Changes

8. 137-050-0320 Definitions Child Attending School The definitional rule was updated to include a reference to ORS 107.108 and OAR 137-055-5110 for a child attending school (CAS). Non-Joint Child The definition for a non-joint child was amended to include the scenario when one of the children is in state care and mom/dad have a child in the household. With the change in the definition a one parent order can be calculated instead of having to apply a rebuttal for the child still in the household.

9. Process and Scale

10. 137-050-0333 Rebuttals Case Law Cites Case law cites were added to many of the rebuttal commentaries to help practitioners with the intent of the rule and how it has been applied in the state. Reunification Plan Specific language was added to the rebuttal commentary on section (1)(f) for Child Welfare/Oregon Youth Authority cases to address the needs of a parent who is trying to comply with specific requirements of a reunification plan or other agreement to reunite with the child(ren).

11. Process and Scale Wants vs. Needs of Child Much discussion was presented on the topic of the wants of a child (or his/her parents) vs. the actual needs of a child. The scale is based on the actual basic cost (needs) of raising a child and does not factor in costs beyond meeting the basic needs of a child. Commentary was added in several of the guideline rules to remind fact finders that the scale only covers the needs of a child and that additional wants should be a matter settled between the parties.

12. Process and Scale Child�s disability benefits The fact finder cannot include the benefits that the child receives for his/her own disability in the child support calculation. This is addressed in OAR 137-050-0333(1)(g) commentary. The amendment clarifies that a child can receive SSI, but not social security.

13. Potential to Earn Under (j) financial advantage, the fact finder may look at a party�s potential to earn income amount when the party chooses to not work due to a spouse�s or domestic partner�s income. Joint Debts Commentary for section (n) was amended due to HB 2306 (2005), which took out the distinction that the parties had to have lived together to have incurred joint debts.

14. Process and Scale Stipulated Agreements Case law states that parties can stipulate to child support amounts but that the stipulation is not binding on the court, it is just one of the factors the court can consider. The following language, �included but not limited to� was added to the rule. The commentary was updated to reflect that the rebuttal list is not an exhaustive list and that the court may consider other appropriate factors not listed. Much discussion was given to adding a new rebuttal for �stipulated agreements�. The final decision was to add language as noted above to the rule that acknowledges that the fact finder can look at other situations that are not included in the rule. Adding the above language acknowledges case law while not adding a new rebuttal to the rule.

16. 137-050-0335 Implementation Use existing guidelines The change allows for any pending matter to use the past guidelines in effect at the time that the order was taken but if an order is modified or sent for hearing after the effective date of the rule the new guidelines should be applied. Currently, when determining past support the fact finder must look to the guidelines in use at that time but use the current income of the parties. A decision was made that the fact finder can use the current guidelines to determine past support. If the court, or Administrative Law Judge (ALJ) chooses, the past guidelines can be used.

17. Process and Scale Accelerated Depreciation vs. Regular Depreciation Regular depreciation allows for a set amount of depreciation averaged over a certain number of years. Accelerated depreciation allows a person to front-load the depreciation to take more at the beginning and then before it totally depreciates in a lesser amount of years the person will normally sell or otherwise get rid of it and start all over again.

18. 137-050-0400 Nonjoint Children TANF Currently, an obligee on public assistance (TANF) does not get a non-joint child credit for a joint child in the household. The reason credit was not given was because the state is covering the needs for that child. However, if the point is to get a child support order that is as accurate as possible to help the family become self-sufficient where the needs of the child would not be covered by the state then a non-joint child credit should be given. The rule was amended to allow for a non-joint child credit. Mandatory Union Dues When determining modified gross income any payment due to spousal support and any mandatory union dues is subtracted. When determining a credit for non-joint child the rule only speaks as to subtracting spousal support but did not include the mandatory union dues. The change makes both parts of the rule consistent

19. Process and Scale Example to prorate health care coverage costs Practitioners have requested an example be put into commentary to help understand how to prorate the cost of health care coverage when there are more people on the coverage than the joint child.

20. 137-050-0420 Child Care Costs Future child care costs The rule has been changed to mimic health care coverage costs. If the child care cost is documentable and determinable at the time that the order is being calculated then the child care costs should be calculated and a credit given.

21. Process and Scale Administrative Law Judge (ALJ) Actual PT The rule is being amended to allow the ALJ to find actual parenting time during the hearing and be able to use that information to determine the correct parenting time credit. This will allow the ALJ to make an actual finding instead of having to use a rebuttal. What it does not do is change the parenting time agreement. If the parties want to change the written agreement they will have to go to court or stipulate to a new written agreement.

22. Process and Scale Two Year Average Because parenting time often changes over the course of two years based on which parent gets which holidays for that year it was determined that using a two year average would be the most correct method of determining the one year time. Child Attending School The advisory committee made a recommendation that parenting time not be determined for a child attending school.

23. 137-050-0455 Parenting Time Credit 1.5 Multiplier at 25% Parenting Time (PT) The advisory committee looked at many parenting time schedules used throughout the nation and after much discussion and reviewing the charts presented by Policy Studies Inc. determined that using a 1.5 multiplier would result in the most equitable credit to the parties. PT beginning at 25% was used because the average PT agreements county-wide start at 24%.

24. Process and Scale Self-Support Reserve - $953 The self-support reserve was increased to match federal poverty levels: $817 = 2006 poverty level� (this is a net income amt) $953 = Grossed up equivalent of $817 using the 2006 State and Federal taxes and FICA

25. 137-050-0490 The Oregon Child Support Program commissioned a study for an updated scale. The new scale is based on expenditure data collected in 1998-2004 updated to 2006 prices, tax rates and poverty levels.

26. Deficit Reduction Act of 2005 (DEFRA) Changes to Guidelines

27. ORS 25.321 (6) �Medical support� means an amount ordered to be paid toward the cost of: (a) Health care coverage, including premiums, provided by a public entity or by another parent through employment or otherwise; and (b) Copayments, deductibles and other medical expenses not covered by a health benefit plan.

28. ORS 25.321 (10) �Providing party� means a party to a child support order who has been ordered by the court or the enforcing agency to provide health care coverage for a child or to provide such coverage when it becomes available to the party.

29. ORS 25.323 (2) In addition to ordering health care coverage �, the court or enforcing agency MAY order one or both parties to pay medical support for the child. Medical support ordered under this subsection must be reasonable in cost.

30. ORS 25.323 (3) If the court or the enforcing agency finds that the parties cannot provide satisfactory health care coverage because satisfactory health care coverage that is reasonable in cost and accessible to the child is not available at the time the child support order is entered, the court or the enforcing agency:

31. ORS 25.323 (a) SHALL order one or both parties to provide satisfactory health care coverage that is reasonable in cost and accessible to the child when the coverage becomes available; and (b) MAY order that, until the court or enforcing agency determines that satisfactory health care coverage that is reasonable in cost and accessible to the child is available and modifies the order, one or both parties pay medical support that is reasonable in cost. The court or enforcing agency SHALL make written findings on whether to order the payment of medical support under this paragraph.

32. ORS 25.323 (4) The cost of any amount ordered to provide satisfactory health care coverage and medical support under this section must be included in the child support calculation made under ORS 25.275. (5) The court or enforcing agency may not order a party to pay medical support under this section if the party is eligible to receive medical assistance under ORS 414.032, or has a dependent child in the household who is eligible to receive medical assistance under ORS 414.032.

33. ORS 25.323 (6) The Department of Justice shall adopt rules for determining the reasonableness of the cost of satisfactory health care coverage and of medical support for the purposes of this section, and for determining how the costs of providing health care coverage and medical support affect the total support obligation for a child under ORS 25.275.

34. 137-050-0320 Definitions Cash Medical Support Cash medical support incorporates the currently existing �out of pocket medical expenses� over $250 per child per year and adds any payment towards the cost of public health care coverage. Cash medical support is the federal term for these expenses while HB 2125 uses �medical support� to mean cash medical support. The administrative rule clarifies that cash medical support has the meaning found in statute for medical support but for purposes of the guidelines rules also means cash medical support

35. Process and Scale Medical Child Support Medical Support Medical child support is the umbrella term used in Oregon for health care coverage and cash medical child support provisions. The federal umbrella term is �medical support� but that term is being used in Oregon statutes to mean cash medical support.

36. Process and Scale Providing Party A providing party is the person ordered to provide health care coverage and/or cash medical support and can be either an obligee or an obligor. Appropriate Health Care Coverage Before health care coverage can be ordered it has to be found to be appropriate. Under federal law �appropriate� is a three prong finding. Because an earlier compromise was made with partners the Child Support Program did not take �satisfactory� out of the current statute but instead incorporated it into one of the three prongs of appropriate. That is why the fact finder will see �satisfactory health care coverage� in the statutes.

37. 137-050-0410 Health Care Coverage Appropriate (three prongs): Accessible Must be within 30 minutes or 30 miles, no service area restrictions and includes a new addition that allows a fact finder to look at the work history of the party to see, if health care coverage is ordered, would it be available for at least a year. If not, then a fact finder may make a determination that private health care coverage is not accessible. Reasonable in Cost Reasonable in cost is based on the federal requirement to have a numeric formula based on income using a percentage to determine a cap for when the cost of health care coverage is reasonable and should/could be ordered. The guidelines evaluates the pro-rated share of the premium cost against the cap to determine if reasonable in cost. Comprehensive Comprehensive is currently set out in statute as �satisfactory� and incorporates the statutory definition of satisfactory.

38. 137-050-0410 Health Care Coverage (HCC) Fact Finder � Tier for decision making Obligor Private HCC Obligee Private HCC Both Private HCC � Obligee Chooses Neither Private HCC � Public HCC Cash Medical Support Out of Pocket Medical Expenses Reimbursement for Public HCC

39. Process and Scale The guidelines adopts the federal tier for determining when private health care coverage (hcc) or public hcc and/or cash medical support should be ordered. A fact finder is now required to look at the resources of both parties before making a determination. The obligor should be considered first as to whether private hcc is available either through an employer, union, private method, or through a domestic partner, spouse or other family member residing with the obligor. Next, the obligee should be considered following the same requirements as set out for the obligor. If both have appropriate private hcc available the obligee can choose who will be ordered to provide hcc. If neither has appropriate hcc then the obligee will be ordered to apply to enroll in public hcc (even if she/he is already receiving public hcc) and then obligor may be ordered to provide cash medical support to help reimburse for the cost of the public hcc. If private hcc is ordered and there are out-of-pocket medical expenses above the $250 per child per year these expenses can be factored into the calculation and may result in an amount to be ordered for cash medical support.

40. 137-055-0430 Cash Medical Support Reasonable in Cost The cost for cash medical support must also be capped at the same reasonable in cost formula used for health care coverage. Unlike health care coverage though, cash medical support can be ordered up to the cap. Cash Medical Support includes both: Out-of-Pocket Medical Expenses Reimbursement for Public HCC costs Private HCC and Medical Expenses Cash medical support for out-of-pocket medical expenses can be ordered in addition to private health care coverage. Obligor or child in obligor�s household exempt As set out in the statute, if an obligor or a child in the obligor�s household is eligible for medical assistance the obligor can not be ordered to provide cash medical support.

41. Calculation of Support WORKSHEETS

42. THE CALCULATION The CSCW* worksheets for joint minor child and child attending school have been combined as the guidelines now address computation for child attending school. *CSCW, Child Support Computation Worksheet [CSF 02 0809A]

43. THE CALCULATION In addition to the main child support calculation worksheet there are now six supplemental worksheets, as follows: S-1 Parenting Time for Joint Minor Child(ren) S-2 Parenting Time Credit S-3 Child Care Credit Computations S-4 Rebuttal Evaluation S-5 Private Health Care Coverage Costs S-6 Cash Medical Support

44. Child Support Computation Worksheet The worksheet now calculates an obligation for both joint minor children and joint children attending school. Line 9a is the basic support obligation for the minor children. Line 9b is the basic support obligation for the child attending school.

45. The cost section has been broken out between minor children and children attending school. This first section allows for the child care credit for the joint minor child and any rebuttals to costs.

46. This section allows for rebuttal costs for the child attending school. The Child Support Program is aware that the new worksheet allows the child attending school to receive a pro-rated share of the joint minor child�s child care costs and rebuttals. This issue will be addressed in another forum.

48. S-2 Parenting Time

49. S-4 Rebuttal Worksheet

50. S- 5 Health Care Coverage

51. S-6 Cash Medical Support

52. FORMS

53. Notice of Financial Responsibility (NFR)

54. NFR Continued

55. MONEY AWARD

56. Scenario with an alternate ending Obligor $4550 monthly Obligee $1350.96 monthly (minimum wage) 2 joint minor children 1 child attending school (CAS) Obligor 1 nonjoint child Obligor spousal support to obligee $500 monthly Parenting time credit (30% obligor) Child care costs - $400 monthly CAS rebuttal of costs � obligor $35 monthly Obligor appropriate private health care coverage $225 (child�s portion) Obligee out-of-pocket medical expenses $55 monthly Alternate ending: No private health care coverage Obligee public health care coverage Cash medical support for public health care coverage ordered

57. Determine Parent A and Parent B (click on red box to go to S-1) Indicate the number of joint children Enter each parent�s gross monthly income Enter spousal support Determine modified gross income Enter non-joint children and determine the credit Determine adjusted gross income and combined income Determine percentage share of income

58. To determine the basic child support obligation click on the red box to go to the scale To determine the obligation amount for the joint minor children divide line 9 by the total number of joint children (3), and multiply that figure by the number of joint minor children To determine the obligation amount for the child attending school you subtract line 9a from line 9 Determine each parent�s pro rata basic obligation for the joint minor children by multiplying each parent�s percentage share of income and line 9a For line 10a click on the red box to go to supplemental worksheet S-2 to determine each parent�s obligation after the parenting time credit

59. Determine each parent�s single obligation for the joint minor children using the scale for each parent�s modified gross monthly income, divided by the number of joint children and multiplied by the number of joint minor children. Click on the red box to go to the scale On line 12 enter the lesser obligation from line 10a or line 11

60. Determine the amount of child care costs credit by using supplemental worksheet S-3. Click on the red box to go to the S-3. The child care credit and any rebuttal costs are added together. The costs are then pro rated between the parties The total net costs are set out on line 13f.

61. Determine each parent�s pro rata share of the joint child attending school obligation by multiplying lines 8 and 9b for each parent. Determine the low income adjustment for the child attending school obligation by taking each parent�s single obligation amount, dividing it by the number of joint children and multiplying by the number of joint children attending school. Enter the lesser of line 14 or line 15. Enter any rebuttals for a child attending school from supplemental worksheet S-4 and pro rate the costs between the parents. Click the red button to go to the S-4

62. Determine the net costs owed by subtracting line 17b from line 17c and enter this amount in Parent B�s column. Determine the monthly child support obligation for the child attending school by adding lines 16 and 17d for each parent.

63. At this point in the calculation we bring the obligation for the joint minor child and the joint child attending school together to complete the rest of the worksheet. Line 18 gathers the figures from lines 12, 13f and 17e for each parent and adds or subtracts as appropriate. Line 18 is the total net child support obligation after costs for both joint minor children and joint children attending school.

64. Medical child support costs for private health care coverage and cash medical support and the impact on the child support obligation is determined on the supplemental worksheets and the obligation amount is brought back to the main worksheet. Click on the red box next to this line to go to the S-5 to determine if private health care coverage is reasonable in cost. Click on the red box next to this line to go to the S-6 to determine the cash medical support amount.

65. Determine the monthly obligation with benefit adjustments by subtracting line 21 (if any) from the obligation amount on line 20. Next we determine the self support reserve for each parent by entering the parent�s modified gross monthly income and subtracting $953. The monthly child support obligation is the lesser of line 22 or line 23c. The total monthly child support obligation on line 25 is plus or minus any rebuttal amounts on line 24a. The final monthly child support obligation amount for obligee is the amount that could be ordered for obligee to pay the child attending school. The final monthly child support obligation amount for obligor is the amount to be paid for the joint minor children and the child attending school. Click here to continue

66. The Calculation- Determining Parent A and Parent B If the parties do not have either a written agreement or a court order that provides for parenting time, Parent A is the parent who provides the primary residence for the child(ren) and is responsible for the majority of day-to-day decisions concerning the child(ren). If the parties have either a written agreement or court order providing for parenting time, Parent A and Parent B are determined by completing supplemental worksheet S-1. If the child is in the physical custody of the State of Oregon or another person who is not the parent of the child, the parent for whom you are calculating support is Parent B. There will be no Parent A in the calculation and no figures or income should be entered in the column for Parent A.

67. Enter the number of overnights with each parent for the joint minor children only. Total the overnights with each parent. Multiply the number of joint minor children by 365. Divide the total of each parent�s overnights by the figure on line 12 to determine each parent�s percentage time. The parent with the largest percentage time of overnights is Parent A. When finished click on the red box to return to the main worksheet.

68. Enter each parent�s percentage share of income from the main worksheet. Enter each parent�s pro rata share of the basic obligation for the minor children from the main worksheet. Enter the total obligation amount for the minor children from the main worksheet. Multiply the basic minor children obligation amount by 1.5. Click to go to the next page for the rest of the S-2.

69. Multiply line 5 (the 1.5 multiplier) by each parent�s percentage share of income from line 1 to determine each parent�s share. From the S-1 enter the percentage time spent with the children for each parent. Multiply line 6 by line 7 to get the parenting time credit. Enter each parent�s pro rata minor child obligation from line 10 of the main worksheet. Subtract line 8 from line 9 and transfer the minor child obligation amount back to the main worksheet. Click on the red box to return to the main worksheet

70. Enter the amount of the monthly child care cost in the column of the parent who incurs the cost on line 1. Line 2 determines the amount of federal and state tax credit that will be subtracted from the child care costs (the tax credit charts are included on the S-3 but were not added to this slide due to amount of space needed). Line 6 subtracts the amount of tax credits from the monthly child care cost on line 1 and this amount is transferred back to the main worksheet. Click on the red box to return to the main worksheet

71. Enter any amounts for costs for the child attending school in the column of the parent paying the cost. Costs for child attending school must be entered in the bottom row of the �costs� rebuttal column. Click the red button to transfer the rebuttal totals back to the main worksheet.

72. To determine if private health care coverage is reasonable in cost enter each parent�s adjusted gross income and each parent�s percentage share of income from the main worksheet. Enter the cost of the private health care coverage (cost to enroll the child(ren) only) in the column of the parent who is or will be ordered to provide private health care coverage. Determine each parent�s pro rata share of the cost by multiplying each parent�s percentage share of income on line 2 by the cost in line 3. The reasonable in cost cap is determined by multiplying each parent�s line 1 by 7%. Click to go to the next page to finish the S-5.

73. The cost of private health care coverage is reasonable in cost if the providing party�s pro rata share (in this case obligor�s) on line 4 is less than or equal to line 5 (the reasonable in cost cap). Private health care coverage is reasonable in cost. Enter the amounts from line 4 in each parent�s column in line 6a. The net child support obligation for each parent from line 18 on the main worksheet is entered on line 7. Parent B is providing the private health care coverage so Parent A�s pro rata share of the costs is subtracted from the monthly child support obligation. The total net child support obligation amount from line 7 for Parent A and line 8b for Parent B is transferred back to the main worksheet. Click on the red button to return

74. Each parent�s adjusted gross income and percentage share of income is transferred over from the main worksheet. The reasonable in cost cap is determined on line 3 by multiplying each parent�s line 1 by 7%. The costs for out-of-pocket medical expenses are entered on line 4a for each parent. The pro rata share of the costs is determined on lines 5a and 5b by multiplying each parent�s line 2 by the costs in 4a. Click to go to the next page to complete the S-6.

75. If Parent A�s line 5a and Parent B�s line 5b is less than or equal to the reasonable in cost cap in line 3 for each parent enter each parent�s line 5a and 5b on line 6a. Transfer the net child support obligation from the main worksheet to line 7. Subtract Parent A�s pro rata share of costs in line 6a from Parent B�s line 7. Add Parent B�s pro rata share of costs in line 6a to the amount in line 8. Transfer the net child support obligation amounts from Parent A�s line 7 and Parent B�s line 9 back to the main worksheet. Click on the red button to return

76. The Calculation Alternate Ending Private health care coverage not reasonable in cost Obligee ordered to apply to enroll for public health care coverage Cash medical support ordered as reimbursement towards the cost of public health care coverage

80. Transfer the net child support obligation amount from the main worksheet to line 7. The pro rata share of the cost of the private health care coverage was greater than the 7% cap so the obligation amount is not impacted. Carry Parent B�s line 7 down to line 8b. Transfer the amounts in Parent A�s line 7 and Parent B�s line 8b back to the main worksheet. Click the red button to return to the main worksheet

83. Obligee�s modified gross is $1850.96. With three joint children the single obligation amount is $593. Obligor�s modified gross is $4050. With three joint children the single obligation amount is $1198. Click on the red box to return to the main worksheet.

84. The combined income is $5196.96 and there are three children. The total child support obligation amount is $1356. (click on red button to return to main worksheet)

85. For questions please contact Shawn Brenizer via email at: shawn.brenizer@doj.state.or.us or via telephone at: (503) 986-6240 Go to the next slide for information regarding CLE credit and a Certificate of Completion The Calculation

86. Congratulations You have completed the Child Support Program�s online training for guideline changes from the Guidelines Advisory Committee and DEFRA. This program has been approved for 0.75 general/practical skills MCLE credit by the Oregon State Bar For a Certificate of Completion click on the link below.