An act relating to child support awards…. SB 134 An act relating to child support awards….

Guests Stacy Steinberg – Attorney Generals Office, Collections and Support Section Dorothy Shockley – Legislative Aide to Senator Albert Kookesh

Agenda Legislative History and Background of SB 134 General Information about Child Support Nationwide Overview of Income Shares Model Process Distinguishing Features Fiscal Notes Example Calculations Discussion

Sponsor Statement SB 134 Senator Kookesh’s goals with putting child support guidelines into statute People affected by guidelines would have the opportunity to speak to lawmakers to make changes Bill proposes enactment of current rule into statute with the exception of how the child support obligation is calculated Changing to an income shares model calculates support as the share of each parent’s income estimated allocation to the child if the original household were intact.

SB 134 Timeline SB 134 is sponsored by Senator Kookesh. First introduced and read to the Senate on January 17, 2012 and was referred to the Health and Social Services Committee and the Judiciary Committee February 6, 2012 Health and Human Services Committee Meeting Sen. Kookesh stated that the advantage of putting child support into statute allows to be change “at the whim of the legislature” instead of every four years under the civil rules.

The bill came about due to frustrations following the statewide review process of Rule 90.3. 25.28.010 - guidelines for calculations regarding primary physical custody case. 25.28.020 - guidelines for shared, divided, and hybrid custody awards. 25.28.030 – margins of error in the economic table where exceptions may be needed

25.28.040 – health care expenses 25.28.050 – annual income documentation requirements 25.28.060 – travel expenses 25.28.070 – modification to child support awards 25.28.080 – third party custody. 25.28.090 – dependent tax deductions 25.28.300 – definitions

It was noted that the section ordering one or more grandparents to pay child support was removed. Also removed were sections regarding support order form and the commentary. Suggested that effective date be delayed for about a year. Federal law requires revisions to Child Support Guidelines every four years to ensure they meet current regulations. If SB 134 becomes law court system no longer responsible for that service.

Health Social Services February 15, 2012 Committee Meeting Sen. Kookesh stated ultimate goal of the bill is for an income share model. Health Social Services February 15, 2012 Committee Meeting CSSB 134 (version included in hand out including changes made during February 6, 2012 meeting) adopted moved to Senate Judiciary Standing Committee. Judiciary Committee hearing held March 7, 2012 (no minutes available) Next meeting scheduled for April 4, 2012 at 1:30 p.m.

General Information about Child Support Nationwide 26 States and the District of Columbia have established guidelines in statute The remaining 24 states establish guidelines by court rule or agency regulation 37 states take both parents income into consideration when calculating support award amounts Two models primarily used – Income Shares and Percentage of Income

Income Shares Model Based on concept that child should receive same proportion of parental income if parents lived together Calculates as the share of each parent’s income estimated to have been allocated to the child if original household was intact

Income Shares Process Four steps Income of parents determined and added together Basic support obligation computed on the combined income of parents Presumptive support obligation by adding expenditures for work-related child care expenses and extraordinary medical expenses Presumptive obligation pro-rated between each parent based on his or her proportionate share of total income

Income Shares Model Distinguishing Features Embodies underlying economic assumption that as income increase the proportion of income spend on child support decreases. Illustrate both parents sharing in the support of the child, increasing perception of fairness to both parents

Common Characteristics Most incorporate self-support reserve for obligor All guidelines have a provision relating to imputed income All take into consideration health care expenses via insurance or other means Most have incorporated special additions for child care expenses; special formulas for shared custody, split custody, extraordinary visitation and special deductions for the support of previous and subsequent children.

Fiscal Notes - Child Support Services Division Approximately 20,000 child support orders would be eligible for modification CSSD anticipates 10,000 modification requests will be submitted in first 6 months Modification section currently complete approx. 3,000 modifications per year with staff of 14. To meet increased demands will require 24 non- permanent staff. Five permanent staff due to additional work to determine awards under income shares model. Approx $6.7 million = $4 million from federal receipts and $2 million in general fund.

Fiscal Notes – Department of Law Federal Law Requires CSSD to complete modification requests within 180 days from receipt of request Currently the Collections & Support section processes 700 requests per year with 3.5 attorneys The anticipated increase in modification requests from 700 to 5,000 in one year will require non-permanent positions of 12.5 attorneys, 2 paralegals and 5 support position to meet initial demand Estimated $3.177 million

Fiscal Note – Alaska Court System Out of the 10,000 anticipated modification requests 5,000 are predicted to be handled by CSSD directly and 5,000 through court Estimates 3 hours of judge’s time to consider and resolve. Expected over a two-year period following effective date of the bill Court will hire 3.8 pro tem judges and 3.8 court clerk to assist judges for FY13 and FY14 Family Law Self-Help Center would require two additional full-time temporary facilitators Projected total $1.072 million

Example Calculations

Discussion Questions, Comments and Thoughts on Proposed Bill SB 134

Next Judiciary Committee Meeting April 4, 2012 at 1:30 p.m. If you would like to testify or provide written testimony please contact: Cindy Smith Dorothy Shockley Office of Senator Hollis French or Office of Senator Albert Kookesh cindy.smith@legis.state.ak.us dorothy_shockley@legis.state.ak.us (907) 465-3892 (907) 465-3018 Persons interested in testifying can all a toll-free number 1 (855) 463-5009 and ask to be connected to the Senate Judiciary Committee meeting.