Department of Children and Families
Child Support Guidelines Quadrennial Review
The Wisconsin Department of Children and Families proposes to repeal s. DCF 150.02 (10); to amend ch. DCF 150 (preface) and ss. DCF 150.02 (17), (19), and (21), 150.035 (1) (b)(Note), and 150.04 (1) (b) 3. a. and (4) (a); to repeal and recreate ss. DCF 150.02 (14), 150.03 (3), and 150.035 (1) (a); and to create ss. DCF 150.02 (15m), 150.03 (3m), and 150.035 (1) (ag), (ar), and (b) (title), relating to the child support guidelines quadrennial review. Analysis Prepared by the Department of Children and Families
Statutory authority: Section 49.22 (9), Stats. Statutes interpreted: Section 49.22 (9), Stats. Related statutes and rules: Section 767.511, Stats. Explanation of Agency Authority
Section 49.22 (9), Stats., states that the department shall promulgate rules that provide a standard for courts to use in determining a child support obligation based upon a percentage of the gross income and assets of either or both parents. The rules shall provide for consideration of the income of each parent and the amount of physical placement with each parent in determining a child support obligation in cases in which a child has substantial periods of physical placement with each parent. Summary of the Proposed Rules
Federal regulations require that states review their child support guidelines every 4 years to determine whether the use of the guidelines results in appropriate child support order amounts. What is considered appropriate changes over time as states continue to research and analyze case data, labor market data, and other economic factors.
As part of this federally-required review, the department established a Child Support Guidelines Review Advisory Committee to provide input and recommendations on the use of the child support guidelines in ch. DCF 150. The committee included representatives from the judiciary, the Wisconsin bar, county child support agencies, and organizations representing parents and children. The proposed rules are based on the committee’s recommendations. Federal Rule and Imputation of Income
Income imputed based on earning capacity. On December 20, 2016, a final federal rule, entitled Flexibility, Efficiency, and Modernization in Child Support Enforcement Program, was published that requires states to revise their child support guidelines on imputation of income. The federal rule provides that a child support order must be based on evidence of the parent’s ability to pay. If income imputation is authorized, the specific circumstances of the parent must be considered to the extent known, including various factors specified in the rule.
The proposed rules repeal and recreate the income imputation provision in s. DCF 150.03 (3) based on the 2016 federal rule. The proposed language is intended to provide objective factors that will be helpful in determining a parent’s earning capacity and that can be applied fairly to parties across the state. The proposed rules provide that if a parent is voluntarily unemployed or underemployed without good cause, the court may impute income to the parent based on the parent’s earning capacity. A parent’s incarceration may not be treated as voluntary unemployment for purposes of establishing or modifying a child support order. In determining a parent’s earning capacity, the court may consider the following factors:
— The parent’s recent work experience.
— The parent’s earnings during previous periods of employment.
— The parent’s job skills and training.
— The parent’s education.
— A vocational evaluation of the parent, if available.
— The parent’s diligence in seeking appropriate employment.
— Employment barriers the parent faces, such as homelessness, lack of a driver’s license, alcohol or other drug dependence, or immigration status.
— The parent’s criminal history and history of incarceration.
— If the parent is unemployed, whether the unemployment is due to the parent’s job-related misconduct.
— If the parent is the caretaker of a child common to the parties, the relationship between the parent’s earning capacity and the child care costs that would be incurred if the parent obtained paid employment.
— If the parent is the caretaker of a child common to the parties who has unusual emotional or physical needs, whether the child requires that parent’s presence in the home.
— The parent’s participation in reasonable career or occupational training to establish basic skills or enhance earning capacity.
— The parent’s age.
— The parent’s assets.
— The location of the parent’s residence.
— The parent’s receipt of Wisconsin Works cash assistance.
— The parent’s receipt of Supplemental Security Income.
— Any other factor that the court determines is relevant.
Under the current rules, the court may impute income to the parent at an amount that represents the parent’s ability to earn, based on the parent’s education, training and recent work experience, earnings during previous periods, current physical and mental health, history of child care responsibilities as the parent with primary physical placement, and the availability of work in or near the parent’s community.
Income imputed when no information is known. The proposed rules continue to allow imputation of income if evidence is presented that due diligence has been exercised to ascertain information on the parent’s actual income or ability to earn and that information is unknown. Under the current rules, the court may impute the income to the parent that a person would earn by working 35 hours per week for the higher of the federal or state minimum hourly wage. Under the proposed rules, the court may impute income to the parent that an individual would earn by working 10 to 35 hours per week for the higher of the federal or state minimum hourly wage.
Shared Placement and Equivalent Care
The proposed rules clarify when credit for equivalent care may be given when calculating a parent’s period of placement for purposes of determining the child support obligations of parents who have shared placement.
A parent’s period of placement is determined by calculating the number of overnights or equivalent care provided by the parent. Credit for equivalent care is given when a parent is caring for the child during a period that is not overnight, but is determined by the court to require the parent to assume basic support costs that are substantially equivalent to what the parent would spend to care for the child overnight.
Under the current rules, parents are sometimes receiving equivalent care credit for care during periods that were intended to be part of overnight care, resulting in duplicate credit for that care. The proposed rules provide that a parent may not receive credit for equivalent care during a period that is within 24 hours of a period for which the parent receives credit for overnight care of the child, unless the other parent is providing overnight care the night before and night after the period when the equivalent care is provided.
The proposed rules also move information currently in the definition of “equivalent care” in s. DCF 150.02 (10) to the shared-placement provision in s. DCF 150.035 and correct a typo in the shared placement example. Serial-Family Parent
Under the current rules, the court may determine a serial-family parent’s monthly income available for support of a child in a subsequent family by calculating the parent’s monthly income available for child support under s. DCF 150.03 (1) and subtracting the monthly amount of the existing support order for the child in the first family. The proposed rules provide that the court may subtract the higher of the monthly amount of the existing support order or the amount that would currently be determined under the child support guidelines. The proposed change is intended to reduce the need for multiple court actions to determine and modify the child support obligations of a serial-family parent.
General
The proposed rules also remove pronouns from the rule chapter.
Summary of Factual Data and Analytical Methodologies
The proposed rules are based on the recommendations in the 2021 Child Support Guidelines Review Advisory Committee Report to the department.
A statutory change is needed before the medical support provision in s. DCF 150.05 can be updated to conform to federal requirements. Under 45 CFR 302.56 (c) (2), a state’s child support guidelines must allow for provision of a child’s health care needs through private or public health care coverage or through cash medical support. Under s. 767.513 (1), Stats., and the current s. DCF 150.05, the definition of health insurance does not include medical assistance provided under ch. 49, Stats. Summary of Related Federal Law
45 CFR 302.56 (a) provides that, as a condition of approval of its state plan, each state must establish one set of child support guidelines for setting and modifying child support order amounts within the state. 45 CFR 302.56 (c) provides that a state’s child support guidelines must at a minimum do all of the following: (1) Provide that the child support order is based on the noncustodial parent’s earnings, income, and other evidence of ability to pay that:
(i) Takes into consideration all earnings and income of the noncustodial parent.
(ii) Takes into consideration the basic subsistence needs of the noncustodial parent who has a limited ability to pay by incorporating a low-income adjustment, such as a self-support reserve or some other method determined by the state.
(iii) If imputation of income is authorized, takes into consideration the specific circumstances of the noncustodial parent to the extent known, including such factors as the noncustodial parent’s assets, residence, employment and earnings history, job skills, educational attainment, literacy, age, health, criminal record and other employment barriers, and record of seeking work, as well as the local job market, the availability of employers willing to hire the noncustodial parent, prevailing earnings level in the local community, and other relevant background factors in the case.
(2) Address how the parents will provide for the child’s health care needs through private or public health care coverage or through cash medical support, or both.
(3) Provide that incarceration may not be treated as voluntary unemployment in establishing or modifying support orders.
(4) Be based on specific descriptive and numeric criteria and result in a computation of the child support obligation.
45 CFR 302.56 (e) provides that a state must review, and revise, if appropriate, its child support guidelines at least once every 4 years to ensure that their application results in the determination of appropriate child support order amounts. Comparison to Adjacent States
Iowa
Effective January 1, 2022, the Iowa Supreme Court ordered an amendment to the Iowa child support guidelines to conform to changes to 45 CFR 302.56 made in the 2016 federal rule. Under IA Rule 9.11 (4), the court may impute income in appropriate cases by determining a parent’s earning capacity based on factors that appear to be essentially the same as the federal factors in 45 CFR 302.56 (c) (1) (iii). Under IA Rule 9.5 (3) d., imputation of income is only allowed pursuant to agreement of the parties, or upon request of a party and a written determination made by the court that a parent is voluntarily unemployed or underemployed without just cause. Under IA Rule 9.14, there is no credit for care that is equivalent to overnight care when determining the obligations of parents who have shared placement.
IA Rule 9.5 (2) defines “net monthly income” as gross monthly income less various deductions, including a prior obligation of child support actually paid pursuant to court or administrative order for other children not in the pending matter.
Michigan
Effective January 1, 2021, the Michigan Friend of the Court Bureau updated the Michigan Child Support Formula Manual to conform to the 2016 federal rule. Under 2021 MCSF 2.01(G), if a parent is voluntarily unemployed or underemployed, or has an unexercised ability to earn, income includes the potential income that a parent could earn, subject to that parent’s actual ability. The court determines a parent’s potential income based on factors that include factors that are essentially the same as the federal factors in 45 CFR 302.56 (c) (1) (iii) and the following additional factors: the reasons for any termination or changes in the parent’s employment; physical and mental disabilities that may affect the parent’s ability to work; the parent’s availability for work, excluding periods the parent could not work or seek work due to hospitalization or debilitating illness; the parent’s means of support; the parent’s ability to drive and access to transportation; the presence of the parties’ children in the parent’s home and its impact on that parent’s earnings; any significant reduction in the parent’s income compared to the period that preceded the filing of the initial complaint or the motion for modification; and any additional costs associated with the parent earning the potential income, such as child care and taxes that the parent would pay on the imputed income. Under 2021 MCSF 3.03, there is no credit for care that is equivalent to overnight care. A parental time offset to the base support obligation is based on the approximate annual number of overnights that a child will likely spend with each parent.
Under 2021 MCSF 2.08B, net income for calculating support in a case does not include monies for children not in common with the other parent in the case.
Minnesota
Under Minn. Stat. sec. 518A.32, if a parent is voluntarily unemployed, underemployed, or employed on a less than full-time basis, or there is no direct evidence of any income, child support must be calculated based on a determination of potential income. It is rebuttably presumed that a parent can be gainfully employed 40 hours per week.
Determination of potential income must be made according to one of three methods, as appropriate: the parent’s probable earnings level based on employment potential, recent work history, and occupational qualifications in light of prevailing job opportunities and earnings levels in the community; the actual amount of the unemployment compensation or workers’ compensation the parent is receiving; or the amount of income a parent could earn working 30 hours per week at the higher of the federal or state minimum wage.
A parent is not considered to be voluntarily unemployed, underemployed, or employed on a less than full-time basis if the parent shows that the unemployment or underemployment will ultimately lead to an increase in income or that it represents a bona fide career change that outweighs the adverse effect of that parent’s diminished income on the child. The unemployment or underemployment is also not considered voluntary if the parent is physically or mentally incapacitated or incarcerated.
No income may be imputed to a parent who receives Temporary Assistance for Needy Families.
If a parent stays at home to care for a child who is subject to the child support order, the court may consider the parties’ parenting and child care arrangements before the child support action; the stay-at-home parent’s employment history, recency of employment, earnings, and the availability of jobs within the community for an individual with the parent’s qualifications; and the relationship between the employment-related expenses, including child care and transportation costs, and the income the stay-at-home parent could receive from available jobs within the community for an individual with the parent’s qualifications; the child’s age and health, including whether the child is physically or mentally disabled; and the availability of child care providers.
Under Minn. Stat. sec. 518A.36, the number of overnights or overnight equivalents that a parent spends with a child pursuant to a court order may be considered in determining the parent’s percentage of parenting time for the parenting expense adjustment. Overnight equivalents are significant time periods on separate days where the child is in the parent’s physical custody and under the direct care of the parent but does not stay overnight. The court may consider the age of the child in determining whether a child is with a parent for a significant period of time.
