FINAL BILL REPORT

 

 

                                    HB 2888

 

 

                                 PARTIAL VETO

 

                                  C 2 L 90 E1

 

 

BYRepresentatives Appelwick, R. Meyers, Dorn, McLean, May and Wood

 

 

Establishing a new child support schedule.

 

 

House Committe on Judiciary

 

 

Rereferred House Committee on Appropriations

 

 

Senate Committee on Law & Justice

 

 

                              SYNOPSIS AS ENACTED

 

BACKGROUND:

 

The Social Security Act Title IV-D requires the states to have a state plan for determining child support amounts.  In 1987, Washington state created a child support commission to recommend a child support schedule to the Legislature before the 1988 legislative session. The commission recommended a child support schedule to the Legislature that was adopted in the 1988 legislative session and that took effect July 1, 1988.  The Child Support Commission is scheduled to sunset on July 1, 1990.

 

The Schedule.  The schedule is based upon an "income shares" model which combines the net incomes of the parents and determines respective parental support obligations based on the parent's percentage of the combined income.  The support is calculated by reference to an economic table and to a set of standards.

 

Economic Table.  For combined incomes of up to $7,000 per month, the table sets presumptive amounts of child support.  The table varies with the number of children in a family and with the children's ages.  The superior courts of the counties may adopt an economic table that varies from the commission's table by up to 25 percent for combined monthly incomes of $2,500 or more.

 

Standards. The law provides 16 standards for determining child support.  These standards are:

 

1)  The Washington Child Support Schedule is to be applied: (a) in each county of the state; (b) in both judicial and administrative proceedings; (c) in all proceedings in which child support is determined or modified; (d) for setting temporary and permanent support; and (e) for adjusting support orders.

 

2)  The parents' obligation for support must be based on their combined net income, resources, and special child rearing costs.

 

3) Monthly gross income must include income from virtually any source.  However, although certain welfare payments must be disclosed, they are not to be included in gross income, and may not be a reason to deviate from the schedule.  Spousal maintenance or child support received from other relationships must be disclosed and considered under Standards 12 and 13, but may not be included in gross income.

 

4)  Allowable deductions from gross income are income taxes, FICA, mandatory pension plan payments, and mandatory union or professional dues.  Payment of child support or maintenance involving other relationships must be disclosed and considered under Standards 12 and 13, but must not be included as a deduction from gross income.

 

For self-employed persons, normal business expenses and self-employment taxes may be deducted. Justification is required for any business expense deduction about which there is disagreement.

 

Non-recurring overtime or bonus income may be separately identified and allowed as a discretionary deduction from gross income.

 

5)  Tax returns for the preceding three years and current pay stubs must be provided to verify income and deductions.  Other sufficient verification is required for income and deductions that do not appear on tax returns or pay stubs.

 

In the absence of income information to the contrary, a parent's income is to be based on the median income of year-round full-time workers as derived from the United States Bureau of Census, Current Population Reports.

 

6)  The basic child support obligation derived from the table must be allocated between the parents based on each parent's share of the total family net income.

 

7) Ordinary health care expenses are built into the economic table.  Expenses exceeding the amount set forth in the instructions must be considered extraordinary and must be shared by the parents in the same proportion as the basic child support obligation. The table presumes that 5 percent of the basic support obligation is spent on ordinary medical care.

 

Day care and special child rearing expenses such as tuition and long-distance transportation costs are not included in the economic table. These expenses must be shared by the parents in the same proportion as the basic child support obligation and must be listed as a specific dollar amount.

 

The court may determine the reasonableness and necessity of extraordinary and special expenses.

 

8)  When combined monthly net income is less than $600, a support order not less than $25 per month per child must be entered.

 

When combined monthly net income exceeds $7,000, child support must be determined by that amount from the table, together with an additional amount to be determined on an individual basis.

 

9)  Neither parent's child support obligation may exceed 50 percent of net earnings unless good cause is shown.  Good cause may include possession of substantial wealth, children with day care expenses, special medical, educational, or psychological needs, and larger families.

 

10)  Basic child support must be allocated between the parents when a child stays overnight with the parent over 25 percent of the year.  When this adjustment is sought, and the parents are not in agreement, the parent seeking the adjustment must provide evidence to demonstrate the parent's actual past involvement with the child. However, the support payment may not be reduced if there will be insufficient funds available to meet the basic needs of the child in the house receiving the support, or if the child is receiving AFDC payments.

 

11)  The presumptive amount of support must be determined according to the schedule.  Deviations must be explained in writing and supported by evidence.  When reasons exist for deviation, discretion must be exercised in considering the extent to which the factors would affect the support obligation.

 

12)  Reasons for deviation may include the possession of wealth, shared living arrangement, extraordinary debt, extraordinarily high income of a child, a significant disparity in the living costs of the parents due to conditions beyond their control, special needs of disabled children, and tax planning.

 

13)  When there are children from other relationships, the schedule must be applied to the mother, father, and children of the relationship being considered. Deviations from the amount of support derived from this application may be based upon all the circumstances of both households.  All income, resources, and support obligations paid and received must be disclosed and considered.  Support obligations include amounts owed for children in and outside of the home.

 

14)  The schedule is advisory and not presumptive for children who have attained the age of 18 and have completed their secondary education.  (The law governing child support for children over 18 who want to attend college has developed in case law since 1926.  The schedule did not supplant that case law. The courts have awarded child support for children over 18 who want to go to college, after considering a number of factors including the child's age, abilities, disabilities, expectations of the parties, the parents' resources, education level, and what opportunities the child would have had if the parents had stayed together.)

 

15)  Wage income must be imputed for parents who are voluntarily unemployed or voluntarily underemployed.  A parent will not be deemed underemployed as long as that parent is gainfully employed on a full-time basis.  Income may not be imputed for an unemployable parent.

 

16)  There must be full disclosure of each parent's household financial information. The worksheets must be completed under penalty of perjury and filed with the court.

 

Other Background.  The parents must complete worksheets to calculate income and credits due and then use the table to determine the dollar amount of support.

 

No statutory mechanism exists for verification and reimbursement of day care, long distance transportation costs, or other extraordinary expenses.

 

Not more than once a year, a support order may be modified without a substantial change of circumstances.  Such a modification is possible if the order in practice works a severe hardship on a party or a child, if the support was based on the child's age and the child is no longer in that age category, if the child is still in high school and a need exists to extend the support beyond the child's 18th birthday, or if the modification is to add an automatic adjustment of support pursuant to a court order.  The court may require periodic adjustments of support.  A motion for modification is commenced by filing a petition and financial affidavits.  If the support obligation has been assigned to the state, the Office of Support Enforcement must be served.

 

The schedule for industrial insurance total disability benefits paid to injured workers includes a 2 percent increase for each child of the injured worker, up to five children.  If the child is not in the custody of the injured worker, the percent of the benefits payable for the child is paid to the person having custody of the child under a child support order.  There is no provision allowing the injured worker credit against his or her child support obligations for the amount of industrial insurance benefits paid to the child's custodian.  The social security administration also may pay social security disability benefits on behalf of an injured person's children.

 

The Department of Social and Health Services may file an action to modify a child support order if the child is receiving public assistance and the child support order is 25 percent or more below the appropriate amount in the schedule.

 

Under present law, a step parent who is obligated to support a step child remains obligated until termination of the marriage or upon death.

 

The parenting act's provisions governing dissolutions and modifications of decrees involving custody, visitation, child support or parenting plans, apply only to actions filed after December 31, 1987.

 

At present, no systematic collection of data occurs regarding the implementation and effect of the child support schedule.  Also, actions filed for divorce, custody, or child support are not on standardized forms.

 

SUMMARY:

 

Definitions.  Definitions are amended or added:  "basic child support obligation" means the monthly obligation determined from the economic table based on the parties' combined monthly income, "standard calculation" means the amount of child support due before any deviation is considered, and "transfer payment" means the court ordered amount one parent is obligated to pay the other parent for child support.

 

The Table.  The economic table adopted by the Child Support Commission remains in effect.  The economic table will continue to be published in the Washington State Register.

 

Cap At The Upper End Of The Table.  The cap on the table is lowered from $7,000 to $5,000 combined monthly net income.  The court still may not set support at an amount lower than the presumptive amount for combined monthly incomes of $5,000, but may in its discretion set support at higher levels.

 

Cap At Lower End Of Table.  The child support ordered may not reduce the monthly net income of the parent making the transfer payment to an amount lower than the federal needs standard except for a mandatory minimum payment of $25 in support, or if the court finds that reasons for deviation exist that warrant the reduction.

 

Gross Income Sources.  Sources of gross income are the same as the current standards with the following changes:  overtime is limited to mandatory overtime, pension retirement benefits are added, social security benefits are limited to social security retirement benefits, spousal maintenance actually received is added, and Veterans' Aid and attendance allowance is excluded.  In addition to the other sources of income, monthly gross income for the preceding year includes voluntary overtime pay above 168 hours per month of regular time, income from employment in excess of a total of 40 hours per week to the extent the excess is derived from all jobs, nonrecurring bonuses, contract related cash benefits, gifts, and prizes, except to the extent that income from those sources exceeds the average income from those sources for the second and third years preceding the commencement of the action.

 

Deductions From Gross Income.  Amounts that may be deducted from gross income are the same as the current standards with the following additional deductions:  1) Court ordered spousal maintenance to the extent actually paid, 2)  child support payments for children of other relationships, and 3) up to $2,000 per year in voluntary pension plans if the contributions were made for three consecutive years prior to the commencement of the dissolution.  The court can order or the parties can agree which parent may take the federal income tax deduction for dependents.

 

Income of a new spouse or other adults in the household, child support received from other relationships, and income excluded from voluntary overtime, other jobs, gifts and prizes, bonuses, and contract related cash benefits that are not included in gross income, may be a reason to deviate from the standard calculation.

 

Day Care, Long Distance Transportation, Extraordinary Expenses.  An express statement is added that day care, long distance transportation, and other extraordinary expenses that are not included in the table are to be shared in the same proportion as the basic support obligation.

 

Deviations.  Once the standard calculation and each parent's proportionate share of that obligation is determined, the court may then consider whether appropriate reasons exist to deviate from the standard calculation for one or both parents.  These reasons for deviation are applicable whether or not there are children from other relationships.  Reasons for deviation include the following: possession of wealth, shared living arrangements, extraordinary debt that has not been voluntarily incurred, extraordinarily high income of a child, a significant disparity in the living costs of the parents due to conditions beyond their control, and special needs of disabled children.

 

Deviations When There Are Children From Other Relationships.  If the court has allowed a deduction from gross income for court ordered child support for children of other relationships not before the court, those children for whom the deduction was allowed cannot be a reason to deviate from the child support ordered for the children of the parties before the court.  If a parent has children from other relationships for which no court order for support exists, such as children born into a subsequent marriage, the court may consider the support of those children as a reason to deviate from the child support amount for the children of the parties before the court.  Deviations must be based on all the circumstances of both households.

 

Residential Credits.  Current law that provides for residential credits to reduce the transfer payment after the child spends over 90 overnights with the parent obligated to make the transfer payment, is stricken.  The court may deviate from the standard calculation if the child spends a substantial amount of time with that parent.

 

Postsecondary Education. The court may order postsecondary education support as provided under the current law with the following changes:  The child must be actively enrolled in school and pursuing a course of study and in good academic standing as defined by the institution, or the support may be suspended during the time of noncompliance.  The court may not order support beyond the age of 22 except for exceptional circumstances such as physical, mental, or emotional disabilities.  The court may in its discretion order that the payments be made to the parent who received support when the child was under 18, to the educational institution, or to the child.

 

Reimbursement For Day Care, Transportation, Extraordinary Health Care and Extraordinary Costs.  Parents making payments for day care, extraordinary health care expenses, transportation costs, and other extraordinary expenses, are entitled to reimbursement for the other parent's proportionate share of the expense.  The parent responsible to reimburse the other parent is entitled to receipts to verify the expenditures. Reimbursement for transportation costs, extraordinary health care costs, and other extraordinary expenses must be paid no later than 30 days after receipt of expenditure verifications.  A parent to whom the reimbursement is owed may reduce the amounts to a sum certain and obtain a wage assignment order to collect the amounts due.

 

Modifications.  All child support orders may be adjusted once every 24 months based upon changes in the income of the parents without showing a substantial change of circumstances.  A party may move for modification any time based upon a substantial change of circumstances but if relief is granted, must then wait another 24 months to modify the decree again based upon a change in parental income.  If a parent who is receiving a transfer payment receives a raise in income, that increase alone cannot form the basis for an increase in the other parent's obligation unless a modification is allowed upon a substantial change of circumstances.  Parents who want to take advantage of the new schedule whose decrees are entered before July 1, 1990, may move for a modification after 12 months have expired from the entry of the decree or the latest modification.  However, after the first modification under the act, the next modification without a substantial change in circumstances may not be sooner than 24 months.  If the court modifies a court order by more than 30 percent and the change will cause significant hardship, the court may implement the change in two equal increments, one at the time of entry of the court order and one six months later.  The court may modify automatic periodic adjustments of support due to economic hardships.  A parent moving to modify an order must file worksheets in addition to a financial affidavit.

 

DSHS Modifications.  The Department of Social and Health Services may not move to modify a child support order that is 25 percent lower than the amount due before any deviations are considered if the reasons for the deviations are included in the order.  If the support obligation has been assigned to the state the worksheets must be served on the attorney general instead of the Office of Support Enforcement.

 

Worksheets. The administrator for the courts is to develop new worksheets and instructions.  The administer for the courts must also explore methods to assist pro se litigants and judges to calculate support payments through automated software, equipment, and personal assistance.  The courts may not accept incomplete worksheets.  The judge must sign a completed worksheet and include one in the court order.

 

Stepparent Support.  A court may upon motion of a stepparent, terminate the stepparent's obligation to support stepchildren when the petition for dissolution or legal separation is filed.

 

Parenting Act Application.  The parenting act is amended to apply to all modifications, not just modifications filed after December 31, 1987.

 

Payments On Behalf Of An Injured Worker.  The amount paid from an injured worker's industrial insurance total disability benefits or social security disability dependency benefits for children of the injured worker must be treated as if it were paid by the worker toward satisfaction of his or her child support obligation.

 

Collection Of Data.  When the decree or modification is entered, the parties must complete a form developed by the administrator for the courts providing information about the child support calculation and award.  The form must be filed with the court clerks and forwarded to the administrator for the courts.

 

Standardized Forms Practice.  The administrator for the courts must develop forms not later than July 1, 1991, for mandatory use by litigants in all actions for divorce, child custody, and child support.  Parties must use the standardized forms beginning January 1, 1992.

 

Miscellaneous And Technical Changes.  References to "medical records" is changed to "health care records" to clarify what types of records are available to parents and that parents owe support for all health care, not just "medical" care.  Language for imputing income to a parent by referencing the United States census reports on median income is deleted; income will be imputed based on the parent's work history.

 

 

VOTES ON FINAL PASSAGE:

 

      House 78  19

      Senate    35    14 (Senate amended)

      House             (House refused to concur)

     

      Free Conference Committee

      Senate    35    11

     

      First Special Session

      House 71  25

      Senate    33    13

 

EFFECTIVE:June 7, 1990

            March 26, 1990 (Sections 5 and 22)

 

PARTIAL VETO SUMMARY:  The veto restores the current law's standards and economic table with a cap of $7,000 combined monthly net income.  The day care, long distance transportation, and other extraordinary expenses verification and reimbursement scheme is stricken.  The cap at the lower limit of the schedule which is the federal needs standard and the $5,000 cap at the upper end of the schedule are also stricken.  The provisions that change the definitions of income, exclusions, deductions, and residential credits are stricken, restoring the commission's standards governing those calculations.  (See VETO MESSAGE)