CSR, Incorporated, and its subcontractor, the American Bar Association's Center on Children and the Law (ABA), conducted this evaluation of the implementation of child support guidelines under a contract with the Office of Child Support Enforcement. This evaluation began in October 1994 and concentrated most of its resources on the collection and analysis of child support case records from 21 counties in 11 States. Other major components of the evaluation were the collection and analysis of State guideline reviews, interviews with key individuals in the States with case record data, data from the Current Population Survey, and meetings with an expert panel of judges, attorneys, and professionals in academia. This chapter summarizes the major findings, conclusions, and recommendations generated by the evaluation. Section 4.1 presents a summary of guideline implementation, deviations, and discrepancies based on the guidelines of 11 States and case records from 21 counties. Section 4.2 summarizes the results for seven key factors in child support guidelines151multiple families; income definition, verification, and imputation; health care expenses; child care; support for postsecondary education; tax considerations; and extended custody and visitation arrangements. Section 4.3 presents findings from the analysis of guideline reviews, and Section 4.4 summarizes the overall findings.

4.1GUIDELINE IMPLEMENTATION, DEVIATIONS, AND DISCREPANCIES IN CASE RECORDS

Chapter 2 of the report presented a detailed analysis of guideline implementation, deviations, and discrepancies in case records. The following is a summary of findings, conclusions, and recommendations from Chapter 2.

Overall, the pooled individual case record data indicate that 83 percent of cases were considered to be guideline cases, while 17 percent of cases were categorized as deviations in the case records. These statistics suggest that State guidelines have been followed when orders are established and that discretion is exercised with restraint. However, the percentage of guideline and deviation cases varied considerably across the counties.

The analysis of deviation cases indicates that the four most common reasons for deviations were (1) an agreement between the parties, (2) second households or multiple families, (3) extended or extraordinary visitation or custody expenses, and (4) low obligor income. Overall, 15 percent of the deviations were upward (the average award increase was 30 percent), while 74 percent were downward deviations (the average award decrease was 36 percent).

In addition to deviations identified as such in the case records, the analysis found discrepancies between the award amount calculated using the guideline methodology (including any documented deviation) and the final award in the court order. These discrepancies were not documented as deviations in case records. Two counties had discrepancies in fewer than 10 percent of their cases, six counties had discrepancies in 10 percent and 20 percent of their cases, five had discrepancies in 20 percent to 30 percent of their cases, and four had discrepancies in more than 30 percent of their cases. No discernible difference in discrepancy rates was found in cases following the guideline methodology as compared to deviation cases. Also, no systematic cross-county pattern existed with regard to whether orders exceeded or fell short of the calculated guideline amount.

Overall, the analysis of case records indicates that consistency of guideline application varied considerably within and across States. For most cases, guidelines were implemented in a way that the order was consistent with the computed guideline figure, as expected. However, in some counties, consistency of guideline application was less frequent than expected. As noted previously, various random and systematic factors accounted for discrepancies and no one reason can be systematically linked to discrepancies across or even within counties.

Based on these findings, we recommended that several strategies be adopted by States in order to increase consistency of guideline application. These strategies include identifying the causes of random inconsistency and improving training and technical assistance. In addition, coordination and consistency of policy within and between agencies and courts is needed with regard to procedures and documentation.

4.2FACTORS IN CHILD SUPPORT GUIDELINES

Chapter 3, Factors in Child Support Guidelines, presents a detailed analysis of State guideline reviews, interview findings, and case record data for each of seven factors that pose major challenges in the development and implementation of guidelines. The following sections summarize the findings, conclusions, and recommendations for each factor.

4.2.1Multiple Families

Decisionmakers are increasingly faced with the task of computing a child support order that balances the child(ren)'s needs with the available parental resources. This task is difficult at best, and the factor of multiple families is a major concern in designing equitable child support guidelines.

Guideline review teams and individuals directly involved with the child support system agreed that measures are needed to ensure that these situations are treated equitably and consistently. The analysis of child support cases from the 21 study counties suggests that a mandatory numerical adjustment results in a greater number of multiple family situations being recognized by the decisionmaker and,more importantly, being considered in a consistent manner when determining support. This approach contrasts those of States that only use a discretionary provision for multiple family situations. In these States, not only were the multiple family situations recognized less frequently, but when they were considered, they were not consistently handled across cases.

Based on these findings, States should consider adopting a provision that requires decisionmakers to consider prior support orders and subsequent obligations of both parents when calculating child support.

4.2.2Income Definition, Verification, and Imputation

An important step in calculating an accurate child support order is determining the available parental resources. The analysis of child support cases indicated that income verification is not frequent across the counties. States should strive to enforce verification of parental income in every child support award, and States should provide decisionmakers with specific instructions to verify income. Furthermore, respondents reported that parties often were not prepared with the proper income verification forms at hearings. Providing decisionmakers with the ability to verify income through independent sources, such as employment security records, would help remedy this problem.

Consistent income verification procedures would (1) ensure that child(ren) are treated equitably, (2) allow decisionmakers to better understand a family's economic history when modifying support orders, and (3) permit guideline reviewers to better evaluate the definition of income and identify problems in obtaining accurate information.

When all available income verification sources yield little or no information on a parent's income, or if the parent is voluntarily unemployed or working below his or her potential, the decisionmaker in many States must impute an income for that parent. Many States provide general guidelines on how to impute income, and a discretionary approach seems to be the most appropriate for imputing income, as the circumstances from case to case will vary. However, guidelines should provide specific instructions on how and under what circumstances to impute income. This would result in more consistent treatment of families.

4.2.3Health Care Expenses

The case record analysis showed that decisionmakers complied with Federal Regulations for cases by ordering the provision of health insurance. However, when health insurance was ordered for one or both of the parents, the cost was rarely included in the child support calculation in States that have a mandatory numerical adjustment for such costs. While this exclusion may be due to unavailable health insurance costs or no-cost coverage for the providing parent, States should strive to enforce more consistent use of their respective adjustments.

Parents and decisionmakers alike expressed concern about extraordinary health care expenses and the tendency for these to result in excessive support orders. Because costs of this nature occur randomly, States should ensure that they are addressed at the outset to provide for the child(ren)'s needs. To that end, States should continue to research (1) the involved costs and (2) the methods to handle the costs in a fair and consistent manner. This basically is discretionary, however, in view of the unusual nature of the problem.

4.2.4Child Care

A significant number of custodial parents work, and many work full time. Therefore, a substantial majority of these working parents may incur day care expenses. Many States have developed mandatory numerical adjustments to handle these costs when calculating a child support order. Child care expenses were mentioned in 19.9 percent of the case records, with a range from 0.5 percent to 44.7 percent across the counties. The case record analysis showed that day care expenses were included in the child support calculations for the cases that mentioned child care expenses.

To ensure that the custodial parents' child care needs are addressed, States should work to consistently implement any adjustment to the guideline amount or require decisionmakers to address these expenses in child support orders, whenever appropriate.

4.2.5Support for Postsecondary Education

Custodial parents who were interviewed expressed concern over the termination of support upon their child's 18th birthday. Financial resources are especially needed at this time to ensure that the child can attend college. Guideline review teams varied in their discussions and conclusions regarding the provision of postsecondary education support, with no clear consensus.

The analysis of case records showed that the consideration of postsecondary education in support orders occurred most frequently in stipulated agreements and non-IV-D cases. Most of these cases provided for the future needs of the child(ren), rather than addressing immediate expenses. States at their discretion may decide to allow consideration of postsecondary education costs. It would be difficult to mandate this because coverage cannot be required for intact families.

4.2.6Tax Considerations

Standards specified in guidelines that discuss tax exemptions seem adequate to allow the decisionmaker to make an equitable arrangement. This is reflected in the analysis of case records, which showed that tax exemptions are commonly allocated in a flexible manner in order to adjust with changing circumstances.

Although tax considerations are likely to affect only middle- to upper-range income parents, States should strive to allocate tax exemptions in every child support order and provide guidance on how to best meet the needs of the parents and children. This is particularly true in cases for which maximizing the after-tax income of each parent would benefit the child(ren).

4.2.7Extended Custody and Visitation Arrangements

Extended custody arrangements151including split custody, joint custody, and shared custody151are becoming more common, and this was one of the most common issues discussed by State guideline review teams. The teams' investigations showed that States handled the arrangements with a considerable degree of inconsistency and inequity, and the teams recognized that formal methods were needed to remedy this problem. This view was repeated by parents who reported that extended custody arrangements are a common reason to request deviation. Furthermore, in their case studies of deviations, States found that extended custody arrangements were commonly used reasons for deviation.

Although the definition of split custody is a straightforward one, States vary considerably in their definitions of extended visitation (i.e., when "normal" visitation becomes "extended") and of what constitutes joint or shared custody. The States also vary in their guideline methodologies for calculating how extended visitation or split custody should affect the order amount. A few methods have been proposed and adopted to handle split custody arrangements, such as computing and offsetting two awards. Several methods have been proposed for handling joint/shared custody, ranging from sliding percentage scales that adjust for the number of days the child(ren) spend with the noncustodial parent, to support abatements for the period(s) of extended visitation.

Split custody arrangements apparently are the easiest situations to address in a mathematical fashion, and States should consider addressing these arrangements using this method. Study States that have such a provision used it most of the time, resulting in consistent treatment of families. States should attempt to develop clear definitions of joint/shared custody and extended visitation, although these arrangements do not lend themselves to mathematical solutions as easily as split custody. Because the circumstances will vary greatly from family to family, the decisionmaker must carefully consider the right approach to an equitable support order. Further guidance on determining the nature of the custody arrangement and on factors to consider would result in greater consistency and equity across cases.

4.3ANALYSIS OF GUIDELINE REVIEWS

The Family Support Act of 1988 requires States to review their guidelines every 4 years. The purpose of these guideline reviews is to evaluate whether State guidelines provide child support in an adequate and consistent manner. Reviewers are required to consider case data regarding the application of guidelines and to consider economic data related to the cost of raising children. One component ofthis research was a study of the extent and quality of guideline reviews, the review findings, and resulting actions. This analysis, conducted by the ABA, was based on the guideline reviews of 45 States.

Guideline reviews often discussed the child support issues addressed by this study, including income-related matters, child-custody and multiple family arrangements, and other factors that contribute to the cost of raising children.

Many review teams considered how to determine the income on which to base support. They discussed whether to use net income or gross income, often deciding to use an adjusted gross income that was similar to net income. They considered whether to include income from sources other than full-time employment. Reviewers generally agreed not to include Aid to Families with Dependent Children benefits, but included earnings from second jobs and bonuses. Recommendations regarding the inclusion of overtime earnings, bonuses, and other assistance monies differed among reviewers.

While verification of income was discussed by only one State, imputation of income was considered often among the study States. Reviewers agreed that income should be imputed for a voluntarily underemployed or unemployed parent and that "underemployment" refers to situations in which a parent's job is not consistent with his or her level of education, skills, or experience. Reviewers further determined conditions under which income should be attributed, the level at which imputation income should be set, and exceptions that would permit a parent to avoid income imputation.

Reviewers considered several custody and multiple family issues. Recommendations for situations involving joint custody or multiple families included both guideline formulae and deviations at the discretion of the decisionmaker. In addressing split custody, reviewers considered several procedures and technical aspects for calculating support. They discussed definitions of "normal" visitation and "extended" visitation and the abatement of the obligor's support amount during such periods. Some reviewers distinguished State custody cases according to whether some or all the children were in State custody, and others decided to treat all foster care cases as multiple family cases.

Finally, State review teams considered several factors which impact the cost of raising children. Among these were child care costs, health insurance premiums, uninsured health care costs, and postsecondary education. In some cases these factors were handled as above-the-line adjustments to the parents' income; in others they were treated as below-the-line award adjustments.

An important finding from this analysis of guideline reviews is that only about 20 States collected and analyzed case data. Fewer than one-half of the States considered economic data on the cost of raising children. Furthermore, the extent to which these States took action as a result of these data is unclear.

4.4SUMMARY

Child support guidelines have been developed and implemented by all States under guidance provided by the Family Support Act of 1988 and Federal regulation (45 CFR 302.56). This evaluation of child support guidelines focused on the implementation of presumptive guidelines and issues arising from that implementation. In doing so, the evaluation examined how guidelines operate, but did not address the adequacy of awards to provide for the child(ren)'s needs, the equity of awards for custodial parents and noncustodial parents or the enforcement of awards. Even within this narrow scope, the range and complexity of the issues arising in setting child support awards make it necessary to consider each issue alone and with other issues, and not to generalize guidelines' effectiveness as a whole.

In the analysis of guideline implementation, the evaluation revealed that most awards conform to Federal law and regulations151the cases were based solely on the numerical calculations mandated in State guidelines or deviated from the presumptive guideline amount with appropriate justification. However, documentation of the reasons for deviations was missing or unclear in a significant number of cases. In addition, many cases included discrepancies between the award amount calculated from the available data and the amount awarded in the order. Although evaluators recognized the enormous demands of time and energy on decisionmakers throughout the child support system, it is highly recommended that the States improve their case documentation so that State guideline review commissions and future evaluations can perform more definitive analyses.

In any child support case under any guideline, the decisionmaker must always decide a wide range of facts, such as the right amount of day care expenses based on the applicable law and the facts of the case. After these facts have been established, the guidelines may mandate numerical adjustments for a specific factor, such as child care, or may leave the adjustment to the discretion of the decisionmaker. The evaluation examined seven key factors in child support guidelines151multiple families; income definition, verification, and imputation; health care expenses; child care; support for postsecondary education; tax considerations; and extended custody and visitation arrangements.

The examination of these seven factors was intended in part to analyze the differences among guidelines that mandated numerical adjustments or calculations for each factor and those that allowed decisionmakers to use their discretion in making adjustments. The evaluation found, in general, that where guidelines included mandatory numerical adjustments, the adjustments were mostly made where applicable. However, discretionary adjustments were made in relatively fewer cases. Data from cases in the States with mandatory numerical adjustments suggest that child(ren) in similar circumstances would be treated equitably if mandatory adjustments were included in all State guidelines.

Finally, States are required to review their guidelines every 4 years to evaluate their adequacy and consistency. Reviewers analyze case data related to the application of and deviations from the guidelines and consider economic data related to thecost of raising children. This evaluation examined State review efforts with regard to review procedures, review issues, and reviewers' recommendations. The findings were that only approximately one-half of the States appeared to have followed Federal requirements to analyze case data and to consider economic data regarding the cost of raising children.

In future guidelines reviews States should consider the following:

149Use sufficient resources, time, and staff;

149Perform case surveys and use the results to limit deviations and improve consistency; and

149Review the economic data on the cost of raising children and update the tables used to calculate child support awards.