Abell Foundation: Three Sensible Child Support Reforms

July 23, 2019 by Robert Franklin, Esq.

The Abell Foundation’s report on the child support system in Maryland doesn’t simply criticize, it offers solutions as well (Abell Foundation, June, 2019). My first piece on the report appears here.

The report, written by former commissioner of the Office of Child Support Enforcement, Vicky Turetsky, pulls no punches. It points out that support orders are routinely set too high for non-custodial parents to pay resulting in skyrocketing debt, most of which is uncollectable. All of that hits the poor disproportionately hard and results in the marginalization of non-custodial parents (most often dads) in their children’s lives.

So the report urges three fixes for the current system: (1) base orders on non-custodial parents’ actual incomes, (2) reduce uncollectable child support debt and (3) ensure that children, not the state, get the money intended for them.

Turetsky comes down hardest on imputed income:

A major culprit behind unaffordable orders is using attributed, or imputed, income as the basis for calculating support obligations in low-income cases. Imputed income is fictitious income.

Child support orders based on fictitious income are almost certain to go unpaid in large part. How could it be otherwise? A parent may have once had a good job, but if he/she is out of work, that income no longer rolls in, irrespective of what a judge may decide. In Maryland, a full one-fourth of all child support orders were based on imputed income. Plus,

Parents having orders based on imputed income actually earned 72 percent less than the amount listed on the child support worksheets.

Unsurprisingly, parents with imputed income paid far less of what they owed than did parents whose orders were based on actual earnings.

Fortunately, the OCSE amended its regulations in 2016 to discourage the use of imputed income. The new standard

requires support orders for low-income parents to be based on “earnings, income, and other evidence of ability to pay,” established through fact-finding about the parents’ specific circumstances.

As to uncollectable arrears, the Abell report urges states to first write off uncollectable debt. The Administration for Children and Families has, in the past, calculated that some 40% of current arrears will never be collected. In that case, states should admit the obvious and write of those debts as uncollectable. But doing so isn’t just an accounting function.

There is ample evidence that many low-earning parents facing substantial child support debt become discouraged and leave formal employment. This usually is because they cannot afford to live on the earnings that remain once child support has been deducted from their paychecks. High arrears can substantially reduce child support payments, earnings, and labor force participation by noncustodial parents.

Worse,

Indebted noncustodial fathers have significantly less contact with their children, are less engaged in their daily activities, and provide less frequent informal support.22 Indebtedness is associated with greater parental depression, alcohol overuse, poor health, worsened family relationships, less effective parenting, and deteriorating child behavior.

In short, high levels of child support debt are bad for everyone, the child, the non-custodial parent and the economy. That’s a powerful argument for reform.

Last, the Abell report argues for what many others have before: that children, not the state, receive child support money. As it is, when a custodial parent receives Temporary Assistance to Needy Families, any child support that comes later goes to repay the state until that debt is paid in full. Only then do child support payments go to the custodial parent.

It’s a system that’s well-known to discourage payment. Non-custodial parents are often hard enough pressed to pay at all, but when they realize that whatever they pay goes, not to the child, but to the state, many simply keep the money.

When Vickey Turetsky talks, people should listen. Turetsky knows the path to more sensible child support practices that would help kids and parents alike, plus cutting state bureaucracies. Can sensible child support reform be far away?