Here is the letter:

Greetings,

As you know, the Attorney General has initiated a special project to respond to current economic crisis. The goal of this project is to speed the entry of fair and enforceable orders. We are also hoping to use the project as an opportunity to try out some other changes in the guidelines and procedures.

There are two important changes that will become effective May 7, 2009. First, at the request of the Division of Child Support, the legislature has enacted and the Governor signed emergency legislation and rules authorizing the temporary modification of existing orders based upon employment related loss of income to either parent. HB 2275A. These temporary modifications are only available through the child support program, either through the Division of Child Support (DCS) or through District Attorneys offices. Private attorneys and the court cannot independently issue temporary modifications. DCS has established a specialized unit in Salem called the “Recession Response Team” (RRT) to handle these modifications, using streamlined procedures designed to encourage consent and expedite modifications. Parents can access this team through the DCS interactive telephone system, by dialing 1-800-850-0228 and listening to the instructions.

The second change is to the child support guidelines themselves. The most significant changes include a cap on child care costs, adjustments relating to medical support orders and the establishment of a presumption $100 minimum order.

More details regarding the changes follow. The proposed rules are currently posted on the DOJ/DCS website in draft form. http://www.dcs.state.or.us/oregon_admin_rules/child_support_rules/draft.htm. In addition, a training module will be available through the DOJ-DCS website.

Statutory Change:

HB 2275A was signed by the Governor on May 5 and makes a number of changes to ORS 416.400 through ORS 416.465. It authorizes the Attorney General to declare that we are in a period of significant unemployment (an unfortunately easy decision to make in this economy), during which time existing orders can be suspended and replaced with a temporary modification based upon actual income. These temporary modifications automatically expire six months from the date of entry in court, but may be renewed. HB 2275A also authorizes alternate forms of service designed to speed the modification process.

Regular Division Rule Changes:

OAR 137-055-2140 (Delegations to Administrative Law Judge): this change allows an administrative law judge (ALJ) to enter a final order by default on employment-related modifications. It also allows the ALJ to dismiss the temporary modification request if the requesting party fails to appear for the hearing.

OAR 137-055-2165 (Request to Reschedule): this change requires requests to reschedule a hearing to be filed within 60 days of the notice of hearing cancellation.

OAR 137-055-3420 (Periodic Review): this change clarifies that a temporary modification does not affect the time period for a periodic review and adjustment of the order that is suspended.

OAR 137-055-3430 (Change of Circumstance Review): this change amends the change of circumstance rule to:

• Provide a definition of an “temporary modification” pursuant to HB 2275
• Define “employment-related change of income”
• Allow for a verbal request for temporary modifications
• Allow for alternative service methods on temporary modifications

The online calculator will be modified and ready with the changes outlined above on May 1, 2009.

Guideline Rule Changes:

OAR 137-050-0320 (Definitions): this change provides that when a parent must self-enroll in medical coverage in order to enroll his/her child(ren), the providing party’s portion of the health care coverage premium may be deducted from modified gross income. The coverage must still be found to be appropriate before it can be ordered. The child’s portion of the cost is still handled as set out in OAR 137-050-0410.

OAR 137-050-0330 (Computation): this change clarifies that when the self-support reserve lowers the child support obligation, the reduction is applied first to the cash medical support amount and then to the cash child support amount.

OAR 137-050-0340 (Gross Income): this change moves the requirement that gross income must be attributed to the parent who is a recipient of TANF to the “Income Presumptions” rule.

OAR 137-050-0360 (Potential Income): this change renames the rule to “Income Presumptions” and provides that a rebuttable presumption of actual income is to be used for temporary modifications and potential income for all other modifications.

OAR 137-050-0420 (Child Care Costs): this change caps child care costs based on the age of the child and where the care is provided. The figures used for the cap are captured from the Department of Human Services administrative rules, averaged across the board.

OAR 137-050-0430 (Cash Medical Support): this change creates the priority of cash child support over cash medical support when the self-support reserve lowers the obligation amount. It also prohibits entry of an order for cash medical support if the obligor’s income is less than Oregon minimum wage.

OAR 137-050-0475 (Ability to Pay): this change provides that where the self support reserve is presumed to be the correct obligation amount, any reduction in the obligation amount applies first to the cash medical support amount, if any, and then to the cash child support amount.

OAR 137-050-0485 (Minimum Order): this new rule authorizes a rebuttable $100 per family minimum order, except in certain situations.

Looking to the Future

The Attorney General is extremely committed to making the Oregon Child Support Program effective and fair to all participants. DCS staff have worked extraordinarily hard to develop and implement this Recession Response project on a very short timeline. I am confident that many families will benefit from the program and that we will be able to learn from this project. Some aspects will work, others not, so please let us know your experience and thoughts.

If you have questions, you may contact me directly and I will attempt to answer you question or point you in the right direction.

Margaret Olney
Special Counsel
Office of the Attorney General
margaret.olney@doj.state.or.us

1162 Court Street, NE
Salem, OR 97301
503.378.6002
971.673.1880 (Portland)
503.367.4017 (fax)

http://www.nytimes.com/2009/03/29/nyregion/29support.html?_r=1&hp

With so many child support obligors either losing their jobs or having a reduction in income, the court is seeing a huge increase in requests for child support modifications.  In many cases, the court has no choice but to reduce the child support obligation.  This often leaves a custodial parent in dire financial straits.  The court, however, must balance the needs of both parents against this reality.  The non-custodial parent must be able to continue to support himself or herself.

In Oregon, child support modifications are governed by Oregon Revised Statute 107.135.  A modification can be instituted via a filing in the circuit court in the county in which the original order was made or by requesting a review through the Department of Justice.  The party requesting the modification must show that there has been a substantial change in circumstances since the prior support award was issued.

A child support award remains in effect until it is modified.  It is crucial, therefore, that a person who owes child support file to modify the support obligation as soon as possible after having a reduction in income. 

For more information, or to receive legal advice on your specific situation, please contact the law offices of Stephens Margolin P.C. in order to schedule a consultation.

On September 24, 2008, the Oregon Court of Appeals published an opinion in South and South, in which the court wrote a not so helpful opinion about child support.  The case did not do much to assist lawyers or clients in dealing with child support issues.  It does give guidance to judges to make clear rulings with detailed facts about any deviation from the presumed amount of child support.

In South, the court confirmed that a party should be imputed an upward adjustment of income if his/her income is tax free.  Since the child support calculator uses “gross income” to determine support levels, it would give a party an unfair advantage to receive tax free income.

The court also ruled that the trial court had to explain why it decided to reduce the amount of support from the presumed amount pursuant to the calculator.  The parties likely spent thousands of dollars fighting over a few hundred dollars of monthly support.  Depending upon the age of the child, that could have been a financially wasteful decision.

Child support in Oregon can be complicated and it is important that parties to a child support case obtain competent legal counsel.  As this opinion shows, even judges often get it wrong.

You can review the full opinion in South and South at http://www.publications.ojd.state.or.us/A131770.htm

If you have any questions about Oregon appellate law please contact Daniel Margolin or C. Sean Stephens at Stephens Margolin P.C.