Summary the Final Report of the Commission to Study Child Support and Related Child Custody Issues Authorized by HB 310 (Final Report filed December 1, 2004) Summary Submitted to the Family Law Subcommittee New Hampshire Citizens Commission on the Courts By James E. Michalik, Commission Member The Child Support Commission issued its final report on December 1, 2004. The Report is an extensive analysis (67 pages) of the following topics: • the background of the legislative establishment of the Commission; • a review of current child support law pursuant to RSA 458-C; • a review of competing models utilized in other states for child support calculations; • analysis of a favored model known as the ‘Cost-Based Model’; • a review of related child support issues; and, • the issuance of ‘Findings and Recommendations’. (The full report is available under the menu topic ‘Resources’ on the NHCCSC Website which is linked to the NH Government Website.) The Commission made 17 specific Findings and Recommendations (report at page 4547) as well as a number of generalized conclusions cited in the text of the Report. I summarize these as follows: 1. The Commission found that child support formulas fall into one of three general categories: i. Income Shares Model (used by 33 states including New Hampshire, in theory) which allocates for each child a proportion of the parents income, from the perspective as if the household was still intact; ii. Percentage of Income Model (used by 13 states including New Hampshire, in practice) which sets child support on a percentage basis (flat or variable) of the non-custodial parent’s income. iii. Melson Formula (used by 3 states) a more sophisticated version of the Income Shares Model which adopts a number of public policy choices to balance the parents self support needs and the child’s need for support. 2. Generally speaking, the Commission found that the current child support guidelines can lead to unfair and inappropriate results and that the guidelines are in need of reform and revision. It appears to be the consensus of the Commission that the guidelines produce unfair results at the high end and low end of family income levels. 3. The majority members of the Commission found that the Cost-Based Model should be adopted by New Hampshire as a cure to most of the shortcomings whether perceived and/or real which current law has created. The ‘Cost- Based Model’ focuses on the ordinary costs incurred in raising children. Generally speaking this model is based on the following criteria: a) Average income from both parents is used to determine the target expenditures for the child, thereby reflecting the highest standard of living available. b) Child related tax benefits would be set off against child expenditures. c) Day care and education would be excluded from the cost tables and treated as add-ons and medical insurance would be reflected in the cost tables. d) The USDA cost tables best reflect real cost data for child rearing. e) Child support awards should not force the obligor’s income below a self support needs. 4. Although no separate minority report was issued, it appears that the minority members were rightfully concerned over a minimalist definition of ‘basic’ costs and they urged the incorporation of a ‘standard of living adjustment’ and other modifications into any final version of the cost based model. 5. The consensus of the Commissioners was that further study of cost based model alternatives should be undertaken and that the Legislature should appropriate funds for an expert review. 6. As of this writing I have not finalized my review of the steps taken to implement the report as I await several return calls from the Chairman and members of the Commission. However, as far as I can determine the following are in progress: a. An economist has been retained by the State to conduct further review and analysis of various child support models. Additionally, I have been told that federal monies are expected towards this expert’s costs, although I have no verification of that fact. b. Representative David Bickford, Vice Chair of the Commission has introduced a number of bills into the House regarding the Commission’s work. I intended to research this further but have not had further opportunity to complete that review. Query: How the Child Support Commission’s report and work affects the NHCCSC’s mission and do our respective tasks overlap? Possible Answers: A. The NHCCSC should view this report in context of other family law related work from other committees and commissions. B. Taking into consideration the report of the Child Support Commission and the Family Law Task Force, other relevant reports and the recent statutory changes involving parenting rights and responsibilities the NHCCSC should make broad policy recommendations to the Supreme Court for child support such as the following: i. child support should be above ideological agendas and focus on the purpose of child support – as measuring tool to determine how divided families should provide financial support to their children; ii. child support should not be so low as to be confiscatory to children nor so high as to be confiscatory to parents; iii. whatever model adopted, child support should be as fair as humanly possible to avoid the extremes (ie. promoting divorce, promoting parental alienation, promoting the abdication of parental responsibility for financial or for support of children in educational and social pursuits, etc.); iv. an appropriate review body should monitor the ongoing review of the economist and any proposed revisions to the child support model; v. the appropriate body should monitor legislative changes to insure that they meet consensus goals or other goals established by the NHCCSC; and, vi. and such other recommendations deemed appropriate. Respectfully submitted to the Subcommittee on December 8, 2005.