[Federal Register Volume 71, Number 99 (Tuesday, May 23, 2006)]
[Rules and Regulations]
[Pages 29590-29592]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-4731]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Administration for Children and Families

45 CFR Part 303

RIN 0970-AC19


Child Support Enforcement Program; Reasonable Quantitative 
Standard for Review and Adjustment of Child Support Orders

AGENCY: Office of Child Support Enforcement (OCSE), Health and Human 
Services (HHS).

ACTION: Final rule.

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SUMMARY: This rule finalizes without change the provisions of the 
Interim Final Rule published on December 28, 2004 and responds to 
public comments received as a result of the interim final rule. The 
rule permits States to use a reasonable quantitative standard to 
determine whether or not to proceed with an adjustment of an existing 
child support award amount after conducting a review of the order, 
regardless of the method of review used.

DATES: These regulations are effective May 23, 2006.

FOR FURTHER INFORMATION CONTACT: Paige Biava, Division of Policy, OCSE, 
202-401-5635, e-mail: [email protected]. Deaf and hearing-impaired 
individuals may call the Federal Dual Party Relay Service at 1-800-877-
8339 between 8 a.m. and 7 p.m. eastern time.

SUPPLEMENTARY INFORMATION:

Statutory Authority

    The provisions of this regulation pertaining to review and 
adjustment of child support orders are published under the authority 
granted to the Secretary by section 466(a) of the Social Security Act 
(the Act), 42 U.S.C. 666(a). Section 466(a) requires each State to have 
in effect laws requiring the use of specified procedures, consistent 
with this section of the Act and regulations of the Secretary, to 
increase the effectiveness of the Child Support Enforcement program. 
Review and adjustment of support orders at section

[[Page 29591]]

466(a)(10) of the Act is one of the required procedures.

Paperwork Reduction Act of 1995

    No new information collection requirements are imposed by these 
regulations, nor are any existing requirements changed as a result of 
their promulgation. Therefore, the requirements of the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3507(d)), regarding reporting and 
record keeping, do not apply.

Regulatory Flexibility Analysis

    The Secretary certifies, under 5 U.S.C. 605(b), as enacted by the 
Regulatory Flexibility Act (Pub. L. 96-354), that this rule will not 
result in a significant impact on a substantial number of small 
entities. The primary impact is on State governments. State governments 
are not considered small entities under the Act.

Regulatory Impact Analysis

    Executive Order 12866 requires that regulations be reviewed to 
ensure that they are consistent with the priorities and principles set 
forth in the Executive Order. The Department has determined that this 
rule is consistent with these priorities and principles. This 
regulation is considered a ``significant regulatory action'' under 3(f) 
of the Executive Order, and therefore has been reviewed by the Office 
of Management and Budget.

Unfunded Mandates Reform Act of 1995

    Section 202 of the Unfunded Mandates Reform Act of 1995 requires 
that a covered agency prepare a budgetary impact statement before 
promulgating a rule that includes any Federal mandate that may result 
in the expenditure by State, local, and Tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any one 
year.
    If a covered agency must prepare a budgetary impact statement, 
section 205 further requires that it select the most cost-effective and 
least burdensome alternative that achieves the objectives of the rule 
and is consistent with the statutory requirements. In addition, section 
203 requires a plan for informing and advising any small governments 
that may be significantly or uniquely impacted by the rule.
    We have determined that the final rule will not result in the 
expenditure by State, local, and Tribal governments, in the aggregate, 
or by the private sector, of more than $100 million in any one year. 
Accordingly, we have not prepared a budgetary impact statement 
specifically addressing the regulatory alternatives considered, or 
prepared a plan for informing and advising any significantly or 
uniquely impacted small governments.

Congressional Review

    This regulation is not a major rule as defined in 5 U.S.C. chapter 
8.

Assessment of Federal Regulations and Policies on Families

    Section 654 of the Treasury and General Government Appropriations 
Act of 1999 requires Federal agencies to determine whether a proposed 
policy or regulation may affect family well-being. If the agency's 
determination is affirmative, then the agency must prepare an impact 
assessment addressing seven criteria specified in the law. These 
regulations will not have an impact on family well-being as defined in 
the legislation.

Executive Order 13132

    Executive Order 13132 on Federalism applies to policies that have 
Federalism implications, defined as ``regulations, legislative comments 
or proposed legislation, and other policy statements or actions that 
have substantial direct effects on the States, or on the distributions 
of power and, responsibilities among the various levels of 
government.'' This rule does not have Federalism implications for State 
or local governments as defined in the Executive Order.

Summary Description of Regulatory Provisions

    This rule finalizes without change provisions of the Interim Final 
Rule published in the Federal Register on December 28, 2004 (60 FR 
77659) and permits States to use a reasonable quantitative standard to 
determine whether or not to adjust an existing child support award 
amount after conducting a review of the order, regardless of the method 
of review used.
    Under this final rule, a State may establish a reasonable 
quantitative standard, based on either a fixed dollar amount or 
percentage, or both, as a basis for determining whether an 
inconsistency between the existent child support award amount and the 
amount of support as determined as a result of a review is adequate 
grounds for petitioning for adjustment of the order, regardless of the 
method of review. This allows States to manage their limited resources 
and refrain from seeking unreasonably small order adjustments whenever 
the existing order amount varies by any amount, however small, from the 
amount calculated under the State's guidelines. Very few States have 
automated review processes in place. The application of child support 
guidelines often involves far more than a simple calculation based upon 
one parent's income, and may include decisions with respect to child 
care, health insurance and extraordinary medical expenses. This rule 
minimizes the burden, stress and uncertainty families would face in 
opening up their orders to change despite little anticipated gain. In 
addition, the rule reduces complex agency and tribunal record-keeping 
that could lead to errors, and lessens the burden on employers who 
would need to respond to constantly adjusting income withholding orders 
to address small differences in the amount withheld.
    Section 303.8 continues to require State child support enforcement 
(IV-D) agencies to review child support orders at least every 3 years, 
upon request of a parent in any IV-D case, and upon request of the 
State if there is an assignment of support rights under title IV-A of 
the Act, and make adjustments, if appropriate, i.e. if the reasonable 
quantitative standard for an adjustment is met. Further, under 
paragraph (b)(5) of this section, a State must have procedures, under 
which a parent or other person who has standing may request a review 
and adjustment outside the regular 3-year (or shorter) cycle and if the 
requesting party demonstrates a substantial change in circumstance, for 
adjusting the order in accordance with its support guidelines.
    We note that the Deficit Reduction Act of 2005 (Pub. L. 109-171) 
amended the child support statute (42 U.S.C. 666(a)(10)) related to 
review and adjustment of support orders to require States, effective 
October 1, 2007, to review all cases with an assignment of support 
rights under title IV-A every three years. We will issue separate 
regulations addressing this change.

Response to Comments

    We received two comments from an advocate. Responses to these 
comments follow. We also received comments in favor of the regulation 
from four State IV-D agencies.
    Section 303.8--Review and adjustment of child support orders
    Comment: One commenter stated that the interim final rule is not 
consistent with Federal statute.
    Response: We disagree. The regulation is consistent with Federal 
statute as originally interpreted in 1993 and as construed in OCSE-AT-
97-10, on July 30, 1997. Section 466(a)(10)(A)(i)(I) of the Act, as 
amended by section 351 of Public Law 104-193, does not preclude a State 
law

[[Page 29592]]

from providing a threshold deviation before an adjustment of an order 
is appropriate. Under section 466(a)(10)(A)(i) of the Act, the State 
must take ``into account the best interests of the child involved.'' A 
small reduction in support, or even an increase, because of a 
difference between the current order and the order amount calculated 
during a review, might not be in the child's best interests. The rule 
that allowed states to apply a reasonable quantitative standard for 
adjustment of an order was in effect for ten years. During that period 
there was no indication or evidence that the best interest of children 
would have been better served by requiring even incremental adjustments 
to orders (whether increases or decreases). On the contrary, we believe 
such frequent small changes to orders would have caused stress, 
uncertainty and confusion, and would have imposed an unreasonable 
administrative burden upon state agencies. In summary, such changes 
would not have been ``appropriate.''
    (As previously noted, we will be issuing separate regulations to 
address the changes made to section 466(a)(10) by the Deficit Reduction 
Act.)
    2. Comment: This commenter also said that the interim final rule 
has the potential to harm needy children and parents. If the amount of 
the potential increase doesn't meet the quantitative standard, the 
child would be deprived of an amount of money that isn't insignificant 
over a year. The same commenter also stated that, if a change in the 
order amount would be a decrease and isn't sought, the low income 
obligor would be burdened with an excessive order or fall into arrears.
    Response: We do not agree. Since the issuance of the Action 
Transmittal, we are aware of no evidence of harm done to families or 
obligated parents. We believe authority given to States by this 
regulatory change is necessary and consistent with the law.
    As outlined in the preamble to the Interim Rule, OCSE issued policy 
on review and adjustment of orders in OCSE-AT-97-10 on July 30, 1997. 
Under section 466(a)(10)(A)(i)(I) of the Act, the language ``if 
appropriate, adjust the order'' is consistent with regulations which 
say that, if a State reviews a case under the 3-year cycle provision 
using State guidelines, it can determine not to adjust the order if the 
inconsistency between the current order and the guideline amount does 
not meet the ``reasonable quantitative standard established by the 
State.'' Under the regulations, the State could establish a reasonable 
quantitative standard based upon either a fixed dollar amount or 
percentage, or both, as a basis for determining whether an 
inconsistency between the existing child support award amount and the 
amount of support which resulted from application of the guidelines was 
adequate grounds for petitioning for adjustment of the order. The state 
should, of course, continue to take into account any significant 
changes.
    Either party may still ask for a review and modification of the 
child support order notwithstanding the state's threshold rule limiting 
mandatory procedures requiring the IV-D agency to seek such small 
adjustments. The thresholds established by each state avoid de minimus 
actions which a court may reject anyway. This rule minimizes the 
burden, stress and uncertainty families would face in opening-up the 
order to change despite little anticipated gain.

List of Subjects in 45 CFR Part 303

    Child support, Grant programs--social programs.

(Catalog of Federal Domestic Assistance Programs No. 93.563, Child 
Support Enforcement Program)

PART 303--STANDARDS FOR PROGRAM OPERATIONS

0
Therefore, the interim final rule amending 45 CFR part 303 which was 
published on December 28, 2004 (69 FR 77659) is adopted as final 
without change.

    Dated: January 20, 2006.
Wade F. Horn,
Assistant Secretary for Children and Families.
    Date Approved: February 17, 2006.
Michael O. Leavitt,
Secretary of Health and Human Services.
[FR Doc. 06-4731 Filed 5-22-06; 8:45 am]
BILLING CODE 4184-01-P