January 29, 2000

Comment related to Title 25, section 320 of the Arizona Revised Statutes: Marriage and Domestic Relations - Child support; factors. 'A' and factors 1-5.

Arizona uses a child support guideline based on the Income Shares model developed by Policy Studies, Inc., (PSI) the mother company of a child support collection agency.

When this Income Shares model was created, basic mathematical problems in child support decision making had not yet been solved. In addition, no database on child raising costs existed either nationally nor for Arizona. The Income Shares model was then developed using what a Washington State researcher called an;
 

"... opaque and highly derivative expert interpretations of existing but fundamentally off-target primary economic data."

In their book, "Allocation of Income Within the Household," University of Chicago professors Edward P. Lazear and Robert T. Michael referred to the same child cost estimates. (University of Chicago Press, 1988, page 25)
 

". . . the presumption that underlies the focus of much of the empirical research and policy debate on income distribution seems born of ignorance and is supported by neither theory nor fact. This situation can be improved."

An old problem exists in the design of the Arizona guidelines. Tables are used which allegedly represent child raising costs. But "cost" is not objectively defined, nor are the estimates used based on real child raising data. The problem is strongly related to the logic of child support decision making and the inadequacy of the science of child support decision making when the federal requirement for presumptive guidelines took effect.

Arizona law specifies that child support decisions shall include consideration of the needs of the child, the resources of the parents, the needs of parents, and "the standard of living the child would have enjoyed had the marriage not been dissolved."

If it had not been for the last factor stated above (factor 3 in 25-320A) the logic of child support decision making would be somewhat simpler. Consideration of what might have been if the marriage had not dissolved requires an adjustment to the simple "cost sharing" method; which was based on what custodial parents spend. This adjustment has traditionally been called the "standard of living (SOL) adjustment."

As an SOL "add-on," Family Court judge Melson, who developed the Delaware Melson formula, prescribed an addition of 5% of a payer's remaining income after other basic child support costs had been accounted for. Judith Cassetty, whose mathematical model appears in PSI's 1987 OCSE report, pointed out that no mathematical solution to the SOL problem existed, and completed her model using an income equalization approach.

The PSI Income Shares model handles the SOL adjustment problem arbitrarily, by using arbitrarily high "cost" tables which provide values that are entirely unrelated to post-divorce child support needs.

In 1994, PICSLT (see below) derived the first mathematical solution to the standard of living adjustment problem. We assert therefore, that the science of child support decision making has progressed to the point that PSI's Income Shares model is obsolete. A paper on the new mathematics is available for download from the world wide web. It can be reached through the page on development of a new child support guideline model, PICSLT-2000, at the project web site. (address given below)

Project for the Improvement of Child Support Litigation Technology (PICSLT) is an R&D project that focuses on the science, engineering, and application of child support guidelines. Project work began in 1989 with investigations at Intelligent Systems Research Corporation and has continued as an independent project since 1994.

Roger F. Gay, Project Leader
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