UPDATE re Proposed Legislation

Well, the Illinois legislature passed a budget on time and has adjourned for the summer. Notably, they did not pass any of the bills previously described in this blog. Instead, they referred them to the Rules Committee where the legislature could act on the bills in the Fall veto session. We will keep you posted.

Potential Adoption Changes

House Bill 4571 (Feigenholtz, D-Chicago) Makes a number of changes to adoption law. (1) Clarifies that a prospective-adoptive parent may give a gift or gifts to the biological parent if they do not exceed $200 in total. (2) Allows a prospective-adoptive parent to advance a maximum of $1,000 for reasonable birth-parent living-expenses without court approval. But it requires a final accounting of all expenses before entry of a final order. (3) Allows a prospective-adoptive parent to seek reimbursement of reasonable-living expenses from a person who receives these payments for another person who he or she knows not to be pregnant or who receives payments simultaneously from more than one prospective adoptive-parent. (4) Requires court approval if the reasonable attorney fees of the biological parent (to be paid by the prospective-adoptive parents) are more than $1,000. Requires that all fees be included in the final accounting. (5) Expands access by the confidential intermediary to vital records maintained by another state’s vital records’ depository. (6) Clarifies any non-identifying information learned during the confidential intermediary’s search may be given to the petitioner at any time during the search before the case is closed. (7) Allows a confidential intermediary to provide to an eligible petitioner with information about (a) the name and contact information of the agency that had legal custody of or responsibility for the surrendered person and (b) the name of the state in which the surrender or the adoption occurred.

The bill passed unanimously in the House on May 6, 2008. The bill is now pending in the Senate.

Pending Legislation re Computation of Child Support

House Bill 5727 changes the computation of child support to allow a deduction for reasonable educational expenses of a child of the parties who is enrolled in pre-school, elementary, or secondary educational institution. See the ful text of the bill at http://www.ilga.gov/legislation/95/HB/PDF/09500HB5727lv.pdf.

The Bill was referred to the House Rules Committee on March 14, 2008

House Bill Would Include Straight Line Depreciation in Child Support Calculation

Child support is always tough to calculate when the obligor has a business with assets used to produce income, i.e. farming etc. Thanks to tax laws, farmers and other business owners can accelerate depreciation which can in turn dramatically reduce net income for child support purposes. Case law dealing with depreciation deductions varies. If HB 5771 becomes law, the obligor would only be allowed to deduct straight line depreciation of capital assets. The statute would not apply to real estate depreciation.

The proposed legislation also would allow a deduction from net income for "reasonable expenditures for the benefit of the child and the other parent, exclusive of gifts." This is sure to engender litigation in the future over what expenditures are allowed. However, it seems that an obligor could argue that payment for daycare expenses, clothing etc. would be covered by the statute.

The House extended the deadline for final action on the bill to May 9, 2009. Stay tuned . . .

Out of State Employer Subject to Illinois Withholding Order and Penalties

On May 1, 2008, the Second District Appellate Court affirmed the trial court's imposition of a $369,000 penalty ($100 per day) upon the husband's Mississippi employer under the Illinois Withholding statute in In re Marriage of Gulla. The total amount of support that the employer failed to withhold was only $7,854.56.

The employer initially argued that the Illinois Court lacked jurisdiction over it. The Appellate Court quickly disposed of this argument. Mississippi had a law, as required by the United State's Code, that treats an out of state withholding order for child support as if it originated from a Mississippi Court. Since the employer had been served with the withholding order by certified mail, return receipt requested, as specified in the Illinois withholding statute, the trial court correctly concluded that it had jurisdiction over the Mississippi employer.

The employer then made several equitable arguments; all of which failed. The employer claimed it was advised by the husband's attorney that he and his former wife had reached an agreement and the employer did not have to honor the withholding order. The employer also argued the withholding order obligated it to withhold more than the employee earned and more than was allowed by state and federal law. The Appellate Court rejected this argument, as the withholding order plainly stated the employer was limited in withholding the amount stated in the order or whatever was allowed by law.

Finally, the employer argued the statute was unconstitutional because the penalty was
totally disproportionate to the violation being punished. The Appellate Court denied this argument based upon the recent Illinois Supreme Court decision in In re Marriage of Miller, 227 Ill. 2d 185, 198, 203 (2007).

The full text of the Gulla opinion can be found at:

http://www.state.il.us/court/Opinions/AppellateCourt/2008/2ndDistrict/May/2070387.pdf

This case along with Miller show the Courts' willingness to apply and uphold the penalty provisions of statutes designed to help collect child support in Illinois. These rulings will no doubt cause practitioners to add this as a weapon to their arsenals in collecting child support for their clients.