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340:25-5-140.1. Interest

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Revised 7-1-06

(a) General. The Child Support Enforcement Division (CSED) collects and enforces interest on delinquent Oklahoma court-ordered child support payments under Section 114 of Title 43 of the Oklahoma Statutes.

(b) Support for a prior period. CSED collects interest on support for a prior period established under OAC 340:25-5-179.1 from the date of the order. • 1

(c) Accrual date. Interest accrues on any unpaid portion of the monthly current child support obligation on the first day of the month following:

(1) the due date specified in the court order; or
(2) the entry date of the child support order when a support order does not specify a due date. • 2

(d) Grace period and accrual. CSED may allow a grace period during which interest is not charged. Interest accrues from the date the arrears are in excess of one month's current support. • 3

(e) Servicemember relief.

(1) Upon a servicemember's written request, an interest rate cap of six percent applies to child support arrearages of members of the military service incurred prior to the start of military service under Section 527 of Title 50A of the United States Code. • 4
(2) The servicemember must provide to CSED not later than 180 days after the date of the servicemember's termination or release from military service a written request for reduced interest and a copy of the military orders calling the servicemember to service and any orders further extending military service.
(3) Upon receipt of these documents, CSED applies the six percent interest rate to child support arrearages existing as of the date on which the servicemember is called to military service and throughout the active military service.
(4) CSED may initiate a court action to challenge the claim that the servicemember's military duty has materially affected his ability to pay an interest rate over six percent. • 5

(f) Interest rate.

(1) CSED calculates simple interest under Section 114 of Title 43 of the Oklahoma Statutes. • 6
(2) For orders established in other states, the law of the state entering the order determines the amount and rate of interest due until a determination of controlling order is made. • 7 through 10
(3) For orders established in Oklahoma, Oklahoma law determines the amount and rate of interest due.
(4) When there are multiple child support orders and Oklahoma is determining the controlling order, CSED determines the rate of interest to be charged as described in Section 601-604 of Title 43 of the Oklahoma Statutes. • 7

(g) Order silent as to interest. When an order that settles a child support arrearage is silent as to interest, the party with the right to collect has not waived the interest. • 10

(h) Enforcement. Accrued interest is considered child support. Interest is included in enforcement remedies.

(i) Incoming interstate cases. In the absence of an Oklahoma order, CSED collects interest on incoming interstate cases when an initiating state calculates the interest owed and requests that CSED collect it. • 8 & 11

(j) Outgoing interstate cases. Before requesting a responding state to enforce a child support order(s) entered in a state other than the responding state, CSED calculates the arrears including the accrued interest claimed. • 8

(k) Application of payments to interest. CSED applies payments to interest as described in OAC 340:25-5-351.

(l) Waiver of interest. CSED acknowledges the rights of the custodial person and noncustodial parent to mutually agree to waive, with approval of the court, all or a portion of the interest due to the custodial person. CSED may negotiate the right to collect all or part of the interest owed to the State of Oklahoma. Settlements of interest may include:

(1) a noncustodial parent's lump sum partial payment or a series of payments; or
(2) an agreement for the noncustodial parent to pay:
- (A) a specified number of current child support payments in the future; or
- (B) in-kind payments. • 12

(m) Reopening closed cases. CSED does not reopen closed child support cases at the request of a customer for the purpose of collecting interest.

INSTRUCTIONS TO STAFF 340:25-5-140.1

Revised 7-1-08

1. Orders for support for a prior period are obtained in paternity and notice of support debt cases under OAC 340:25-5-179.1. Support for a prior period is defined in OAC 340:25-1-1.1.

2. Child support staff attempt to calculate interest from the accrual date in the original child support obligation, unless interest has been calculated and included in a judgment provision in a subsequent order. Child support staff use Form 03EN002E, Affidavit of Child Support Payments Received, to obtain child support payment information from a custodial person.

(1) When child support staff do not have information on how a judgment was determined or on the amount of past-due child support accrued prior to when the Child Support Enforcement Division (CSED) opened the child support case, child support staff mail the Interest Disclosure Notice document to the custodial person to gather this information and determine the calculation period. The Interest Disclosure Notice is available from the CSED InfoNet Library page.

(2) If the custodial person fails to supply the information within two weeks or the information is not available, child support staff update the automated Oklahoma Support Information System (OSIS) with interest balances that have accrued on child support arrearages from the date adequate payment documentation exists. Child support staff include the amount and time period of the interest accrued on the child support judgment in the child support order.

3. Grace periods are intended to accommodate obligors who pay by income assignment, but they apply to all obligors.

4. Any arrearage incurred after the date the servicemember is called to active military service accrues interest at the statutory rate of ten percent.

5. CSED challenges the six percent interest rate if the servicemember is earning as much income in the military service as in non-military service.

6. See Phillips v. Hedges, 2005 OK 77, which interprets Section 114 of Title 43 of the Oklahoma Statutes as meaning that simple interest is applied to delinquent child support payments.

7. When using the one-state process to enforce an order established in another state, it is the responsibility of child support staff to calculate interest using the interest rate of the state that established the order, also known as the issuing state.

8. (a) When there is no initiating state, child support staff calculate the interest due on all existing child support orders in an action to enforce those arrears, even if the order was entered in another state.

(b) Child support staff follow the federal Office of Child Support Enforcement (OCSE) Dear Colleague Letter DCL-03-27, available from the OCSE Web site at http://www.acf.hhs.gov/programs/cse/pol/DCL/2003/dcl-03-27.htm.

(c) To determine the current applicable interest rate for orders from other states, child support staff may use the reconciliation calculator provided in DCL-03-27, or the OCSE online Intergovernmental Referral Guide on the Internet at http://ocse3.acf.hhs.gov/ext/irg/sps/selectastate.cfm.

(d) Child support staff consult with the district office state's attorney to determine if the interest rate has changed during the period when the arrears accrued.

9. CSED requests that an Oklahoma court determine the accrued principal and interest and registers that order with the responding state for enforcement when:

(1) Oklahoma asks another state to enforce arrears due under an Oklahoma child support order; and

(2) service of process can be obtained on all parties.

10. Oklahoma courts have consistently held that where a statute authorizes interest, interest is not an element of damages and is recoverable regardless of whether it is specifically referred to in the order.

11. When using the two-state process in interstate cases, it is the responsibility of the initiating state to calculate whether the noncustodial parent has paid all current support, arrears, and interest under the law of the state that issued the order. [43 O.S. § 601-604]

12. Waiver of interest.

(1) Child support staff use the Custodial Person's Waiver of Interest in Conjunction with a Settlement legal settlement document on OSIS.

(2) Child support staff include in the court order settlement terms of the waiver of interest. The district office state's attorney must approve all settlements of interest owed to Oklahoma.

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