Cost-of-Living Adjustment
In this Topic
Introduction
The New Jersey Supreme Court promulgated Rule 5:6B, which required that all child support orders entered, modified, or enforced on or after September 1, 1998, be eligible for an upward adjustment every two years to reflect the cost of living. In addition, as of September 1, 2009, orders and judgments that include child support entered, modified, or enforced on or before August 31, 1998 are subject to adjustment every two years going back to September 1, 1998, to reflect the cost of living. The adjustment is based on the average monthly change in the CPI for the New Jersey metropolitan area.
Agency Responsibilities
Selection of the cases for COLA procedures is automated and requires no action by staff. The designated PCSE staff is responsible for reviewing supporting documentation when a COLA notice is contested and for updating NJKiDS.
Process
Once a PCSE case has been identified as being eligible for COLA, a notice is sent to both parties. The obligor is given 30 days to contest the implementation of the COLA. The adjustment becomes effective automatically, unless it is contested. If there is no contest to the notice, a notice of the adjusted order is sent to both parties.
Note: Receipt of a COLA notice may prompt questions. If either party indicates that he or she desires a modification of the child support order because of a change in circumstances, the PCSE Unit should refer the party to the Family Division in the county of venue to file a motion of modification.
Contest
The obligor may contest the adjustment based solely on one or more of the following:
- The person contesting the adjustment is not the obligor or obligee identified in the notice.
- The amount of the child support indicated in the notice is incorrect.
- The child support order contains a provision for an alternative form of periodic review.
- The obligor’s income did not increase at a percentage rate at least equal to the amount of the CPI calculation.
Accompanying Documentation for Contest
If the written contest is based on any of the reasons listed above, accompanying documentation must be included, as outlined below:
| Reason for Contest | Accompanying Documentation |
|
Wrong person |
Photocopy of identification with birth date and Social Security Number |
|
Wrong child support amount |
Copy of a court order signed by a Superior Court Judge, Family Division |
|
Alternative periodic cost-of-living adjustment |
Current order that stipulates an alternative review schedule |
|
No increase in obligor’s income or an increase in obligor’s income below amount of CPI |
Copies of the following financial information: tax returns; W-2 forms; employer 1099 forms; award letters for Public Assistance, Social Security, or other public entitlements covering the three-year period immediately preceding the COLA contest |
COLA Administrative Review Determination
The designated PCSE staff performs an administrative review of the written contest, determines one of the outcomes shown below, and updates NJKiDS.
| Determination | Comments | Action |
|
COLA will be applied |
COLA contest is denied |
Adjustment takes effect on the date in the original notice |
|
No COLA adjustment |
COLA contest is granted |
Information on COLA record is deleted |
|
Case to be heard before a Child Support Hearing Officer or a Superior Court Judge, Family Division, for further review |
The PCSE staff is unable to determine if COLA should apply |
Formal hearing is scheduled and the PCSE staff completes a COLA worksheet |
|
Case is COLA exempt |
Alternative form of periodic review exists on the order |
Exempt case from COLA |
NJKiDS generates a notice that informs both parties of the decision made with regard to the COLA. Either party may contest the COLA determination made by the PCSE Unit within 10 days of the date of the notice. The PCSE staff schedules appeals before a Child Support Hearing Officer and mails a notice of the hearing to the parties.