CS 085P Interest

02/14/00 Revised 11/08/11 Training Completed 11/18/11

45 CFR 303.7; UCA 15-1-4


Statutory Authority


UCA 15-1-4 Interest on judgment states:
   “(1) As used in this section, "federal postjudgment interest rate" means the interest rate established for the federal court system under 28 U.S.C. Sec. 1961, as amended.
(a) Except as provided in Subsection (2)(b), a judgment rendered on a lawful contract shall conform to the contract and shall bear the interest agreed upon by the parties, which shall be specified in the judgment.
     (b) A judgment rendered on a deferred deposit loan subject to Title 7, Chapter 23, Check Cashing and Deferred Deposit Lending Registration Act, shall bear interest at the rate imposed under Subsection (3) on an amount not exceeding the sum of:
     (i) the total of the principal balance of the deferred deposit loan;
     (ii) interest at the rate imposed by the deferred deposit loan agreement for a period not exceeding 10 weeks as provided in Subsection 7-23-401(4);
     (iii) costs;
     (iv) attorney fees; and
     (v) other amounts allowed by law and ordered by the court.
     (3) (a) Except as otherwise provided by law, other civil and criminal judgments of the district court and justice court shall bear interest at the federal postjudgment interest rate as of January 1 of each year, plus 2%.
     (b) The postjudgment interest rate in effect at the time of the judgment shall remain the interest rate for the duration of the judgment.
     (c) The interest on criminal judgments shall be calculated on the total amount of the judgment.
     (d) Interest paid on state revenue shall be deposited in accordance with Section 63A-8-301.
     (e) Interest paid on revenue to a county or municipality shall be paid to the general fund of the county or municipality.”


Although by law interest may accrue on a child support debt, and the obligation to pay interest is included in some child support orders and judgments taken by the Office of Recovery Services\Child Support Services (ORS\CSS), CSS is unable to calculate and collect interest until such time that interest may be calculated automatically by the ORS computer system (ORSIS).  In October, 2003, CSS removed reference to interest in administrative notices and orders to avoid giving the impression that CSS calculates and collects interest.


Presently, CSS only collects interest in some cases and only calculates interest on cases that meet the criteria for referral to the Attorney General’s Office (AGO) for prosecution of criminal non-support, if interest is owed to the custodial parent (CP).  Interest is not calculated on state’s arrears.  Prosecuting attorneys on criminal non-support cases will attempt to obtain a restitution order for the amount of arrears owed to both the CP and the State, and interest owed to the CP at a standardized rate of 3% per annum on cases filed as of March 1, 2002. (The CP may still pursue any additional interest due as a separate request to the Court in the criminal case.)   NOTE:  On criminal cases filed between June 16, 2001 and March 1, 2002, the standardized interest rate is 5.5% per annum.  The rate prior to June 16, 2001 is the interest rate referred to in UCA 15-1-4.


Interest owed on criminal cases is calculated on the “Criminal Interest Calculation Worksheet.”  Only assigned local office Quality Assurance (QA) specialists who refer criminal non-support cases may complete this worksheet. 


Collecting Interest


CSS will collect interest if one or more of the conditions below are met.


1.                  The interest amount has been reduced to a specific lump-sum amount in a judicial order or judgment.  Since CSS does not provide this service, the non-custodial parent (NCP) or the CP will need to pursue a separate legal action to obtain a judicial order or judgment for interest.


2.                  A Non-IV-A case is referred by CSS for civil action and the court requests a specific dollar interest amount; the CP or his/her private attorney provides the interest calculation to the court and the court reduces the interest amount to a specific sum-certain judgment in the judicial order.


3.                  On an incoming interstate case, the IV-D agency in the initiating state has calculated and provided to ORS a specific interest amount.  If the initiating state provide2 ORS with a legitimate interest calculations and updates to support the interest being enforced, adjust the case accounting records accordingly.


The initiating state is responsible to provide annual notice or notice upon request of interest amounts charged on all cases being enforced by another state, if the order was issued by that state (45 CFR 303.7 (c)(7). 


4.                  On an outgoing interstate case, ORS will not add interest to the debt(s), unless the interest amount has been adjudicated.  If the responding state notifies ORS that interest has been adjudicated, add the amount to the case debt(s).    


5.                  A case is referred for criminal prosecution and the court issues a restitution order for child support and interest.  The assigned regional/local QA will load the restitution order on ORSIS based on the amounts reflected on the “Criminal Interest Calculation Worksheet.”  The restitution order will replace the existing child support debts. 


Currently CSS forgives interest that has accrued on IV-A debts.  If interest has accrued on a Non-IV-A debt, the NCP owes the interest to the CP and must pay the interest directly to the CP (or through a private attorney or agent), unless CSS is collecting the interest based on a condition listed above, or the Non-IV-A CP agrees to waive the interest (on a judicial judgment only). 


To satisfy a judicial judgment, ask the AGO to prepare a Judicial Satisfaction order which will contain the interest waiver language.  The CP must sign the interest waiver portion of the satisfaction before it is filed.  Before referring the case to the AGO to request a satisfaction, obtain the CP’s authorization to waive the interest.  If the CP does not agree to waive the interest, the CP will need to collect the interest on his/her own, and the judgment cannot be satisfied until the CP gives his/her authorization


CSS treats interest in child support cases (in-state and interstate) as additional child support owed on the case.  When loading child support and interest on ORSIS, combine the child support arrears and the interest amount into a single child support debt, so that the entire amount of principal and interest can be collected and distributed as child support. 


Initiating State Responsibility    


Pursuant to 45 CFR 303.7(c)(7), an initiating state must, provide annual notice to the responding agency regarding amount of interest charges owed on cases with overdue support owing on an initiating state order and upon request in an individual case.”


If ORS/CSS is enforcing an order issued by another state at the request of that state (incoming intergovernmental case) and that state charges interest on unpaid child support, they are responsible to calculate the interest owed and provide annual notice to ORS/CSS, or upon request.