Department of Health and Human Service
Departmental Appeals Board
AFDC QUALITY CONTROL REVIEW PANEL
SUBJECT: Washington Department
of Social and Health Services
Docket No. A-93-161
Decision No. QC49
DATE: September 2, 1993
DECISION
The Washington Department of Social and Health Services
(Washington)
appealed the April 14, 1993 quality control
(QC) review determination of the
Regional Administrator
of the Administration for Children and Families (ACF)
that an Aid to Families with Dependent Children (AFDC)
assistance unit
was overpaid for the review month of
June, 1992. ACF determined that
the mother had
unreported income which Washington failed to consider in
calculating the amount of assistance.
For the reasons discussed below, we sustain ACF's
determination.
Background
The assistance unit consists of one minor child. The
child lives
with his mother, who is ineligible for AFDC
due to her alien status, under
45 C.F.R. � 233.50(c).
Section 402(f)(2) of the Social Security Act
(Act)
provides that the income of an alien parent who is
ineligible for
AFDC is considered available to the
assistance unit to the same extent as
the income of a
stepparent. The federal regulations (and the
Washington
Administrative Code (WAC)) provide a "stepparent deeming
formula" which dictates how much of a stepparent's income
is considered
to be available to the assistance unit.
The parties agreed that the mother had income from
unreported employment
that Washington had failed to
discover. ACF determined that the
assistance unit
received a $95 overpayment because Washington failed to
consider this income in determining the AFDC grant for
the review
month.
Washington disputed ACF's overpayment determination.
Washington
asserted that the unreported earnings would
not have resulted in a lower
AFDC grant because, under
the stepparent deeming formula, a portion of a
stepparent's income, attributable to the needs of the
stepparent, is not
considered available to the assistance
unit and thus "disregarded" in
determining the amount of
the grant. Application of this disregard to
the alien
mother's income, Washington asserted, meant that the
assistance unit would have received the same grant as it
did when her
income was not considered.
ACF asserted that the under federal and State
regulations, the alien
mother was not entitled to have a
portion of her income allocated to her
needs (and thus
disregarded in determining the grant award) because she
had failed to cooperate with Washington's efforts to
obtain child
support from the child's absent father.
Washington responded that this
bar on disregarding income
for the needs of non-cooperating persons applies
only to
those who are required to be included in the assistance
unit. Here, the mother was excluded from the assistance
unit
because of her alien status, Washington asserted,
and so the bar on
disregarding income for a non-
cooperating person's needs did not
apply. Washington
also argued that there was no determination that the
alien mother had failed to cooperate with support
enforcement efforts,
and that, in any event, she was not
required to cooperate as she was neither
an applicant for
nor a recipient of AFDC.
As explained below, we first find that ACF demonstrated
that
non-cooperation was effectively established in this
case, and that the only
reason that a formal
determination of non-cooperation was not made was
because
of Washington's failure to follow its own procedures. We
next determine that Washington's regulations require that
a disregard
not be applied to income of a non-cooperating
stepparent who is not in the
assistance unit, and that
this action was not barred by or inconsistent with
the
applicable federal regulations. Accordingly, we sustain
ACF's
overpayment determination.
Applicable federal law and regulations
Title IV-A of the Act provides for payments to needy
families with
dependent children. Section 406(b) of the
Act defines "aid to families
with dependent children" as
money payments with respect to a dependent child
including money payments to meet the needs of the
relative with whom any
dependent child is living.
Section 402(a)(7) of the Act requires
states to consider
income and resources in determining need for
assistance.
Section 402(f) of the Act (created by section 201(b)(1)
of Pub. L. No.
99-603, the Immigration Reform and Control
Act of 1986) provides that the
normal requirement, in
section 402(a)(38) of the Act, that a parent's income
and
needs be considered in determining the needs of the
dependent child
and the assistance unit shall not apply
to a disqualified alien parent of a
dependent child
(including, the parties agreed, the mother of the
dependent child here). Instead, section 402(f) provides
that the
needs of the alien parent shall not be taken
into account in determining the
needs of the dependent
child, but that the income of such alien parent shall
be
included to the same extent as the income of a
stepparent.
The stepparent deeming formula, at 45
C.F.R.
� 233.20(a)(3)(xiv), requires the states, in
determining a
dependent child's needs, to subtract
several disregards from the
stepparent's income,
including:
(B) An additional amount for the support of
the
stepparent and any other individuals who
are living in the home, but whose
needs are not
taken into account in making the AFDC
eligibility
determination except for sanctioned
individuals or individuals who are
required to
be included in the assistance unit but have
failed to
cooperate and are or could be claimed
by the stepparent as dependents for
the
purposes of determining his or her Federal
personal income tax
liability. This
disregarded amount shall equal the State's need
standard amount for a family group of the same
composition as the
stepparent and those other
individuals described in the preceding
sentence; . . .
In pertinent part, the WAC provides that:
After applying the earned income work expense
and dependent care
exemptions allowed to WAC
388-28-570(6), the department shall allot the
income of a parent or stepparent in the
household, but not in the
assistance unit as in
subsections (1)(a), (b), and (c) of this
section. The department shall not allot any
income to the needs of
the parent or stepparent
if that person is sanctioned or failed to
cooperate with the department.
WAC � 388-28-560(2). ACF Difference Letter, April 14,
1993. 1/
Analysis
1. Non-cooperation was effectively established, and the
mother
should have been sanctioned.
Washington argued that no determination had ever been
made that the
client had failed to cooperate. Washington
reported that, under its
regulations and pursuant to a
court order in settlement of a suit against
the State,
its IV-D (child support enforcement) agency (Office of
Support Enforcement, OSE) cannot make determinations of
non-cooperation. Instead, OSE must send its evidence to
the client
and to the IV-A (AFDC) agency (Community
Services Organization, CSO) which
makes the determination
after providing the client an opportunity to submit
evidence. 2/ Washington asserted that the procedure
was never applied in this case.
To implement these requirements, Washington's procedures,
at Manual F,
Chapter 21.20, "Noncooperation with OSE,"
state that, when OSE provides
evidence that a client has
failed to cooperate in obtaining support, the
AFDC worker
should review the file for information which may conflict
with the evidence. If the evidence of non-cooperation is
reasonable and the case file review does not provide an
acceptable
reason for non-cooperation, the AFDC worker
should remove the client's needs
from the grant and
establish a protective payee for the children.
Case record evidence provided by ACF demonstrates that
Washington had
taken steps to make a determination of
non-cooperation, but failed to
complete its required
procedures. This evidence consists of:
o A "support enforcement cooperation evidence" form
sent by OSE to
CSO indicating that the mother had
failed to cooperate because she failed to
call and
make an appointment. ACF Ex. C.
o A case form for the mother also showing that she
declined to claim
good cause for her failure to
cooperate.
o An entry in the CSO case record, dated March 24,
1992, which
states "rec'd OSE non-coop. No action
as A/R is not on the
grant." (ACF reported, and
Washington did not dispute, that "A/R"
means
applicant/recipient.) A similar entry appears for
July 23,
1992.
Thus, although there was evidence of non-cooperation,
Washington never
completed the process of making a
determination of non-cooperation, since
the mother was
not included in the AFDC grant. However, as noted in
our
discussion below, she had unreported income which should
have been
considered in determining the child's needs,
and that this income is reduced
by an amount attributable
to the mother's needs. The only reason that
the mother
was not sanctioned, or determined to have failed to
cooperate, was because of Washington's inaction.
Similarly, the settlement and order in De Armond v.
Sugarman, (U.S.D.C.
W.D. Washington, No. C88-608T, June
8, 1989), which mandated the above
procedures, does not
bar ACF from determining that non-cooperation was
established for the purposes of the QC review process.
As noted
above, the absence of a determination of non-
cooperation was due to
Washington's failure to carry out
the process dictated by the court
settlement and
reflected in its procedures. Washington cannot now
benefit from its failure to follow its procedures by
claiming that
non-cooperation was never established. By
analogy, a state cannot
avoid a determination for QC
error rate purposes that it made an
overpayment, or a
payment to an ineligible person, simply because it never
took action to reduce or terminate benefits and never
went through its
required process of affording the client
a right to a fair hearing.
Below, Washington argues that a WAC prohibition on
allocating income to
the needs of non-cooperating persons
did not apply here, because
non-cooperation was never
established. However, as we have seen, the
absence of a
formal determination of non-cooperation was due only to
the
fact that Washington never completed the process that
its policies
required.
The Panel is also not persuaded by Washington's argument
that the mother
was not required to cooperate because she
was not an applicant or recipient
of AFDC. We first note
that under the federal regulations, an
"applicant" is a
person who has made application for public assistance
from the agency administering the program. 45 C.F.R.
� 206.10(b)(1). The regulations further provide that:
Application is the action by which an
individual indicates in
writing to the agency
administering public assistance . . . his
desire
to receive assistance. The relative
with whom a child is living will
ordinarily
make application for the child for AFDC.
45 C.F.R. � 206.10(b)(2).
In this case, the mother was the relative with whom the
child was living,
who "will ordinarily make application
for the child for AFDC." Since
she made application for
assistance, she was thus an applicant under section
206.10(b)(1). Washington has not suggested that some
other
individual, such as a guardian ad litem, acted as
the child's representative
in making the application, or
that the child applied for assistance
independently.
Thus, we find that the mother was an "applicant" for
the
purposes of provisions requiring cooperation with support
enforcement efforts.
Washington also asserted that the mother cooperated at
the time of the
application for assistance, that she is
currently cooperating, and that a
paternity order was
obtained in December 1992. This assertion of
cooperation
is contradicted by the entries in the CSO case record
showing that OSE forwarded recommendations that a finding
of
non-cooperation be made in March and July 1992, before
and after the review
month. Her subsequent cooperation
with support enforcement efforts
thus occurred well after
the review month and has no bearing on this
appeal.
Accordingly, we conclude that the mother failed to
cooperate with support
enforcement efforts and was
subject to sanction under Washington's AFDC
procedures.
3/
2. The disregard of income attributable to needs should
not have
been applied.
The parties agreed that the mother was disqualified from
receiving AFDC
by virtue of her alien status under the
Immigration Reform and Control Act
of 1986, and that, as
such, her income was to be considered available to the
assistance unit under the stepparent deeming formula.
4/
WAC � 388-28-560(2) clearly provides that Washington, in
determining the
amount of a stepparent's income that is
available to the assistance unit,
shall not allot any
income to the needs of a stepparent who "fails to
cooperate." Thus, since ACF demonstrated that the alien
mother
failed to cooperate, no income should have been
allocated to her needs.
Washington asserted that this bar in the WAC on allotting
(i.e.,
disregarding) income for the stepparent's needs
did not apply to the alien
mother. Washington asserted
that its AFDC State plan clarifies that
this bar applies
only when the stepparent's (i.e., the alien's)
ineligibility is due solely to non-cooperation.
Specifically,
Washington reported that its State plan
provides that:
Those included for allocation are . . . [t]he
parent or stepparent
who is living in the
household and is ineligible to receive
assistance
for reasons other than being in
sanction status or failing to cooperate.
Washington AFDC State Plan, Attachment 2.3-1(1)(c), cited
in Washington
Appeal Request at 2, May 13, 1993.
This State plan provision permits allocation of an
ineligible
stepparent's income (presumably, to meet his
or her needs), where
ineligibility is not due to failure
to cooperate. However, it does not
address the question
of how to treat the income of a stepparent who, in
addition to being ineligible for reasons other than
failure to
cooperate, also fails to cooperate. Nothing
in it prevents Washington
from applying WAC � 388-28-
560(2) and its bar on allocating a portion of the
alien
mother's income to her needs because of her refusal to
cooperate.
When confronting conflicting interpretations of state
plans, the Panel
will generally give greater weight to a
state's interpretation, if it is
reasonably supported by
the language of the provision involved. See,
e.g.,
Nebraska Dept. of Social Services, DAB No. 1187 (1990).
In
this case, however, Washington has not shown that the
WAC and plan
provisions are in conflict, or that its
interpretation is supported by the
plain language of the
plan and regulations.
Washington also asserted that WAC � 388-28-560(2) is
inconsistent with
corresponding portions of the federal
regulations, which take precedence
over State provisions.
Washington argued that the federal stepparent
deeming
formula requires disregarding income attributable to the
stepparent's needs "except for . . . individuals who are
required to be
included in the assistance unit but have
failed to cooperate." 45
C.F.R. � 233.20(a)(3)(xiv).
Washington asserted that this language did
not apply to
the mother because she was excluded from the assistance
unit due to her alien status. 5/
We find this argument unavailing. We note that 45 C.F.R.
�
233.20(a)(3)(xiv)(B) bars applying the disregard for
"sanctioned
individuals" as well as individuals who are
required to be in the assistance
unit but fail to
cooperate. Washington argued that the mother was not
a
sanctioned individual. However, as noted in the previous
portion
of this decision, no sanctions were applied only
because Washington, unaware
of the mother's employment
income, did not carry out the procedures mandated
by the
WAC in cases of non-cooperation with support enforcement
efforts. 6/ Again, Washington should not be able to
benefit from its failure to adhere to the requirements of
its own
regulations and policies. 7/
Washington also asserted that the preamble to 45 C.F.R.
�
233.20(a)(3)(ii)(C) (no income may be allocated to
meet the needs of an
individual who has been sanctioned
or who is required to be included in the
assistance unit
and has failed to cooperate) shows that its intent was to
require that income from a non-cooperating individual be
considered,
even if his needs are excluded; otherwise, an
individual whose income
exceeds his needs could exclude
his income from consideration by
deliberately being
sanctioned. 57 Fed. Reg. 30,137 (July 8,
1992). Here,
Washington argued, the mother could not increase her
income by refusing to cooperate, since she was already
excluded from the
assistance unit due to her alien
status. However, Washington ignores
the fact that she
did indeed increase her grant, by the amount at issue
here, by failing to cooperate in providing complete
information about
her employment and earnings.
Accordingly, we conclude that Washington was required to
apply the
stepparent deeming formula to the mother's
income without applying the
disregard of income
attributable to her needs.
Conclusion
For the reasons discussed above, we sustain ACF's
determination that the
assistance unit received an
overpayment for the review month.
Thomas D. Horvath
Peggy McFadden Elmore
Jeffrey A. Sacks
* * * Footnotes * * *
1. Washington did not provide
copies of the WAC
provisions at issue here, and did not dispute the
accuracy of the WAC portions quoted by
ACF.
2. The client's opportunity
to submit evidence of
cooperation is in addition to the subsequent right to
a
fair hearing once CSO acts to reduce or terminate
benefits.
3. We also note that
the mother failed to
cooperate by not providing complete information about
her
employment income.
4.
During the course of the appeal, the Panel
noted that section 402(f) of the
Act (which provides that
the income of an alien shall be included in
determining
the dependent child's needs according to the stepparent
deeming formula) states that the needs of the alien shall
not be taken
into account in determining the child's
needs. The Panel asked the
parties to address whether
this language barred applying that portion of the
stepparent deeming formula that disregards income
attributable to the
stepparent's needs. The parties
agreed, however, that the disregard
could still be
applied to income attributable to the alien's needs, the
same as would be the case for a stepparent. ACF
explained that
this language from section 402(f) of the
Act means that the child's grant
will not reflect the
needs of the alien in determining eligibility and the
amount of assistance, but that the amount of the alien's
income
available to the child is to be reduced by an
amount to meet the alien's
needs. Further Response of
ACF at 1-2, July 14,
1993.
5. We do not concur with
ACF's position that the
mother was a person who was required to be included
in
the assistance unit by virtue of her being a parent. Our
conclusion is supported by the following:
o The requirement that certain people (specifically,
the parents and
siblings of a dependent child) be
included in the assistance unit appears at
section
402(a)(38) of the Act. Section 402(f)(2) of the Act
provides that section 402(a)(38) of the Act shall
not apply to
disqualified aliens who are parents of
dependent children.
o The preamble to regulations implementing the Deficit
Reduction Act of 1984 (DEFRA), at 57 Fed. Reg.
30,132 (July 8, 1992),
states that while the parents
of a dependent child must be included in an
application for assistance:
Notwithstanding the preceding, certain
parents and siblings
must be excluded from the
assistance unit because they are not eligible
for assistance due to other provisions of the
Act. For example: .
. . Aliens who fail to
meet the citizenship and alienage requirements
at
� 233.50.
57 Fed. Reg. 30,135.
A subsequent section in the preamble titled "Parents
and Siblings
Who Must Not Be Included in the
Assistance Unit" states that:
Under DEFRA, parents and siblings must
be included in the
assistance unit unless
they are individually ineligible to
receive AFDC
under another provision of
the Act. These are individuals whose
ineligibility is based on a specific
statutory provision regarding an
individual's eligibility which does not
involve a failure to
cooperate. Some
examples of individuals in this group are
the
following:
o Parents and siblings who are
aliens and are ineligible for AFDC
because they do not meet the
citizenship
and alienage requirements at section
402(a)(33) or section
402(f) of the Act
and � 233.50.
57 Fed. Reg. 30,137.
6.
Neither party provided a definition of
"sanctioned individual" as used in
section
233.20(a)(3)(xiv)(B).
7. We also note that 45 C.F.R. �
233.20(a)(3)(xiv)(B) refers to two
classes of persons:
the stepparent, and "other individuals who are
living in
the home" with the stepparent. To the extent that the
prohibitions in this section address these other
individuals and not the
stepparent, we conclude that
Washington was bound to apply the more specific
instructions of the WAC.
(..continued)