Department of Health and Human Services
Departmental Appeals Board
AFDC QUALITY CONTROL REVIEW PANEL
SUBJECT: New Jersey Department of Human Services
Docket No. A-92-121
DATE: September 30, 1992
DECISION
The New Jersey Department of Human Services (State) appealed the March 19, 1992 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) recipient was overpaid for the review month of March, 1991. ACF determined that the needs of the minor child's father should not have been included in determining the amount of assistance because his paternity was not legally established as of the review date. For the reasons discussed below, we reverse ACF's determination.
Background
The assistance unit (AU) was comprised of the AFDC recipient, her minor child and the child's father (initials D.L.). AFDC eligibility was based on the father's unemployment as the principal wage earner, and the AU was issued a $424 AFDC payment for the review month of March, 1991, with the father's needs included in the grant. The federal QC review found that a copy of a court order in the case file adjudicating the father's paternity was dated June 26, 1991. ACF asserted that since D.L. had not been adjudicated as the child's father as of the review date, he was not eligible to be included in the AU. Consequently, ACF asserted, the AU had been overpaid as D.L.'s needs should not have been considered in determining the grant.
ACF stated that its policy is that an individual without legal responsibility must be treated as an absent parent. 45 C.F.R. § 233.90; Social Security Administration (SSA) Action Transmittal (AT) 81-10. ACF argued that by designating D.L. as the unemployed father in March, 1991, despite the fact that he had not been adjudicated as the father at that time, the State violated the policy announced in King v. Smith, 392 U.S. 309, 88 S.Ct. 2128 (1968). ACF noted that the Court held that a "man in the house" not legally obligated to support a child cannot be presumed to be the father for AFDC purposes. ACF also asserted that, in an earlier case, New Jersey had acknowledged that only a court could decide paternity. ACF Ex. 1. ACF also noted that its child support regulations require states to have procedures for the establishment of paternity and assignment of rights to support for minor children born out of wedlock.
The State agreed that paternity had not been adjudicated as of the QC review date, but noted that D.L. was, in fact, later determined to be the father. The State argued that it should be permitted to establish paternity retroactively, and asserted that its practice has been to accept a local agency's determination of paternity if a subsequent adjudication occurs. The State noted that ACF permits retroactive determinations of paternity for the purpose of meeting the requirement that a child be living with a specified relative, as well as retroactive determinations of incapacity. The State noted that if D.L. is the natural parent, he must have been the natural parent since the time of conception.
The QC Review Panel invited the parties to comment on its proposed analysis that, under New Jersey law, paternity of a minor child born out of wedlock need not be established by court adjudication for the father to be included in the child's AU. The Panel noted that the New Jersey Parentage Act provides evidentiary presumptions for the establishment of paternity. The Panel asked the State to explain the basis of the original decision of its eligibility workers to designate D.L. as the father, and to provide any evidence utilized in making this determination. The State reported that its local agency case file did not contain any documentation concerning the original determination of paternity.
ACF disagreed with our analysis, and asserted that New Jersey law provides for establishment of paternity only by or with the approval of a court. ACF argued that McBride v. Heckler, 619 F. Supp. 1554 (D. N.J. 1985), which the Panel cited in its proposed analysis, was inapplicable, as it dealt solely with establishment of status as a child for purposes of survivor's benefits under Title II of the Social Security Act (Act), which permits non-judicial applications of state law standards.
Analysis
The issue of whether State eligibility workers may determine paternity by applying the evidentiary presumptions in the New Jersey Parentage Act was rendered moot by New Jersey's failure to provide any information as to the basis of the original decision to classify D.L. as the father. Even assuming arguendo that the State could have applied the Parentage Act, it was unable to show that any of the evidentiary presumptions of paternity were satisfied.
We are thus faced with the question of whether the State committed a QC error by classifying as the child's father the man who was, it is not contested, the child's father. We decline to find a QC error in this situation. Our decision is based on the fact that the State made what was ultimately a correct determination. We also find that the policy provisions and the holding in King v. Smith cited by ACF do not apply where the man that the State regarded as the father actually is the father.
a. The State's determination was not erroneous.
Section 408(m)(6) of the Social Security Act (Act) defines erroneous payments for QC purposes as including the sum of overpayments to eligible families. The QC review independently establishes and verifies the facts about each element of eligibility for each case for the review month. The review establishes whether the case was, in fact, eligible and whether the proper amount was authorized. QCM § 3020. Payment status is determined as of the review date. QCM § 3030.
ACF did not dispute that D.L. is the father of the minor child and must have been the father as of the review date. As D.L. was, in fact, the child's father, we find that the State's classification was correct, and that the AU was eligible in fact for the payment it received based on D.L.'s uncontested status as the father of the minor child. Our decision does not address whether state eligibility workers may make paternity determinations, but is based on the fact that the man classified as the father was in fact the father.
We do not agree with ACF that the State committed an error which "caused the _father_ to be put on the AFDC rolls incorrectly." ACF Response to Panel's Request to Develop Record and Opportunity to Comment at 8. The use of quotation marks in referring to D.L. as the minor child's father suggests that ACF does not agree with this characterization. However, ACF did not challenge the adjudication of paternity, and, as the State observed, if D.L. was the father at that time, then he was the father at the time of conception and thus during the review month.
ACF also warned that a finding for the State here could lead to a case where an incorrect designation of someone as a father may remove an eligible child from the rolls illegally. That situation, however, is readily distinguishable, as here the State's designation of D.L. as the father was not incorrect. Moreover, our holding here does not bar ACF from finding an error where the State's designation of the father is erroneous. Similarly, in an earlier QC difference case cited by ACF, where the State protested ACF's initial decision that a man in the AU should have been classified as the father, there was no adjudication of paternity.
b. Provisions cited by ACF do not compel a finding of error.
While not disputing the paternity determination, ACF argued that by classifying D.L. as the father prior to the adjudication of paternity, the State violated ACF's policy that an individual without legal responsibility must be treated as an absent parent. 45 C.F.R. § 233.90, SSA-AT-81-10. Treating a "man in the house" as a father, ACF asserted, was contrary to the Supreme Court's holding in King v. Smith. However, we find that neither ACF's policy nor the Supreme Court decision bear directly on this case.
Section 233.90(a)(1) requires that a determination of parental deprivation be made:
. . . only in relation to the child's natural or adoptive parent, or in relation to the child's stepparent who is married, under State law, to the child's natural or adoptive parent and is legally obligated to support the child under State law of general applicability which requires stepparents to support stepchildren to the same extent that natural or adoptive parents are required to support their children.
Here, the determination of parental deprivation (due to unemployment of the principal wage earner) was made in relation to the child's natural father. Consequently, the State did not violate this regulation. The reference in the regulation to persons having a "legal responsibility" to support the child applies with respect to a step-parent, not a natural father. 1/
Similarly, ACF has not shown that the State has violated the holding of the U.S. Supreme Court in King v. Smith, which struck down an Alabama policy that a man having a relationship with the child's mother (whether or not living with the mother) be considered a "substitute father," thus rendering the household ineligible. The policy had been applied to deny assistance where the mother was having a relationship with a married man who lived with his wife and children in another household. The Court held that the State's policy defined "parent" in a manner inconsistent with the Act. 2/ The Court's decision is reflected at 45 C.F.R. § 233.90(a)(1), cited above, which provides that the inclusion in the family, or the presence in the home, of a "substitute parent" or "man in the house" (other than the natural or adoptive parent, or stepparent with a legal duty to support) is not an acceptable basis for a finding of ineligibility or for assuming the availability of income. The instant case is readily distinguishable, as ACF did not directly dispute that D.L. was the minor child's father. ACF also did not allege that D.L. had been classified as the father pursuant to a State policy that a "man in the house" be treated as legally responsible to support the child.
SSA AT-81-10 is also not directly applicable. AT-81-10 states that in situations where the mother and putative father of a child born out of wedlock are living together with the child, and the man has been determined under acceptable state law criteria to be the father, the state agency will treat this situation as an intact family with both parents present. If the state determines that the man is not the father, eligibility for AFDC is established (assuming the other factors of eligibility are present). It does not, however, address the situation here, where the State has not determined that the man is not the father, and where he is, in fact, the father.
We agree that the State could have properly handled this case by basing eligibility on absence of the father, and initiating an action to establish paternity and compel child support. However, that this might have been a correct procedure does not compel the finding of an error. As we have noted, we decline to find an error where the State's decision that D.L. was the father was factually correct. We do not hold that other courses of action would not have been appropriate as well.
As the State noted, the QCM permits adjudications of paternity to be applied retroactively for purposes of meeting the requirement that a child who is deprived of parental support be "living with" a parent or certain specified relatives. Section 406(a),(c) of the Act. Section 3532 (now section 3533) of the QCM provides that a determination of paternity may be applied retroactively back to the review date. Thus, if a child has no mother and lives with its putative father or with a relative of the putative father, a determination of paternity may be applied retroactively to show that the child was indeed living with its father or a specified relative, thus meeting the "living with" requirement.
ACF argued that Section 3539 (now section 3540) of the QCM, which is applicable to this case, does not provide for retroactive determinations of paternity. 3/ ACF argued that retroactive application of a determination of paternity to meet the "living with" requirement is distinguishable "from the creation of an intact family" based upon the presence of both parents in the household. ACF Response to State' Appeal at 7 - 8. ACF contended that retroactive application of the paternity determination for meeting the living with requirement "preserves" the deprivation requirement or definition, and does not remove it. Id. at 8.
In other words, where a child is living with a putative father or the father's relative, retroactive application of a paternity determination satisfies the "living with" requirement and establishes an element of AFDC eligibility. Conversely, where the child lives with its mother and there is a man in the house, retroactive application of a paternity determination creates an intact family, and destroys one of the grounds for AFDC eligibility, deprivation of parental support. However, in this case, the basis of parental deprivation was unemployment of the principal wage earner, and not continued absence. 4/ Application of the paternity adjudication here did not destroy eligibility, and the policy interest cited by ACF would not be served by barring retroactive application of the paternity adjudication in this particular case.
Conclusion
For the reasons discussed above, we conclude that the State did not commit an error when it classified D.L. as the father of the minor child. Accordingly, we reverse ACF's determination.
Sara Anderson
Maxine Winerman
Jeffrey A. Sacks
* * * Footnotes * * *
1. The New Jersey Parentage Act does not bar a court from ordering an award of child support for the period prior to a determination of paternity. N.J. Stat. Ann. § 9:17-38 et seq. (1983). D.L. could thus be liable for support of the minor child prior to the adjudication of paternity.
2. The Court also noted that the State's policy was contrary to provisions of the Act forbidding states from imposing eligibility conditions that would deny assistance, while the child continues to reside in the home, on the basis that the conditions in the home are unsuitable. That requirement is currently found at 45 C.F.R. § 233.90(b)(1), which provides that a child may not be denied AFDC "_because of the conditions of the home in which the child resides_, or because the home is considered _unsuitable_" unless the State otherwise provides adequate care and assistance for such child.
3. Section 3539 addresses the requirement that a child (who already meets the "living with" requirement) must be deprived of parental support as a result of a parent's death, incapacity, continued absence, or as a result of the unemployment of a parent who is the principal wage earner.
4. With regard to unemployment, the federal QC review noted that D.L. refused to cooperate in determining his income. ACF did not address the propriety of the State's decision to designate D.L. as an unemployed principal wage earner.