Department of Health and Human Services
Departmental Appeals Board
AFDC QUALITY CONTROL REVIEW PANEL
SUBJECT: Connecticut
Department of Social Services
Docket No. A-95-29
Decision No. QC77
DATE: February 10, 1995
DECISION
The Connecticut Department of Social Services
(Connecticut) appealed the
October 21, 1994 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 received a
$40
overpayment during the review month of March 1994 (State
QC Review
No. 660617).
The issue in this case is whether the assistance unit
(AU) was eligible
for payment of a special needs
allowance authorized by Connecticut's AFDC
state plan for
AUs whose rent exceeds one-half their income. Because
the AU here did not apply for assistance until the
seventh day of the
review month, Connecticut prorated its
basic needs payment to the date of
the application, as
required by federal law. Connecticut then compared
the
AU's prorated basic needs payment with its monthly rent.
Because the rent exceeded one-half the AU's prorated
basic needs
payment, Connecticut awarded the AU a
prorated special needs
allowance. ACF asserted that
Connecticut should have determined
whether the AU
qualified for the special needs allowance based on the
full month's basic needs payment. ACF determined that
the AU
received an overpayment in the amount of the
prorated special needs
allowance because the AU's rent
was less than half a full month's basic
needs allowance.
For the reasons explained below, we sustain ACF's
determination.
Legal Background
Title IV-A of the Social Security Act (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 payments to meet the needs of
the relative with whom any dependent child is living.
The QC regulations and the ACF QC Manual (QCM) provide
that the basis for
judging the correctness of eligibility
and payment determinations is
permissible state practice,
defined as written rules and policies that are
in
accordance with existing, approved AFDC state plan
provisions.
If permissible state practice is
inconsistent with the state plan, the
review is conducted
against the state plan. QCM �� 3020, 3131; 42
C.F.R.
�� 205.40(b)(12), 205.42(b).
Connecticut's AFDC state plan and its Uniform Policy
Manual both provide
for the payment of a $50 special
needs allowance for AUs with excessive
housing costs:
This special needs item is available to
assistance units whose
shelter costs are
greater than or equal to fifty percent of the
total of
their counted income plus their
payment for basic needs.
Connecticut AFDC Plan, Attachment 2.3A, Page 7(i);
Connecticut Uniform
Policy Manual � 4515.60. ACF
Exhibits (Exs.) 3, 5. The "payment
for basic needs"
referred to in this section is the basic needs standard
minus applied income. Id. The basic standard of need is
a
level of assistance which varies based on location and
family size.
Since the AU here had no income, it would
be eligible to receive the entire
basic standard of need,
prorated as described below. 1/
States that choose to pay AFDC benefits for the month in
which families
apply for assistance are required to
prorate such benefits. Section
402(a)(10)(B) of the Act.
The AFDC regulations, at 45 C.F.R. �
206.10(a)(6)(D),
require that the assistance payment in the first month of
eligibility for assistance be prorated as follows:
In AFDC, States that pay for the month of
application must prorate
the payment for that
month by multiplying the amount payable if
payment
were made for the entire month
including special needs in accordance
with
� 233.34 by the ratio of the days in the
month including and following the date of
application (or, at State
option, the date of
authorization of payment) to the total number
of
days in such month. 2/
Connecticut's Uniform Policy Manual incorporates the
federal requirement
that payments in the initial month of
eligibility be prorated as
follows:
1. Benefits are prorated when the assistance
unit becomes
eligible to receive benefits on
any day after the first day of the
month.
2. Payment is issued for a prorated share of
needs which exist
from the initial day of
eligibility through the last day of the
month.
3. The reduced amount of payment is calculated
by prorating
the full amount of benefits
which would have been paid if the unit was
eligible for the entire month.
* * * *
Connecticut Uniform Policy Manual, � 6020.05(A); ACF Ex.
7.
The procedures implementing � 6020.05(A) provide that the
first step in
determining the adjusted amount of benefits
is to "calculate the assistance
unit's total benefits as
though they were eligible for the entire payment
month."
Connecticut Uniform Policy Manual, � P-6020.05; Id.
Case Background
The AU consisted of the recipient and her three children;
she applied for
assistance on March 7, 1994 and was found
eligible as of that date.
Under Connecticut's AFDC plan,
a family of four with no income residing in
the same area
of the state as the AU was entitled to a monthly payment
for basic needs of $683. The parties agreed that
prorating that
amount to the date of the application
yielded a $546 payment for the review
month. Since the
AU's $300 rent for the review month was more than
one-
half the prorated $546 payment, Connecticut awarded the
$50 special
needs allowance, which it prorated to $40.
ACF determined that the AU
was not entitled to the
special needs allowance since its rent was less than
one-
half the full monthly payment of $683, and found that the
AU had
thus received a $40 overpayment.
Connecticut argued that ACF erred by looking at the full
month's payment
for basic needs to determine if the AU
qualified for the special needs
allowance, because the AU
did not receive the full payment in its initial
month of
eligibility. Connecticut stated that it prorated the
AU's
assistance payment in accordance with the federal
regulation, and argued
that the prorated amount which the
AU actually received should be compared
to the AU's rent
to determine if it qualified for the special needs
allowance. Connecticut asserted that its intention is to
compute
eligibility for the special needs allowance on
the basis of actual income
only, not AFDC monies which
the AU does not actually receive.
In support of its position, Connecticut provided a
memorandum from a
Public Assistance Consultant on its
Family Support Team, dated November 14,
1994:
How do you determine the eligibility for the
$50 excess rent
payment in the first month of
AFDC eligibility? Do you compare the
prorated
AFDC payment to the rent? OR do you compare
the full
month's benefit, prior to proration,
to the rent?
Answer: The actual income received in the
month is used to
determine eligibility for the
excess rent special need item. This
means the
prorated income is used, not the full payment
standard.
Analysis
QC review is conducted against permissible state
practice, defined as
written rules and policies that are
in accordance with existing, approved
AFDC state plan
provisions. QCM �� 3020, 3131. Here, Connecticut
failed
to show that its award of the prorated special needs
allowance
was consistent with its written rules and
policies existing as of the review
month. Accordingly,
we find that Connecticut failed to apply a
permissible
state practice, and we sustain ACF's determination.
Connecticut's Uniform Policy Manual states that the
assistance payment in
the initial month of eligibility is
determined by prorating "the full amount
of benefits
which would have been paid if the unit was eligible for
the
entire month." The procedures portion of the Uniform
Policy Manual
then states that the first step in this
process is to "calculate the
assistance unit's total
benefits as though they were eligible for the entire
payment month." Connecticut Uniform Policy Manual,
�� 6020.05(A),
P-6020.05. Thus, to determine payment in
the initial month of
eligibility, Connecticut's manual
provisions appear to direct its
eligibility worker to
first calculate the "full amount of benefits" that
would
have been paid had the AU been eligible for the entire
month. Here, there is no dispute that if the AU had been
eligible
for the entire month, its full amount of
benefits would not have included
the special needs
allowance. Accordingly, under the practice described
in
Connecticut's Uniform Policy Manual, the prorated special
needs
allowance should not have been part of the AU's
assistance payment for the
review month.
Instead of prorating the full amount of benefits the AU
would have
received for the entire month, Connecticut
prorated the payment for basic
needs only and then
awarded a prorated special needs allowance based on the
reduced basic needs payment. However, Connecticut's plan
and
policy do not support such a two-step proration
process. Instead, the
policy calls for proration to be
applied only once, to the full amount of
benefits that
the AU would have received if it had been eligible for
the
entire month. Connecticut did not argue or show that
this "full amount
of benefits" should not include
whatever special needs allowance an AU might
qualify for
if eligible for an entire month. Therefore, prorating
the basic needs payment before determining the full
amount of benefits
the AU would have received for the
entire month was not in accord with its
own state
practice. QCM � 3131.
Connecticut offered no persuasive evidence or arguments
to rebut this
interpretation of its manual provisions.
Connecticut cited only
section 4515.60 of the Uniform
Policy Manual, which describes the special
needs
allowance, but never explained how this provision
supported its
construction of the budgeting process.
Connecticut did not address the
language in section
6020.05 discussing proration of benefits in the initial
month of eligibility. 3/
Connecticut also provided no relevant evidence (such as
instructions for
eligibility workers or benefit
calculation worksheets) showing that its
written policy
was to base the special needs allowance on the prorated
basic needs payment in the initial month of eligibility.
Connecticut did
not show that the November 14, 1994
memorandum from its Public Assistance
Consultant was part
of its written rules and policies, as required for
permissible state practice, as of the March 1994 review
month. QCM
� 3131. The memorandum also failed to
address the Uniform Policy
Manual's proration
instructions.
Even accepting Connecticut's argument that the special
needs
determination should be based on the prorated
payment for basic needs,
Connecticut failed to address
the apparent requirement in its Uniform Policy
Manual
that an AU's rent prior to the date of the application
not be
considered in determining an award of assistance.
The Uniform Policy
Manual states that payment is issued
for a prorated share of needs which
exist from the
initial day of eligibility through the last day of the
month. Connecticut Uniform Policy Manual,
� 6020.05(A)(2).
By comparing the AU's $586 prorated
basic needs payment to its $300 rent for
the entire
review month, Connecticut was considering needs which
existed
prior to the initial day of eligibility. As ACF
pointed out, prorating
the rent as of the date of the
application would have resulted in a prorated
shelter
cost of $240, less than one-half the prorated assistance
payment, and too low for the AU to have qualified for the
special needs
allowance.
Conclusion
For the reasons discussed above, we sustain ACF's
determination that the
assistance unit received an
overpayment for the review month.
Sara Anderson
Andrea M. Selzer
Jeffrey A. Sacks
* * * Footnotes * * *
1. In January 1994,
Connecticut raised the
basic standard of need and began paying only a
percentage
of that standard. ACF indicated that these changes had
not been fully implemented by the time of the review
month, and that the
AU here, which had no income, had
been paid the full basic standard of need
under the older
method. However, since the AU would have received the
same basic needs payment under either method, these
changes are not
relevant to our analysis of this case.
2. 45 C.F.R. � 233.34 addresses budgeting
methods in the
initial month of eligibility. It is not
at issue
here.
3. Connecticut
also did not respond to ACF's
arguments concerning the effect of the federal
statutory
requirement that assistance benefits be prorated in the
initial month of eligibility. Section 402(a)(10)(B) of
the
Act. Since we conclude that Connecticut did not
follow its own written
practices, we do not reach the
issue of whether the budgeting process it
used in this
case is permissible under federal law.
(..continued)