ParaRegs-Food-Stamps-Corrective-Actions
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295 Overissuances
/ Tax intercepts 296 Overissuances
/ Demand for repayment / Coupon allotment reduction |
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Code |
Effective |
ParaReg
Text |
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There
are three types of overissuance claims: (1) inadvertent household error claims;
(2) administrative error claims; and (3) intentional program violation
claims. (§63-801.2) |
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290-1A |
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Federal
regulations differentiate between intentional program violation (IPV),
inadvertent household error (IHE) and administrative error (AE) claims as
follows: 1. An IPV claim is any claim for an
overpayment or trafficking resulting from an individual committing an
IPV. An IPV is defined in 7 Code of
Federal Regulations (CFR) §273.16. 2. An IHE claim is any claim for an
overpayment resulting from a misunderstanding or unintended error on the part
of the household. 3. An AE claim is any claim for an
overpayment caused by an action or failure to take action by the State
agency. The only exception is an
overpayment caused by a household transacting an untampered expired
Authorization to Participate (ATP) card. (7 CFR §273.18(b)) |
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290-1B |
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State
regulations define an "Administrative (Agency) Error" as "an
overpayment [sic] claim caused by an action or a failure to take action by
the county agency. (§63-102(a)(3), effective |
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290-1C |
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State
regulations define an "Inadvertent Household Error (IHE)" as
"any claim for an [FS] overpayment resulting from an unintentional error
on the part of the household." (§63-102(i)(5), effective |
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290-1D |
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State
regulations have established a "delinquent claim". That is either
an FS claim which has not been paid by the due date and no satisfactory
payment arrangement has been made, or the payment arrangement has been made
and a scheduled payment has not been made by the due date. (§63-102(d)(3),
effective |
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290-1E |
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State
regulations have established an FS "recipient claim", which is
"an amount owed because benefits were overissued or benefits were trafficked."
(§63-102(r)(1), effective |
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290-3 |
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In Saldivar v. McMahon, the federal district court ordered the CDSS to provide
timely notice of adverse action prior to reducing or terminating benefits,
regardless when the monthly income report is submitted. As part
of the implementation of the court order, the CDSS notified the counties that
when a monthly income report was filed late or incomplete, and the recipient
submitted a complete CA 7 by the extended filing date, the counties “must not
establish a claim against the [Food Stamp] household as long as a complete CA
7 is submitted by the extended filing date.” (Saldivar v. |
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Generally,
the county shall restore to the household benefits which were lost whenever
the loss was caused by an administrative error. (§63-802.1) |
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291-2 |
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If a
claim against the household is unpaid, suspended, or terminated as provided
in §63-801.5, the amount to be restored shall be offset against the amount
due on the claim before the balance, if any, is restored to the household. This
offset shall not be applied against an initial allotment, even if the initial
allotment is paid retroactively. (§63-802.54) |
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291-3 |
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An
underissuance is the amount by which the allotment which the FS household was
entitled to receive exceeds the allotment which the household received.
(§63-102(u)(1)) |
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291-4 |
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Vendor
payments for child care made by the CalWORKs program or by the California
Department of Education are not considered income to the household and cannot
be used as a child care deduction. An
expense which is covered (i.e., either already paid and reimbursed, or
anticipated to be reimbursed) by an excludable reimbursement payment or
vendor payment (§63-502.2(b)(2)) is not a deductible expense. However, if the
child care payment is not reimbursed, or reimbursed only in part, the
out-of-pocket expense is deductible per §§63-502.34 and 63-1101.2, up to the
allowable maximum. Counties must recalculate the FS allotment and issue any
applicable benefit supplement in the current month, or restore lost benefits. (All-County
Letter No. 98-19, March 17, 1998) |
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291-5 |
ADDED
2/04 |
If
the county determines that the assistance unit/household received an
underpayment/underissuance due to county error, the county must take action
to restore those benefits. Restoration
is based on QR rules. The county may
not use actual verified income to reconcile against prospectively budgeted
income that was used in the benefit calculation as income that was
“reasonably anticipated” at the time benefits were calculated. As an example, in
CalWORKs an underpayment should be provided for an assistance unit for any
pregnant/parenting teen who had previously been aided as a dependent child
and who had a break in aid between being aided in their parent/caretaker
relative’s assistance unit and establishing her own assistance unit.
(All-County Letter No. 03-18, |
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291-5A |
ADDED
2/04 |
No
overpayment/overissuance or underpayment/underissuance shall be assessed when
actual income received during the quarter differs from the amount of income
reasonably anticipated, as long as the recipient met his/her reporting
responsibilities. No reconciling based
on actual income is done if reporting requirements are met accurately and
completely and the county averaged and issued benefits based on reasonably
anticipated income. Reconciling
beginning months of CalWORKs to determine the correct grant amount does not
apply in QR/PB rules. (All-County
Letter No. 03-18, |
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The
general rule is that the county is required to establish a claim against any
household that has received more benefits than it was entitled to receive.
All adult household members are jointly and individually liable for any
overissuance to the household. (§63-801.1) |
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292-1A |
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No
claim shall be established against a household for an administrative error
overissuance which is $35 or less; or when the county failed to ensure that
the household signed the application form, completed a current work
registration form, or was certified in the correct county; or when the
household transacted an unaltered expired authorization document.
(§63-801.12; 7 Code of Federal Regulations §273.18(b)(3)) |
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292-1B |
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Federal
regulations provide that "each person who was an adult member
[emphasis added] of the household when the overpayment or trafficking
occurred" is responsible for paying back an FS overissuance. Other
persons who must repay an overissuance are the sponsor of an alien household
member if the sponsor is at fault, or a person connected to the household
(such as an authorized representative) who actually trafficks, or causes an
overissuance. (7 Code of Federal Regulations (CFR §273.18(a)(4), as revised
effective In |
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292-1C |
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Federal
regulations provide that "each person who was an adult member of the
household when the overpayment or trafficking occurred" is responsible
for paying back an FS overissuance.
Other persons who must repay an overissuance are the sponsor of an
alien household member if the sponsor is at fault, or a person connected to
the household (such as an authorized representative) who actually trafficks,
or causes an overissuance. (7 Code of
Federal Regulations (CFR §273.18(a)(4), as revised effective The
following persons are not eligible to participate as a member of any FS
household. (1) Ineligible aliens and students in 7
CFR §§273.4 and .5. (2) SSI recipients in (3) Individuals disqualified with the work
requirements of 7 CFR §273.7. (4) Individuals against whom a sanction
was imposed for failure to comply with a workfare requirement, as set forth
in 7 CFR §273.22. (5) Individuals disqualified for failure
to provide a Social Security Number, as set forth in 7 CFR §273.6. (6) Individuals disqualified for an
Intentional Program Violation under 7 CFR §273.16. (7) Residents of certain institutions. (7 CFR
§273.1(a)(7)) |
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292-1D |
ADDED
5/05 |
QUESTION: Can the county collect from any adult member present in the household
at the time of an overissuance, including adult children, but not collect
from children who leave the case and establish their own household? ANSWER: Yes. All adult household members, including children who are adults in
the household,are liable for any overissuances (O/I) which occurred while
they were in the household. Per MPP Section 63-801.1, a claim for an O/I is applied against any
household that has received more food stamp benefits than it is entitled to
receive or to any household which contains an adult member who was an adult
member of another household that received more food stamp benefits than it
was entitled to receive. While minor children are not liable for O/Is, if the
household consists of all minors, a collection action can be initiated
against a household whose only eligible members are minors (ACL 91-53). If a
minor leaves an “all minor” household, that minor is not liable for the
overissuance. (All
County Information Notice I-16-05, p.11, |
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292-2 |
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An
overissuance is the amount by which coupons issued to a household exceed the
amount the household was eligible to receive. (§63-102(o)(1)) |
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292-3 |
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After
calculating the amount of the inadvertent household or administrative error
claim, the county shall offset the amount of the claim against any amounts
which have not yet been issued to the household as a restoration of lost
benefits in accordance with §63-802.54. The county shall then initiate
collection action for the remaining balance, if any. (§63-801.313) Counties
had been instructed not to collect administrative error overissuances by
balancing or offsetting them against underissuances by All-County Letters
(ACLs) No. 96-43, |
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292-4 |
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When an
individual has intentionally failed to report earned income, as determined by
an administrative disqualification hearing (ADH), a court of appropriate
jurisdiction, or by having signed an ADH waiver or a disqualification consent
agreement, then the county shall not apply the 20% earned income deduction to
that unreported income. (§63-801.323, effective |
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292-5B |
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When
an FS household received a larger allotment than it was entitled to receive,
the county shall establish a claim against the household equal to the
difference between the benefits received and the benefits which should have
been issued. (a) For categorically eligible households,
a claim shall be determined only when the amount of the overissuance can be
calculated on the basis of the household's net income and/or household size. (b) When the overissuance occurred in a
month or two months in which any household member has already performed a
Workfare or work component requirement, see §63-407.89. (c) When determining the amount of
benefits the household should have received, the county shall not apply the
20% earned income deduction to that portion of earned income the household
failed to report. (§63-801.312,
as amended by adding (c), effective State regulations
provide that §63-801.312 shall be implemented effective upon filing with the
Secretary of State (November 12, 1996) for all new applicants, or at the next
recertification, but no later than August 22, 1997, for all FS applicants or
recipients. (§63-1434.3) |
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292-5D |
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For
purposes of §63-801.312(c), the overissuance computation which disallows the
20% earned income deduction for "...earned income the household failed
to report," the FS policy interpretation is that the disallowance is to
be applied only to that portion of the earnings which is not reported by the
extended filing date; and that no "good cause" provision which
would permit the deduction if the earnings are not reported. (All-County
Information Notice (ACIN) No. I-62-96, State
regulations provide that §63-801.312 shall be implemented effective upon
filing with the Secretary of State ( |
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292-6 |
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A claim shall be
handled as an administrative error claim if the overissuance was caused by
the action or inaction of any county welfare department (CWD). These claims only apply to categorically
eligible households when the calculation of the claim is based on incorrect
net income or household size.
(§63-801.221) |
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292-7 |
ADDED
2/04 |
In
the QR/PB system, a CalWORKs overpayment will be established as applicable
based on: ·
Recipient failure to report accurately and completely; ·
County error; ·
Recipient late reporting; and ·
County inability to issue the correct grant amount due
to the 10-day notice requirement when the recipient reported timely,
completely and accurately. Late
reporting applies to both a late submission of the QR 7 and to late mandatory
mid-quarter reports. The county will
establish an overpayment when the recipient received a grant amount to which
he/she was not entitled under QR/PB rules regardless of whether the recipient
reported timely. (ACL 03-18, In
the food stamp program, an overissuance will be established if the household
received an allotment greater than the amount it was entitled to receive
under QR/PB rules and was due to recipient failure to report accurately or
due to county error. If the recipient
reports a mid-quarter change that is required to be reported timely,
completely and accurately, the county shall not establish an overissuance due
to the 10-day notice requirement. An
overissuance will be assessed when late reporting alone or together with the
10-day notice requirement delayed issuance of the correct amount. An overissuance will be established when a
recipient submits a late QR 7 which results in the recipient receiving more
food stamps than he/she was entitled to receive because the county could not
reduce the food stamps without giving 10-day notice. (ACL 03-18, |
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292-7A |
ADDED
2/04 |
If
a recipient fails to report income any time he/she is required to report, or
the county fails to act correctly when a recipient reports income, the county
shall determine benefits the recipient would have received based on an
accurate report of income and correct county action on that report. The overpayment/overissuance begins on the
first date the change would have been made based on an accurate recipient
report. Example: The assistance unit/household has income
that exceeded the IRT since Example: The assistance unit/household submits a QR
7 on March 5 and reports that dad started a job on February 10 and that the
income is expected to continue. The
income does not exceed the IRT. The
county fails to consider the income in issuing the CalWORKs grant and food
stamp allotment beginning in April. If
the increased income should have resulted in lower benefits, the county must
establish an overpayment/overissuance beginning in April. (All-County
Letter No. 03-18, |
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292-7B |
ADDED
2/04 |
Changes
that are not required to be reported, but that may voluntarily be reported should
not be considered when determining whether there is an
overpayment/overissuance. Voluntary
changes need only be reported on the QR 7 that follows the change. Example: Dad moves back into an assistance unit on
January 16. He is employed full time.
The assistance unit submits a QR 7 in March for the February report month,
but does not report this change on the QR 7 or at any other time. The county discovers in December that dad
has been in the home since January.
Because there is no deprivation the assistance unit is not eligible
for CalWORKs. However, the assistance
unit was not required to report dad in the home until it completed the QR 7
in March for the February report month.
The first month of overpayment is April. Example: A recipient assigned to the January-March
quarter correctly reports on the QR 7 due in March that the assistance
unit/household has not acquired new property since the last QR 7. In April the recipient wins a car but sells
it for fair market value in May and spends the money on bills. The recipient reports these facts on the QR
7 due in June. Since the assistance
unit/household is property eligible in July-September quarter based on the
June QR 7 and was not required to report the property mid-quarter, the county
does not establish a property overpayment/overissuance for April-June.
(All-County Letter No. 03-18, |
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292-7C |
ADDED
2/04 |
In
the QR/PB system, the only time an assistance unit /household is required to
report property is on the QR 7. Property
related overpayments/overissuances will be determined based on information
that should have been reported on the QR 7.
An assistance unit/household is only required to report property when
property exceeds the limit in the second month of the quarter (i.e., the QR
Data Month). If
a recipient owned property that exceeded the resource limit in the second
month of the quarter and failed to report it on the QR 7, or if the county
failed to act correctly on a report of property that exceeds the limit, the
county shall determine the benefits the assistance unit/household should have
received. (All-County Letter No.
03-18, |
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292-7D |
ADDED
2/04 |
No
overpayment/overissuance or underpayment/underissuance shall be assessed when
actual income received during the quarter differs from the amount of income
reasonably anticipated, as long as the recipient met his/her reporting
responsibilities. No reconciling based
on actual income is done if reporting requirements are met accurately and
completely and the county averaged and issued benefits based on reasonably
anticipated income. Reconciling
beginning months of CalWORKs to determine the correct grant amount does not
apply in QR/PB rules. (All-County
Letter No. 03-18, |
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292-7E |
ADDED
8/04 |
For
QR households, a claim shall be established when the household fails to
report a change on the QR 7 for the appropriate QR Data Month and the QR
Payment Quarter was incorrectly computed based on the failure of the
recipient to report a change or a timely QR 7 was not submitted. (§63-801.311(c)) |
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292-7F |
ADDED
8/04 |
Under QR/PB rules, an overissuance will be established
following the late submission of a
QR7 when the county is unable to decrease benefits due to the 10-day noticing
provisions. (§§63-508.623 (Handbook)) |
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292-7G |
ADDED
5/05 |
When
calculating an overissuance claim, is the PA amount (CalWORKs) that was
actually issued and that could have been “reasonably anticipated” at the time
of issuance used, or is the recalculated CalWORKs grant amount used? ACL
03-18, page 57, states, “The FSP will use the recalculated CalWORKs grant to
redetermine the FS allotment”. However, the emergency regulations and the old
regulations regarding benefit determination state that to use the amount that
can be anticipated with reasonable certainty or can be reasonably
anticipated. |