Page 217

under regulations of the department, to be physically or mentally unable to perform gainful activity or to be providing care for a child who is experiencing a disability that requires 24-hour care, as certified by a physician or other licensed medical professional. However, if the commissioner determines that temporary economic conditions have resulted in decreased employment opportunities during those months and a reduction in cash assistance would impose an undue hardship on a family, the department may waive application of this subsection with respect to that family. (d) The department shall reduce cash assistance under this section to the extent that the family's shelter costs are lower than the standard shelter allowance used by the department for similar families. The shelter allowance for a family whose costs are below the standard allowance shall be an amount equal to the family's actual verified shelter costs. In this subsection, (1) “shelter allowance” means the portion of the cash assistance provided under this section that is allocated by the department for shelter costs; (2) “shelter costs” means (A) rental payments or mortgage payments for the family's housing, including payments made for property or mortgage insurance and property taxes; and (B) the cost of utilities, including heat, electricity, basic telephone service, water, sewer, and garbage services incurred for the family's housing; the department may establish different utility cost standards for different areas of the state and may use an average utility cost per month based on estimated level payments over a 12-month period. (e) The department may, instead of paying all of the cash assistance to a family under this section, use all or part of the cash assistance as a wage subsidy paid to an employer who employs a person in the family at a wage that is higher than the wage subsidy. If authorized under AS 47.25.975(b), the department may, instead of paying all of a family's food stamp allotment under AS 47.25.975 — 47.25.990 in a form restricted to buying food, use all or part of the value of the family's food stamp allotment as a wage subsidy paid to an employer who employs a person in the family at a wage that is higher than the total of the wage subsidies paid under this subsection for employment of the person. A subsidy under this subsection may not exceed one year in duration. Sec. 47.27.026. Diversion payments. (a) The department may offer a lump-sum diversion payment in place of ongoing cash assistance to an adult applicant who applies under AS 47.27.020 if the adult applicant is job ready and is determined to need only short-term financial assistance and self-sufficiency services to meet critical needs in order to secure employment and support for the adult applicant's family. The department shall set standards and conditions for diversion payments and self-sufficiency services by regulation. (b) The department may pay a diversion payment to an applicant's family only if that family appears to be eligible for cash assistance under AS 47.27.020 and to include a job-ready individual based on the information provided to the department in the application completed under AS 47.27.020. The department may offer to an applicant with the potential to participate in the diversion project a choice between (1) having the Alaska temporary assistance program application processed under AS 47.27.020 and the regulations adopted by the department; or (2) having the application referred to the diversion project of the Alaska temporary assistance