63-502 INCOME, EXCLUSIONS AND DEDUCTIONS 63-502

(b) Payments from a roomer or boarder, except foster care boarders as specified in Section 63-402.322 shall also be considered self-employment income.

.133 Training allowances from vocational and rehabilitation programs recognized by federal, state, or local governments, to the extent they are not a reimbursement.

.134 Payments to volunteers under Title I (VISTA) of the Domestic Volunteer Service Act excluding payments made to households specified in Section 63-502.2 who at the time they joined VISTA, were not receiving public assistance or food stamps.

.135 Earnings of individuals who are participating in on-the-job training programs under Section 204(b)(1)(C) or Section 264(c)(1)(A) of the Workforce Investment Act except as specified in Section 63-502.2(i)(1), or Title I of the National and Community Services Act (NCSA) of 1990, except as specified in Sections 63-507(a)(4) and (a)(17)(A). The NCSA includes programs under the Serve America, American Conservation and Youth Corps, and National and Community Service subtitles.

.136 Any portion of strikers' benefits which are received as compensation for picketing.

.137 Work study income which has not been excluded by federal statute, as specified in Section 63-502.2(l)(4), or through application of allowable exclusions as specified in Section 63-502.2(e).

.14 Unearned income shall include, but not be limited to:

.141 Assistance payments from Aid to Families with Dependent Children (AFDC), General Assistance/General Relief (GA/GR), Refugee Cash Assistance (RCA), Entrant Cash Assistance (ECA), or other assistance programs based on need except as specified in Section 63-501.111.

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MANUAL LETTER NO. FS-02-02 Effective 2/21/02

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Regulations ELIGIBILITY DETERMINATIONS 63-502.146

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(a) Such assistance is considered to be unearned income even if provided in the form of a vendor payment (provided to a third party on behalf of the household), unless the vendor payment is specifically exempt from consideration as countable income as specified in Section 63-502.2(b)(2).

(b) Assistance payments from programs which require, as a condition of eligibility, the actual performance of work without compensation other than the assistance payments themselves, shall be considered unearned income, except for special allowances excluded under Section 63-502.2(f)(1).

.142 Annuities, pensions, retirement, veteran's, or disability benefits; worker's or unemployment compensation; old-age, survivors, or social security benefits; strikers' benefits except as specified in Section 63-502.135; foster care payments for children or adults who are members of the food stamp household as specified in Section 63-402.322(b); and any deemed income from a sponsor who has signed an I-864 and/or I-864A paid to a sponsored noncitizen.

.143 Gross income minus the cost of doing business derived from rental property in which a household member is not actively engaged in the management of the property at least an average of 20 hours a week.

.144 Support or alimony payments made directly to the household from nonhousehold members, except as provided in Section 63-502.122.

.145 Scholarships, educational grants, fellowships, deferred payment loans for education, veteran's educational benefits and the like which have not been excluded by federal statute, as specified in Section 63-502.2(l)(4) or through application of allowable exclusions as specified in Section 63-502.2(e).

.146 Payments from government-sponsored programs, dividends, interest, royalties, and all other direct money payment from any source which can be construed to be a gain or benefit.

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63-502.147 ELIGIBILITY DETERMINATIONS Regulations

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

.147 Monies which are withdrawn or dividends which are or could be received by a household from an excluded trust fund [see Section 63-501.3(h)]. Such trust withdrawals shall be considered income in the month received, unless excluded under Section 63-502.2. Dividends which the household has the option of either receiving as income or reinvesting in the trust are to be considered as income in the month they become available to the household unless excluded under Section 63-502.2.

.148 Reimbursements which exceed total expenses or which are intended to cover living expenses, such as food, rent, and clothing.

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MANUAL LETTER NO. FS-95-08 Effective 12/1/95

Page 233.1

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Regulations ELIGIBILITY DETERMINATIONS 63-502.162

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

.149 Monies that are legally obligated and otherwise directly payable to the household, but which are diverted by the provider of the payment to a third party for a household expense shall be counted as income and not excluded as a vendor payment. The distinction is whether the person or organization making the payment on behalf of a household is using funds that otherwise would have to be paid to the household.

(a) This does not apply to payments made to landlords or mortgagees by the Department of Housing and Urban Development (HUD). HUD payments are excluded from income as a vendor payment. Such payments include housing and/or utility payments.

HANDBOOK BEGINS HERE

Such funds include wages earned by a household member and therefore owed to the household, a public assistance grant to which a household is legally entitled, and support or alimony payment in amounts which legally must be paid to a household member. If an employer, agency, or former spouse who owes these funds to a household diverts them instead to a third party to pay for a household expense, these payments shall still be counted as income to the household.

HANDBOOK ENDS HERE

.15 In accordance with Section 63-503.441, the earned or unearned income of the following individuals shall be counted in its entirety as income to the remaining household members.

.151 Individuals excluded from participation for committing intentional Program violations as provided in SDSS' Manual of Policies and Procedures, Division 20, Chapter 20-300.

.152 Individuals sanctioned by a CWD while a participating member of a household disqualified for failure to comply with the CWD's Workfare Program requirements.

.16 The earned or unearned income of the following excluded individuals shall be counted as income to the remaining household members in accordance with Section 63-503.442.

.161 Individuals excluded from households for failing to comply with the SSN requirements in accordance with Section 63-404.4.

.162 Individuals excluded from households for being an ineligible alien in accordance with Section 63-403.2.

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MANUAL LETTER NO. FS-93-03 Effective 11/1/93

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63-502.17 ELIGIBILITY DETERMINATIONS Regulations

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

.17 Income shall also include monies withheld from AFDC and GA/GR grants or other federal, state or local means-tested programs due to the household's failure to comply with that program's requirements. See Section 63-503.5.

.171 For purposes of this section, "means-tested" means that the household's financial circumstances are considered in determining eligibility and/or benefit level, and these means-tested programs make publicly-funded payments to the household.

.18 Net income shall mean gross income minus deductions, as specified in Section 63-502.3 and calculated in accordance with Section 63-503.31.

.2 Income Exclusions. Only the following items shall be excluded from household income:

(a) In-Kind Benefits

(1) Any gain or benefit which is not in the form of money payable directly to the household, including nonmonetary or in-kind benefits, such as, but not limited to meals, clothing, public housing, or produce from a garden.

HANDBOOK BEGINS HERE

(A) For Example:

If the employer provides housing to an employee, the value of the housing shall not be counted as income.

HANDBOOK ENDS HERE

(2) Direct payments received in lieu of in-kind benefits due to the household's participation in a demonstration project authorized under federal law, or demonstration projects created by the waiver of federal provisions.

(b) Vendor payments. Money that is not legally obligated to be paid to the household, but which is paid to a third party for a household expense by a person or organization outside of the household.

(1) Wages earned by a household member that are garnished or diverted by an employer, and paid to a third party for a household's expenses, such as rent, shall be considered as income. However, if the employer pays a household's rent directly to the landlord in addition to paying the household its regular wages, this rent payment shall be excluded as a vendor payment.

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MANUAL LETTER NO. FS-96-04 Effective 11/12/96

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Regulations ELIGIBILITY DETERMINATIONS 63-502.2 (Cont.)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(2) A GA/GR vendor payment shall not be counted as income to the household, except if the payment is for housing or energy assistance. However, any portion of the GA/GR vendor payment for housing or energy assistance that is over and above the normal GA/GR grant would be considered emergency or special assistance, as specified in Sections 63-502.2(b)(2)(E) and 63-502.2(b)(3), and shall be excluded as income.

An AFDC, RCA, or ECA payment shall be considered an excludable vendor payment and not counted as income to the household if that payment is for:

(A) Medical assistance;

(B) Child care assistance;

(C) Housing assistance payments made through a state or local housing authority; or

(D) Emergency assistance provided to a third party on behalf of a migrant or seasonal farmworker household during the period household is in the job stream.

HANDBOOK BEGINS HERE

1. This assistance may include, but is not limited to, emergency vendor payments for housing or transportation.

HANDBOOK ENDS HERE

(E) Emergency or special assistance (as specified in Section 63-502.2(b)(3)).

(F) Energy assistance as follows:

(1) Any payment or allowances made for the purpose of providing energy assistance under any federal law other than Part A of Title IV of the Social Security Act (42 U.S.C. 601 et seq.), including utility reimbursements made by the Department of Housing and Urban Development and the Rural Housing Service, or

(2) A one-time payment or allowance applied for on an as-needed basis and made under a federal or state law for the cost of weatherization or emergency repair as replacement of an unsafe or inoperative furnace or other heating or cooling device.

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63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

HANDBOOK BEGINS HERE

A down payment followed by a final payment upon completion of the work is considered a one-time payment.

HANDBOOK ENDS HERE

(3) All or part of an AFDC, GA/GR, RCA, or ECA grant which would normally be provided in a money payment to the household, but which is diverted to third parties or to a protective payee for purposes such as managing a household's expenses, shall be considered income to the household, except as specified in Section 63-502.2(b)(2). However, any payment by the CWD that would not normally be provided in a money payment to the household, and that is over and above the normal AFDC, GA/GR, RCA, or ECA grant, would be considered emergency or special assistance and shall be excluded as income if it is made directly to a third party for a household expense.

HANDBOOK BEGINS HERE

If it is not clear that a certain type of AFDC, GA/GR, RCA, or ECA vendor payment is covered under this general exclusion policy, the CWD may apply, in writing, through SDSS to the FNS Regional Office for a determination of whether these vendor payments, that the CWD believes are provided for emergency or special circumstances, should be excluded.

HANDBOOK ENDS HERE

(4) Deferred educational loans, grants, scholarships, fellowships, veterans' educational benefits, and the like, are legally obligated to the household and therefore are not vendor payments.

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63-502.2(c) ELIGIBILITY DETERMINATIONS Regulations

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(c) Cash donations received from one or more private, nonprofit charitable organizations of not more than $300 in a calendar quarter i.e. January-March, April-June, July-September, October-December.

HANDBOOK BEGINS HERE

(1) For example, in a calendar quarter January through March, the household received $100 in January, $100 in February and $200 in March, for a total of $400 from two private nonprofit charitable organizations. The $100 in January, $100 in February and $100 of the $200 in March will be excluded for a total of $300 which can be excluded under this provision. The remaining $100 received in March will be counted as income to the household.

HANDBOOK ENDS HERE

(d) Any prospectively budgeted income in the certification period which is received too infrequently or irregularly to be reasonably anticipated, but not in excess of $30 in a quarter.

(e) Educational assistance not otherwise excluded by federal statute as specified in Section 63-507(a)(6), to the extent that it is either earmarked by the lender, used for, or intended to be used for, allowable educational expenses at qualifying institutions as specified in Section 63-502.2(e)(3).

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MANUAL LETTER NO. FS-95-02 Effective 4/3/95

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Regulations ELIGIBILITY DETERMINATIONS 63-502.2(e)(3)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(1) The educational assistance may be in the form of loans on which payment is deferred, grants, scholarships, work study, fellowships, veterans' educational benefits, and the like.

(2) Allowable educational expenses include tuition and mandatory fees (including the rental or purchase of any equipment, materials, and supplies related to the pursuit of the course of study involved), books, supplies, transportation, dependent care, miscellaneous personal expenses (other than living expenses, such as rent or mortgage, personal clothing, or food eaten at home), and origination fees and insurance premiums on student loans.

(3) Qualifying institutions are: those providing secondary or post-secondary education or the equivalent of a secondary diploma, including correspondence schools at these levels; a school at any level for the physically or mentally handicapped; or a vocational education program.

(A) For the purpose of this provision, institution of post-secondary education means any public or private educational institution which: (a) meets the definition of institution of higher education as specified in Section 63-102(i), or (b) admits persons who are beyond the age of compulsory school attendance in the state in which the institution is located. The institution must be legally authorized or recognized by the state to provide: (a) an educational program beyond secondary education in the state, or (b) a program of training to prepare students for gainful employment.

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MANUAL LETTER NO. FS-94-04 Effective 7/1/94

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Regulations ELIGIBILITY DETERMINATIONS 63-502.2(e)(4) (Cont.)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(4) The CWD shall verify all factors affecting Section 63-502.2(e). The student shall be responsible for providing the CWD with information to document:

(A) Amounts claimed for tuition, mandatory fees, books, supplies, transportation, dependent care and miscellaneous personal expenses.

HANDBOOK BEGINS HERE

In order to document claimed costs a student may use, but is not limited to, student budgets, award letters, and/or receipts.

HANDBOOK ENDS HERE

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63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(B) Until such time as appropriate verification is presented to the CWD, any portion of assistance received which is not verified shall not be excluded.

(C) Excludable expenses claimed by the student shall not exceed the value of the total amount of educational assistance received.

(f) All loans, including loans from private individuals as well as commercial institutions, other than educational loans on which repayment is deferred as specified in Section 63-502.2(e).

(g) Reimbursement for past or future expenses, to the extent they do not exceed actual expenses, and do not represent a gain or benefit to the household. Reimbursements for normal household living expenses such as rent or mortgage, personal clothing, or food eaten at home are a gain or benefit and, therefore, are not excluded. To be excluded, these payments must be provided specifically for an identified expense, other than normal living expenses, and used for the purpose intended. When a reimbursement, including a flat allowance, covers multiple expenses, each expense does not have to be separately identified as long as none of the reimbursement covers normal living expenses. The amount by which a reimbursement exceeds the actual incurred expense shall be counted as income. However, reimbursements shall not be considered to exceed actual expenses, unless the provider or the household indicates the amount is excessive.

(1) Excludable reimbursements which are not considered to be a gain or benefit to the household include, but are not limited to the following:

(A) Reimbursements or flat allowances, including reimbursements made to the household as specified in Section 63-407.83, for job- or training-related expenses such as travel, per diem, uniforms and transportation to and from the job or training site. Reimbursements which are provided over and above the basic wages for these expenses are excluded; however, these expenses, if not reimbursed, are not otherwise deductible. Reimbursements for the travel expenses incurred by migrant workers are also excluded.

CALIFORNIA-DSS-MANUAL-FS

MANUAL LETTER NO. FS-92-09 Effective 10/5/92

Page 241

FOOD STAMP REGULATIONS

Regulations ELIGIBILITY DETERMINATIONS 63-502.2(g)(1)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(B) Reimbursements for out-of-pocket expenses of volunteers incurred in the course of their work.

(C) Medical, as specified in Section 63-502.331, or dependent care reimbursements.

(D) Reimbursements received by households to pay for services provided by Title XX of the Social Security Act.

(E) Reimbursements made to the household, as specified in Section 63-407.83, for expenses necessary for participation in an education component under the FSET Program.

(F) Payments or reimbursements made under an employment, education or training program initiated under Title IV-A of the Social Security Act after September 19, 1988, such as payments for GAIN supportive services.

(G) Any allowance provided by the state or county no more frequently than annually for children's clothes when the children enter or return to school or daycare, except as specified in Section 63-502.2(g)(2)(C). Verification of attendance at school or daycare is not required.

(H) Reimbursements received by households for participation in the GAIN Program.

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MANUAL LETTER NO. FS-96-05 Effective 12/1/96

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Regulations ELIGIBILITY DETERMINATIONS 63-502.2(g)(2)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(2) The following shall not be considered a reimbursement excludable under this provision:

(A) Portions of benefits provided under Title IV-A of the Social Security Act for work-related or child care expenses when adjustments have been made to the PA payments, except for such expenses made under an employment, education or training program initiated under Title IV-A after September 19, 1988.

(B) Clothing allowances specified in Section 63-502.2(g)(1)(F) if the monthly AFDC grant is reduced by the amount of the allowance during the month in which the allowance is provided.

CALIFORNIA-DSS-MANUAL-FS

MANUAL LETTER NO. FS-01-02 Effective 6/1/01

Page 243

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63-502.2(h) ELIGIBILITY DETERMINATIONS Regulations

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(h) Monies received and used for the care and maintenance of a third-party beneficiary who is not a household member. If the intended beneficiaries of a single payment are both household and nonhousehold members, any identifiable portion of the payment intended and used for the care and maintenance of the nonhousehold member shall be excluded. If the nonhousehold member's portion cannot be readily identified, the payment shall be evenly prorated among the intended beneficiaries and the exclusion applied to the nonhousehold member's pro rata share or the amount actually used for the nonhousehold member's care and maintenance, whichever is less.

(i) The earned income (as defined in Section 63-502.13) of children who are members of the household, who are elementary or secondary school students at least half time, and who have not attained their 19th birthday. Income of a student who attains their 19th birthday during the certification period, shall be excluded until the month following the month in which the student turned 19. If the student becomes 18 during an application month, the income is excluded in the month of application and counted in the following month except as specified in Section 63-507(a)(4)(A). The exclusion shall continue to apply during temporary interruptions in school attendance due to semester or vacation breaks, provided the child's enrollment will resume following the break. If the child's earnings or amount of work performed cannot be differentiated from that of other household members, the total earnings shall be prorated equally among the working members and the child's pro rata share shall be excluded. Individuals are considered children for purposes of this provision if they are under the parental control, as defined in Section 63-102(p)(1), of another household member.

(1) Earnings to household members under 19 years of age who are under the parental control of another adult household member and who are participating in on-the-job training programs under Section 204(b)(1)(C) or 264(c)(1)(A) of the Workforce Investment Act, regardless of school attendance and/or enrollment.

(j) Money received in the form of a nonrecurring lump-sum payment, including, but not limited to, income tax refunds, rebates, or credits; retroactive lump-sum social security, railroad retirement benefits, or other payments; retroactive payments from the approval of an application for any assistance program; AFDC homeless assistance payments for temporary shelter or permanent housing [see Section 63-102(h)]; court ordered retroactive payments for any assistance program; supplemental or corrective payments received for a previous month from any assistance program; lump-sum insurance settlements; or refunds of security deposits on rental property or utilities. These payments shall be counted as resources in the month received, in accordance with Section 63-501.111 unless specifically excluded from consideration as a resource by other federal laws as specified in Section 63-501.3(l), Section 63-506 or Section 63-507.

(1) TANF payments made to divert a family from becoming dependent on welfare shall be excluded as a nonrecurring lump-sum payment if the payment is not defined as assistance because of the exception for nonrecurrent short-term benefits in 45 CFR 260.31 (b)(1).

(k) The cost of producing self-employment income. The procedures for computing the cost of producing self-employment income are specified in Section 63-503.415.

CALIFORNIA-DSS-MANUAL-FS

MANUAL LETTER NO. FS-06-04 Effective 11/1/06

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Regulations ELIGIBILITY DETERMINATIONS 63-502 (Cont.)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(l) Income that is specifically excluded for Food Stamp purposes by any other federal statute as specified in Section 63-507.

(m) Repealed by Manual Letter No. FS-91-06, effective 8/1/91.

(n) Any payment made to an FSET Program participant, as specified in Section 63-407.83, for costs that are reasonably necessary and directly related to participation in the FSET Program.

(1) These costs include, but are not limited to:

(A) Dependent care costs, including the value of any dependent care service provided or arranged by the CWD;

(B) Transportation; and

(C) Other expenses related to work, training or education, such as uniforms, personal safety items or other necessary equipment and books or training manuals.

(2) These costs shall not include the cost of meals away from home.

(o) Foster care payments received by households with foster care boarders who are not part of the food stamp household.

(p) Child support payments that a household member pays to or for an individual living outside of the household.

(1) The child support exclusion is the monthly amount of child support payments that a household member, with a legal obligation to pay child support payments to or for an individual living outside of the household, actually makes.

(2) The payments shall be verified as specified in Section 63-300.51(j).

(3) Households that fail or refuse to cooperate by supplying the necessary verifications shall have their eligibility and benefit level determined without a child support exclusion.

(4) Payments are excluded only to the extent that they represent the household's child support obligation which has been ordered by a court or administrative authority.

(5) Child support payments made to a third party (e.g., a landlord or utility company) on behalf of the nonhousehold member in accordance with the support order shall be included in the child support exclusion. Payments made by a household with a legal obligation to obtain health insurance for a child shall also be included as part of the child support exclusion.

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MANUAL LETTER NO. FS-06-04 Effective 11/1/06

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63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(6) Amounts paid toward arrearages shall be excluded from being counted as income.

(q) All payments excluded from consideration as income in the Eligibility and Assistance Standards Manual at Section 44-111, with the exception of Sections 44-111.222, .223, .224, 23 and .43.

HANDBOOK BEGINS HERE

(1) Examples of excluded income include, but are not limited to, the following:

(A) Any college work study programs.

(B) Child/Spousal support Disregard. The first $50 per month of current child/spousal support paid to or on behalf of an assistance unit shall be disregarded when determining both eligibility and grant amount.

(C) Job Training Partnership Act (JTPA). All payments to and earnings of a child which are derived from participation in JTPA programs. All payments to an adult which are derived from participation in JTPA programs.

(D) All earned income of a child under 19 years old is exempt if he/she is a full-time student, or he/she has a school schedule that is equal to at least one-half of a full time curriculum, and he/she is not employed full time.

(E) Independent Living Program (ILP). Income and incentive payments earned by a child 16 years of age or older who is participating in the ILP.

(F) Relocation Assistance Benefit, paid by a public agency to a recipient who has been relocated as a result of a program of area redevelopment, urban renewal, freeway construction or any other public development, involving demolition or condemnation of existing housing.

(G) Payments received under the California Victims of Crimes Program.

(H) Allowance for training expenses paid to recipients participating in Department of Rehabilitation training programs.

(I) Any award or scholarship provided to or on behalf of a dependent child based on the child's academic or extracurricular activity.

(J) Contribution from persons or organizations that would not be available for expenditure unless used in accord with conditions imposed by the donor. For example, an uncle gives $200 to the household to purchase new tires. $200 is exempt when receipts for the intended purpose verify the expenditure.

HANDBOOK ENDS HERE

CALIFORNIA-DSS-MANUAL-FS

MANUAL LETTER NO. FS-06-04 Effective 11/1/06

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Regulations ELIGIBILITY DETERMINATIONS 63-502.33

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

.3 Income Deductions

The CWDs shall allow the income deductions contained in this section when determining the Food Stamp household's net income eligibility and benefit level. The standard deduction, excess medical deduction, homeless standard shelter allowance, and the excess shelter deduction are: promulgated and updated by the USDA; published, as specified in 7 CFR 273.9(d)(1), (3), and (5); and to be implemented upon their effective date. The amounts for the earned income deduction and the dependent care deduction for nonelderly households are determined by federal law and published by the USDA in 7 CFR 273.9(d)(2) and (4), respectively. The current amounts are reproduced in Handbook Section 63-1101. Deductions shall be allowed only for the following:

.31 Standard Deduction

.311 A standard deduction is allowed for each household per month in an amount that is:

(a) Equal to 8.31 percent of the income standard of eligibility established under MPP Section 63-409.1; but

(1) not more than 8.31 percent of the income standard of elgibility established under MPP Section 63-409.1 for a household of six members.

(b) The standard deduction for each household shall not be less than $134.

.32 Earned Income Deduction

The earned income deduction is a percentage of gross earned income as defined in Section 63-502.1. Earnings excluded in Section 63-502.2 shall not be included in gross earned income for purposes of computing the earned income deduction.

.33 Excess Medical Deduction

The excess medical deduction is the portion of medical expenses in excess of the allowable amount per month, excluding special diets, incurred by any household member who is elderly or disabled as defined in Section 63-102(e). Spouses or other persons receiving benefits as a dependent of the disability recipient are not eligible to receive this deduction.

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MANUAL LETTER NO. FS-06-04 Effective 11/1/06

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Regulations ELIGIBILITY DETERMINATIONS 63-502.331 (Cont.)

63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

.331 Allowable medical expense items are:

(a) Medical and dental care including psychotherapy and rehabilitation services provided by a licensed practitioner or other qualified health professional authorized by state law (see Section 63-102);

(b) Hospitalization or outpatient treatment, nursing care, and nursing home care, including payments by the household for an individual who was a household member immediately prior to entering a hospital or nursing home, provided by a facility authorized under state law;

(c) Prescription drugs when prescribed by a licensed practitioner authorized under state law and other over-the-counter medication (including insulin) when prescribed by a licensed practitioner or other qualified health professional. In addition, costs of medical supplies, sick-room equipment (including rental) or other prescribed equipment are deductible;

(d) Health and hospitalization insurance policy premiums. (The costs of sickness and accident policies such as those payable in lump-sum settlements for death or dismemberment or income maintenance policies such as those that continue mortgage or loan payments while the beneficiary is disabled are not deductible);

(e) Medicare premiums related to coverage under Title XVIII of the Social Security Act; any share of cost or spend down expenses for medical costs incurred by Medi-Cal recipients;

(f) The cost of securing and maintaining any service animal such as, but not limited to, seeing eye, hearing or service dogs, and the cost of related food and veterinarian bills;

(g) Eye glasses or contact lenses prescribed by a physician skilled in eye disease or by an optometrist; dentures, hearing aids and prosthetics (including assistive devices);

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63-502 INCOME, EXCLUSIONS AND DEDUCTIONS (Continued) 63-502

(h) Actual cost of transportation provided that the allowance shall not exceed the actual cost of the least expensive mode of transportation (including common carrier) reasonably available to the recipient; and lodging to obtain medical treatment or services. When a more costly means of transportation, such as a taxi or private auto is the only means available, or has been determined by the county to have been reasonable and necessary given the individual's medical circumstances, the actual costs of such transportation shall be allowed.

(i) Maintaining an attendant, homemaker home health aide or child care services housekeeper, necessary due to age, infirmity, or illness. In addition, an amount equal to the one person coupon allotment shall be deducted if the household furnishes the majority of the attendant's meals. The allotment for this meal related deduction shall be that in effect at the time of the most recent certification. The EW shall update the allotment amount at the next scheduled recertification, or next recomputation, or the next reported change by the household, whichever is earlier. If a household incurs attendant care costs that could qualify under both the medical deduction and dependent care deduction, it shall be treated as a medical expense.

.34 Dependent Care Deduction

The dependent care deduction is the actual cost not to exceed the maximum dependent care deduction for the care of a child or other dependent.

.341 The dependent care cost shall be allowed as a deduction when necessary for a household member to:

(a) Accept or continue employment;

(b) Comply with the Food Stamp Employment Training (FSET) Program requirements as specified in Section 63-407.8 or an equivalent effort to seek employment by those not subject to FSET; or

(c) Attend training or pursue education which is preparatory to employment.

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.342 If the Food Stamp eligible household member(s) shares dependent care costs with others, the household's deduction amount shall be determined as specified in Section 63-502.36.

.35 Homeless Shelter Deduction

.351 The homeless shelter deduction is available to homeless households who are not receiving free shelter for the entire month, fiscal or calendar, depending on the county's issuance cycle. If the homeless shelter deduction is used, separate utility costs are not allowed, since this allowance includes a utility cost component.

.352 If a homeless shelter deduction is allowed, an excess shelter deduction computation is not computed per Section 63-503.311(h).

.353 All homeless households which incur, or reasonably expect to incur, shelter costs during a month shall be eligible to use the homeless shelter deduction without providing verification of the shelter costs. Higher shelter costs may be used if verification is provided.

.354 Homeless households which do not incur shelter costs during the month shall not be eligible for the homeless shelter deduction.

.36 Excess Shelter Deduction

The excess shelter deduction is monthly shelter costs in excess of 50 percent of the household's income after all other applicable deductions in Sections 63-502.31, .32, .33 and .34 have been allowed. The excess shelter deduction shall not exceed the current maximum, unless the household contains a member who is elderly or disabled as defined in Section 63-102(e).

.361 If the Food Stamp eligible household member(s) shares shelter costs with others, the household's deduction amount shall be determined as specified in Section 63-502.37.

.362 Shelter costs shall include only the following:

(a) If actual verified homeless shelter costs are higher than the homeless shelter deduction, the actual cost may be used as a housing cost instead of a homeless shelter deduction and utility costs may be claimed.

(b) Continuing costs for the shelter occupied by the household, including rent, mortgage, or other continuing costs leading to the ownership of the shelter such as loan repayments for the purchase of a mobile home, including interests on such payments. One-time deposits, such as security deposits, shall not be included as shelter costs.

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(c) Property taxes, state and local assessments, and insurance on the structure itself, but not separate costs for insuring furniture or personal belongings.

(d) The cost of heating and cooking fuel; cooling and electricity; water and sewerage; garbage and trash collection fees; the basic service and rental fee for one telephone, including tax on the basic fee; and fees charged by the utility provider for initial installation of the utility. One-time deposits shall not be included as shelter costs.

(e) The shelter costs for the home if temporarily not occupied by the household because of employment or training away from home, illness, or abandonment caused by natural disaster or casualty loss. For costs of a home vacated by the household to be included in the household's shelter costs, the household must intend to return to the home; the current occupants of the home, if any, must not be claiming the shelter costs for food stamp purposes; and the home must not be leased or rented during the absence of the household.

(f) Costs for the repair of the home which was substantially damaged or destroyed due to a natural disaster such as a fire or flood. Shelter costs shall not include costs for repair of the home that have been or will be reimbursed by private or public relief agencies, insurance companies, or from any other source.

.363 Standard Utility Allowance (SUA)

(a) Entitlement to SUA

(1) The SUA is mandatory for all households which incur heating or cooling costs separate and apart from their rent or mortgage payments. This includes residents of rental housing who are billed on a monthly basis by their landlords for actual usage as determined through individual metering.

(A) Households who are using the homeless shelter deduction shall not be entitled to the SUA because a utility component is included in the homeless shelter deduction.

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(2) The SUA shall also be made available to households receiving energy assistance payments made under the Low Income Home Energy Assistance Act (LIHEAA) of 1981. Households which receive energy assistance vendor payments made under a program other than the LIHEAA of 1981, are eligible for the SUA only if they continue to incur out-of-pocket heating or cooling expenses during any month covered by the certification period. To determine if a household incurs an out-of-pocket heating or cooling expense in addition to the energy assistance vendor payments, the CWD shall prorate the energy assistance vendor payments over the entire heating or cooling season the payment is intended to cover.

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(b) The SUA for food stamp households shall be adjusted annually by CDSS to reflect increases or decreases in the cost-of-living. The SUA annual adjustments shall take effect on October 1st.

(1) The cost-of-living shall be calculated by CDSS based on the weighted average of the Fuel and Other Utilities Index of the Consumer Price Index for All Urban Consumers (CPI-U), when published by the U.S. Department of Labor, Bureau of Labor Statistics for Los Angeles-Riverside-Anaheim and San Francisco-Oakland-San Jose. The weighting factor for each area is as used by the State Department of Industrial Relations to calculate the California Consumer Price Index (CCPI).

(2) The percentage change to be determined shall be for a 12-month period ending with March of the same year for which the cost-of-living adjustment will take effect. The SUA in effect during the month of October preceding the calendar year in which the adjustment is to take place will be increased/decreased by the 12-month percentage change, with the resulting SUA to be rounded to the nearest dollar. The result shall constitute the new SUA (see Handbook Section 63-1101.26).

(c) When the SUA is revised due to the annual adjustments, it shall be applied to all households on the effective date of the revised SUA (see Handbook Section 63-1101.26). The change to the new SUA shall not be considered a switch from the actual amounts to the SUA for purposes of Section 63-502.352(c).

(d) A household that is not eligible for the SUA, but incurs expenses for at least two separate types of utilities (other then heating and cooling) is eligible for a Limited Utility Allowance (LUA). Allowable utilities include telephone, water, sewerage, and garbage or trash collection. The LUA will be adjusted annually in accordance with Sections 63-502.363(b) and (b)(2).

(1) The cost-of-living shall be calculated by CDSS based on the U.S. City Average, using the Water, Sewer, and Trash Utility Index of the CPI-U, when published by the U.S. Department of Labor, Bureau of Labor Statistics.

(e) A household that is not eligible for either the SUA or LUA, but incurs telephone costs only, is entitled to a Telephone Utility Allowance (TUA) of $20. It shall be used only in instances where the household has a telephone, or in its absence, an equivalent form of communication.

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(f) Verification of utility expenses shall be made as specified in Sections 63-300.51(f) and 63-504.341.

.37 Shared Living Expense Deductions

Shared living expenses include allowable shelter, utility and/or dependent care expenses which the Food Stamp eligible household member(s) shares with an excluded/ineligible household member(s) or another household which may or may not be participating in the Food Stamp Program.

.371 Treatment of a Food Stamp Household that Contains an Excluded Member(s)

When the food stamp household lives with and shares utility expenses with an excluded/ineligible household member(s), the CWD shall not prorate the SUA.

.372 Treatment of Separate Households

The food stamp household may live with another household(s) which may or may not participate in the Food Stamp Program. If these households share shelter and/or utility expenses, the CWD will allow expenses for each household. If the food stamp eligible household(s) is eligible for a utility allowance, it will receive the full allowance and there will be no pro-ration among eligible households.

(a) For the food stamp household(s), the CWD shall use the household's utility allowance and the household's actual shelter/rent expense to determine the shelter deduction, based on its household composition. Refer to Sections 63-502.373 and .374.

.373 Food Stamp Households with Excluded Members

The CWD must identify which excluded members are contributors. Contributors are those household members who share the residence and the expense of that residence by paying or obligating money from their separate income or resources.

(a) IPV Disqualifications and/or Workfare/Work Sanctions

If the food stamp household shares deductible expenses with members who are excluded because they are IPV disqualified or have been sanctioned for refusing to fulfill workfare or work requirements, the entire rent and utility allowance are counted as deductions for the Food Stamp household budget.

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(b) Ineligible Noncitizens and/or SSN Disqualifications

If the food stamp household members who are ineligible noncitizens or members excluded for SSN disqualification pay part or all of the deductible expenses, the expenses (excluding the utility allowance) will be prorated among all members and only the eligible members' share is counted as the deduction. Refer to MS 63-502.375 for instructions on how to prorate. Utility allowances shall not be pro-rated.

(1) If any ineligible noncitizen contributes to the household expenses, all ineligible noncitizens of that household are counted in the proration. If any SSN disqualified member contributes to the household expense, all SSN disqualified members of that household are counted in the proration.

(2) To be considered a contributor the ineligible noncitizen or SSN disqualified member must actually be using his/her income or resources to contribute. If s/he is acting solely as an agent or payee for another household member, s/he would not be included in the proration.

(A) Any of these members who have income must be included in the proration of expenses.

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(3) EXAMPLE: Household composition:

Father - an ineligible noncitizen, does not contribute to expenses

Mother - an eligible noncitizen receiving AFDC, contributes to expenses

Two children receiving AFDC

The CWD would not consider the father in the proration calculation solely based on his relationship with the mother. He is not calculated into the proration because he does not contribute.

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(c) SSI recipients and/or Excluded Students

If the food stamp household shares deductible expenses with members who are excluded because they are SSI recipients or excluded students, amountscontributed by those excluded members shall be deducted from the allowable expense. Only the remaining dollar amount shall be allowed as the Food Stamp household's deduction. Utility allowance shall not be pro-rated.

(1) If payments or contributions made by these excluded members cannot be differentiated, the expenses shall be prorated evenly among the members contributing to the expense and only the food stamp household's pro rata share is counted as the deduction.

(2) If an SSI recipient and/or excluded student household member does not contribute to the household expenses, he/she is not counted in the proration.

HANDBOOK BEGINS HERE

.374 CWDs may use the following chart when calculation shelter expenses in shared living situations. Additionally, the following steps may be helpful in the calculation process:

(a) Determine the number of households sharing the residence (refer to MS 63.502.361). Use household composition rules and the Decision Chart below.

(b) Determine the number of households contributing to the expense.

(c) Determine the amount of the Food Stamp household's contribution. See the Rent Decision Chart below.

(d) If the Food Stamp household contains excluded members, see the Decision Chart below.

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DEDUCTION DECISION CHART IN SHARED LIVING ARRANGEMENTS

Within Residence Within FSHH

Separate HHs: IPV/Work Sanction SSI/Recipient Ineligible

Includes roomers, Within the FSHH Excluded Noncitizen/SSN

attendants, or others Student Disqualified

who live with HH but Within the Within the FSHH

purchase and prepare FSHH

separately (i.e., another

family)

HH Composition No. Yes, as determined Yes, as Yes, as determined

Test: Would the by HH composition determined by HH composition

person(s) be an rules. Items below by HH rules. If yes, then

otherwise eligible apply. composition items below apply.

HH member(s), per rules.

HH composition

rules?

(M.S. 63-402.1)

Shelter Allow actual amount Count total of Deduct contri- Prorate expense:

(M.S. 63-502.35) paid by FSHH as its eligibles' and bution of ex- Divide evenly

deduction. IPV/Work cluded among eligibles

sanctioned members from and these excluded

If contribution cannot excluded members' expense, and members; count

be differentiated, prorate rent in FS budget. allow the FSHH eligibles' share.

by the number of HHs the remainder

contributing. as its deduction.

If contribution

cannot be differ-

entiated, prorate

and allow only the

portion attributed

to eligible HH

members.

HANDBOOK CONTINUES

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HANDBOOK CONTINUES

DEDUCTION DECISION CHART IN SHARED LIVING ARRANGEMENTS (Continued)

Within Residence Within FSHH

Separate HHs: IPV/Work Sanction SSI/Recipient Ineligible

Includes roomers, Within the FSHH Excluded Noncitizen/SSN

attendants, or others Student Disqualified

who live with HH but Within the Within the FSHH

purchase and prepare FSHH

separately (i.e., another

family)

Resources Not available to FSHH. Count all. Not available to Count all.

(M.S. 63-501.1) FSHH.

Income Not available to FSHH. Count all Not available to Prorate: Divide

(M.S. 63-502.1) (If person makes a cash FSHH (If person evenly among

contribution to HH, apply makes a cash eligibles and

normal income standards.) contribution to these excluded

HH, apply normal members; count

income standards). eligibles' share.

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.375 To prorate within the food stamp household, the CWD shall:

(a) Find the sum of contributors. The categories and treatment of contributors are as follows:

(1) Household members excluded for food stamps: Count all food stamp eligible persons plus any person disqualified for IPV or workfare/work sanction.

(2) Household members excluded due to noncitizen status or is SSN disqualified: If one ineligible noncitizen contributes or has income, count all ineligible noncitizens. If one SSN disqualified member contributes or has income, count all SSN disqualified members.

(3) Household members excluded due to being an SSI recipient or excluded student: Count only the person(s) contributing when the contribution cannot be differentiated.

(b) Divide the total applicable expense by the total number of contributors found in (a) above to arrive at the pro rata share per person.

(c) Multiply the pro rata share from (b) above by the number of food stamp eligible persons and IPV or workfare/work sanctioned persons from (a)(1) above. This is the pro rata share of expenses to allow the food stamp eligible members.

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.376 EXAMPLES

NOTE: The SUA figure used in the examples below is the Federal Fiscal Year 2004 figure. This section will not be amended to reflect adjustments to the SUA, which can occur annually. CWDs will need to use the current SUA figure when calculating deductions.

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I. Mother- ineligible noncitizen, contributes towards rent and utilities

2 Children - AFDC

Total rent: $300 eligible for SUA: = $227

Step 1. Determine number of HHs sharing the residence

HH A: Ineligible noncitizen, mother and two AFDC children

Step 2. Determine number of HHs contributing to the expense

HH A = 1

Step 3. Determine the amount of each HH's contribution

HH A: Rent $300 SUA: $227

Step 4. Determine amount to be used in FS budget

Rent: $300 ÷ 3 = $100 x 2=$200 SUA: $227 Full SUA allowed.

II. Mother - ineligible noncitizen; doesn't contribute to expenses; has no income.

2 Children- AFDC

Total rent: $300 eligible for SUA: $227

Step 1. Determine number of HHs sharing the residence

HH A: Ineligible noncitizen mother, and two AFDC children

Step 2. Determine number of HHs contributing to the expense

HH A = 1

Step 3. Determine the amount of each HH's contribution

HH A: Rent $300 SUA: $227

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Step 4. Determine amount to be used in FS budget

HH A: Rent $300 ÷ 2 (AFDC children) = $150

$150 x 2 (AFDC children) = $300

SUA $227

Whether or not the ineligible noncitizen contributes, the FSHH is allowed the full SUA (i.e. no proration of the SUA if the FSHH is contributing toward utilities).

III. Mother - ineligible noncitizen; contributes towards rent and utilities

2 Children - AFDC

Unrelated adult - shares expenses and contributes $150 for rent and $113 for utilities; purchases and prepares food separately

Excluded student - no contribution; purchases and prepares with mother and children

Total rent: $400 eligible for SUA: $227.

Step 1. Determine number of HHs sharing the residence

HH A: Ineligible noncitizen mother, 2 AFDC children, and excluded student

HH B: Unrelated adult

Step 2. Determine number of HHs contributing to the expense

HH A + HH B = 2

Step 3. Determine amount of each HHs' contribution

HH A: Rent $400-$150 = $250 SUA $227

HH B: Rent $150 SUA $227 (if food stamp eligible)

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HANDBOOK CONTINUES

Step 4. Determine amount to be used in FS budget

HH A: Rent $250 ÷ 3 (mother + 2 AFDC children) =

$83.33 x 2 (2 children) = $166.67

NOTE: Excluded student doesn't contribute, therefore isn't included in the proration

SUA Allow full SUA for HH A and HH B (if food stamp eligible).

IV. Mother - IPV disqualified: contributes to rent and utilities

2 Children - AFDC

SSI recipient contributes, but amount of contribution is unknown; purchases and prepares with mother and children

Total rent: $400 eligible for SUA: $227

Step 1. Determine number of HHs sharing the residence

HH A: IPV Disqualified mother, 2 AFDC children, and SSI recipient

Step 2. Determine number of HHs contributing to the expense

HH A = 1

Step 3. Determine amount of each HHs contribution

HH A: Rent $400

SUA $227

Step 4. Determine amount to be used in FS budget

HH A: Rent $400 ÷ 4 (mother, two children and SSI recipient)

= $100 x 3 (2 AFDC children + mother) = $300

SUA $227 SUA allowed.

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HANDBOOK CONTINUES

V. Father - contributes to utilities and shelter

3 Children - AFDC

Ineligible noncitizen

adult - unemployed ineligible noncitizen who contributes $150 per month for rent and utilities; purchases and prepares with father and children

Total Rent: $400 eligible for SUA: $227

Step 1. Determine number of HHs sharing the residence

HH A: Father and 3 children on AFDC; ineligible noncitizen

Step 2. Determine number of HHs contributing to the expense

HH A = 1

Step 3. Determine amount of each HH's contribution

HH A: Rent $400 SUA $227

Step 4. Determine amount to be used in FS budget

HH A: Rent $400 ÷ 5 = $80

$80 x 4 (father and 3 children) = $320

NOTE: Known contribution of ineligible alien is not deducted. He/she is included

in the proration and the FSHH is allowed all but his portion.

SUA $227. SUA allowed.

VI. Mother- contributed to rent and utilities

2 Children receive AFDC

SSI child - sibling of AFDC children; contribution unknown

Ineligible noncitizen

adult no contribution; purchases and prepares food with mother and children

SSI grandmother - contributes $150 towards rent; purchases and prepares separately

Total rent: $500 eligible for SUA: $227

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HANDBOOK CONTINUES

Step 1. Determine number of HHs sharing the residence

HH A: Mother, 2 AFDC children, SSI child, and ineligible noncitizen adult

HH B: SSI grandmother

Step 2. Determine number of HHs contributing to the expense

HH A + HH B = 2

Step 3. Determine amount of each HH contribution

HH A: Rent $500 - $150 = $350 SUA $227

HH B: Rent $150

Step 4. Determine amount to be used in FS budget

HH A: Rent $350 ÷ 4 (mother, SSI child, and AFDC children) =

$87.50 x 3 (mother and AFDC children)* = $262.50

SUA $227. SUA Allowed.

*Note: The ineligible noncitizen was not included in the proration of the rent in Step 4 as this individual does not pay anything towards these expenses (therefore is not a contributor).

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