63-801 CLAIMS AGAINST HOUSEHOLDS 63-801

(a) Signed the application form;

(b) Completed a current work registration form;

(c) Was certified in the correct county.

.122 The household transacted, but did not alter an expired authorization document.

.13 Claims Against Alien Households and Sponsors of Alien Households

.131 The CWD shall hold the alien's household solely liable for repayment of an overissuance in benefits, and establish a claim against the household, if the CWD determines that the sponsor had good cause or was not at fault for providing the incorrect information that resulted in the overissuance.

.132 If the CWD determines that the sponsor did not have good cause, or was at fault, as specified in Section 63-801.413, the CWD shall establish a claim for the overissuance against either the sponsor or the sponsored alien's household, or both. The CWD either shall establish claims against both parties at the same time or establish a claim against the party it deems most likely to repay first.

(a) If a claim is established against the sponsor first, the CWD shall ensure that a claim is established against the household whenever the sponsor fails to respond within 30 days of receipt to the notice of action requesting repayment.

(b) The CWD shall return to the sponsor and/or the household any amounts repaid in excess of the total amount of the claim as determined on the DFA 842.

.2 Types of Claims

The CWD shall categorize and account for all claims against households as inadvertent household error claims, administrative error claims or intentional Program violation claims.

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.21 Inadvertent Household Error Claims

.211 A claim shall be handled as an inadvertent household error claim if the overissuance was caused by a misunderstanding or unintended error on the part of the household or the sponsor of an alien household. This shall also apply to such errors made by categorically eligible households, provided the claim can be calculated based on a change in net income and/or household size.

.212 Instances of inadvertent household error which may result in a claim include, but are not limited to, the following:

(a) The household, or the sponsor unintentionally failed to provide the CWD with correct or complete information.

(b) The household unintentionally failed to report to the CWD changes in household circumstances or the circumstances of its sponsor.

(c) The household unintentionally received benefits or more benefits than it was entitled to receive pending a state hearing decision because the household requested a continuation of benefits based on the mistaken belief that it was entitled to such benefits.

.22 Administrative Error Claims

.221 A claim shall be handled as an administrative error claim if the overissuance was caused by the action or inaction of any CWD. This shall also apply to categorically eligible households only when the CWD incorrectly determined the household's net income and/or household size. The only exception is an overpayment caused by a household transacting an untampered Authorization to Participate (ATP) card.

.222 CDSS does not compromise overissuances with the exception of administrative error overissuances in which allotment reduction began on or after March 1, 2000. These administrative error overissuances are automatically compromised and recouped pursuant to the Lomeli v. Saenz court case settlement agreement. This agreement stipulates that administrative error overissuances are to be recouped by reducing the monthly allotment by five percent or $10.00, whichever is greater for up to a total of 36 consecutive calendar months.

.223 Instances of administrative error which may result in a claim include, but are not limited to, the following:

(a) The CWD failed to take prompt action on a change reported by the household.

(b) The CWD incorrectly computed the household's income or deductions, or otherwise assigned an incorrect allotment.

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(c) The CWD incorrectly issued duplicate authorization documents which were subsequently transacted by the household.

(d) The CWD continued to provide a household with food stamp allotments after its certification period had expired without benefit of a reapplication determination.

(e) The Agency failed to provide a household a reduced allotment because its PA grant increased.

.23 Intentional Program Violation Claims

.231 A claim shall be handled as an intentional Program violation claim for an overissuance or trafficking only if an administrative disqualification hearing official or a court of appropriate jurisdiction has determined that a household member or the sponsor had committed an intentional Program violation, as defined in Section 20-300.1 or if an individual accused of intentional Program violation has signed either a Disqualification Consent Agreement or an Administrative Disqualification Hearing Waiver as defined in Sections 63-102(a)(2) and (d)(6). Prior to a determination of intentional Program violation the claim against the household shall be established and handled as an inadvertent household error claim.

.232 Repealed by Manual Letter No. FS-87-12, effective 10/1/87.

.3 Calculating the Amount of Claims

.31 Inadvertent Household and Administrative Error Claims

.311 For each month that a household received an overissuance due to an inadvertent household or administrative error, the CWD shall determine the correct amount of food stamp benefits the household was entitled to receive.

(a) The CWD shall not allow claims established prior to April 1, 1984 to be recalculated for non-IPV-caused overissuances which occurred more than 12 months prior to the month of discovery.

For an IPV claim, calculate the claim back to the month that the IPV first occurred.

(b) The CWD shall calculate the amount of the overissuance which occurred during the six years preceding the date the overissuance was discovered. The CWD shall not include in its calculation any amount of the overissuance which occurred in a month more than six years prior to the date the overissuance was discovered.

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(c) In cases involving reported changes, the CWD shall determine the month the overissuance initially occurred as follows:

(1) If, due to an inadvertent error on the part of the household, the household failed to report a change in its circumstances within the time frames required in Section 63-505, the first month affected by the household's failure to report shall be the first month in which the change would have been effective had it been timely reported. However, in no event shall the CWD determine as the first month in which the change would have been effective any month later than two months from the month in which the change in household circumstances occurred.

(2) Section 63-801.311(c)(2)(MR) shall become inoperative and Section 63-801.311(c)(2)(QR) shall become operative in a county on the date QR/PB becomes effective in that county, pursuant to the Director's QR/PB Declaration.

(MR) For monthly reporting households, a claim shall be established when the household fails to report a change on the CA 7 by the extended filing date for the appropriate report month. For nonmonthly reporting households, a claim shall be established if the household fails to report a change within 10 days of the date the change became known.

(QR) For QR households, a claim shall be established when the household fails to report a change on the QR 7 for the appropriate Data Month and the QR Payment quarter was incorrectly computed based on failure of the recipient to report a change or a timely QR 7 was not submitted (see Handbook). For change reporting households, a claim shall be established if the household fails to report a change within 10 days of the date the change became known.

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HANDBOOK BEGINS HERE

Example: A QR 7 is not received timely and a 10-day notice cannot be sent to the recipient to reduce benefits beginning with the next QR Payment quarter: In the January/February/March quarter, a recipient submits the QR 7 on March 28, after the deadline for timely submission. After redetermining benefits based on information reported on the QR 7, the CWD determines that the April/May/June benefits should be reduced due to income reported on the QR 7. The QR 7 was submitted too late in the month for the CWD to provide 10-day notice and decrease benefits for April. The CWD issues a 10-day notice of decrease effective for May; pays benefits at the March level in April, and adjusts benefits to the correct amount for May and June. The difference between the May/June benefit amount and the April benefit amount is an O/I.

HANDBOOK ENDS HERE

(3) If the household timely reported a change, but the CWD did not act on the change within the required time frames, the first month affected by the CWD's failure to act shall be the first month the CWD would have made the change effective had it timely acted. However, in no event shall the CWD determine as the first month in which the change would have been effective any month later than two months from the month in which the change in household circumstances occurred.

.312 If the household received a larger allotment than it was entitled to receive, the CWD shall establish a claim against the household equal to the difference between the allotment the household received and the allotment the household should have received.

(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) For further action required when the overissuance is discovered for a month or months in which any member has already performed a Workfare or work component requirement, see Section 63-407.89.

(c) When determining the amount of benefits the household should have received, the CWD shall not apply the 20 percent earned income deduction to that portion of earned income which the household failed to report.

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.313 After calculating the amount of the inadvertent household or administrative error claim, the CWD shall offset the amount of the claim against any amounts which have not yet been restored to the household as a restoration of lost benefits in accordance with Section 63-802.54. The CWD shall then initiate collection action for the remaining balance, if any.

HANDBOOK BEGINS HERE

The California Department of Social Services and the CWDs are permanently enjoined by court order in Lopez v. Glickman from applying that part of 63-801.313 regarding the offset of administrative error claims. CWDs shall not offset the amount of an administrative error claim against any amount of lost benefits which have not yet been restored to the household.

HANDBOOK ENDS HERE

.32 Intentional Program Violation Claims

.321 For each month that a household received an overissuance due to an act of intentional Program violation, the CWD shall determine the correct amount of food stamp benefits, if any, the household was entitled to receive. The amount of the intentional Program violation claim shall be calculated back to the month the act of intentional Program violation occurred, regardless of the length of time that elapsed until the determination of intentional Program violation was made or the date the Waiver of Right to an Administrative Disqualification Hearing or Disqualification Consent Agreement was signed.

However, the CWD shall not include in its calculation any amount of the overissuance which occurred in a month more than six years from the date the overissuance was discovered or prior to March 1, 1979. If the household member is determined to have committed intentional Program violation by intentionally failing to report a change in its household's circumstances, the first month affected by the household's failure to report shall be the first month in which the change would have been effective had it been reported. However, in no event shall the CWD determine as the first month in which the change would have been effective any month later than two months from the month in which the change in household circumstances occurred.

.322 If the household received a larger allotment than it was entitled to receive, the CWD shall establish a claim against the household equal to the difference between the allotment the household received and the allotment the household should have received.

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.323 When determining the amount of benefits the household should have received, the CWD shall not apply the 20 percent earned income deduction to that portion of earned income which the household intentionally failed to report as determined by an administrative disqualification hearing or a court of appropriate jurisdiction or by the signing of an Administrative Disqualification Hearing Waiver or a Disqualification Consent Agreement.

.324 Once the amount of the intentional Program violation claim is established, the CWD shall offset the claim against any amount of lost benefits that have not been restored to the household as lost benefits in accordance with Section 63-802.54.

.33 Trafficking-Related Claims

.331 Claims arising from trafficking-related offenses will be the value of the trafficked benefits as determined by the following:

(a) Admission by the individual;

(b) Adjudication; or

(c) Documentation that is the basis for the trafficking determination.

.332 The CWD must establish a claim before the last day of the quarter following the quarter that the overpayment or trafficking incident was discovered. The CWD will ensure that no less than 90 percent of all claim referrals are established or disposed of in this time frame.

.4 Collecting Claims Against Households and Sponsors of Alien Households

.41 Criteria for Initiating Collection Action on Inadvertent Household and Administrative Error Claims

.411 CWDs shall initiate collection action against the household for all inadvertent household error claims, or administrative error claims or against the sponsor in accordance with Section 63-801.413, unless one of the following conditions apply:

(a) The total amount of the claim is less than $35, and the claim cannot be recovered by reducing the household's allotment.

(b) The CWD has documentation which shows that the household or the sponsor of an alien household cannot be located.

.412 The CWD may postpone collection action on inadvertent household error claims in cases where an overissuance is being referred for possible legal prosecution or for administrative disqualification, and the CWD determines that collection action will prejudice the case.

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.413 Prior to initiating collection action against the household of a sponsored alien for repayment of an overissuance caused by incorrect information having been provided concerning the alien's sponsor or sponsor's spouse, the CWD shall determine whether such incorrect information was provided due to inadvertent error or intentional Program violation on the part of the alien or the alien's sponsor. The CWD shall inform the alien's sponsor that neither the sponsor nor his/her spouse shall be held responsible for repayment of the overissuance if the sponsor can demonstrate that he/she had good cause or was not at fault for the incorrect information having been provided to the CWD.

(a) A sponsor will be without fault or have good cause for not providing correct information only when the sponsor has met all of his/her responsibilities in providing correct information, but the alien has not.

(b) A sponsor shall not be held at fault for a CWD administrative error.

.42 Criteria for Initiating Collection Action on Intentional Program Violation Claims

If an administrative disqualification hearing official or a court of appropriate jurisdiction finds that a household member or the sponsor of an alien household member committed intentional Program violation or if an individual accused of intentional Program violation signs either an Administrative Disqualification Hearing Waiver or Disqualification Consent Agreement, the CWD shall initiate collection action against the individual's household or the sponsor of the alien household member. In addition, to the extent possible, the CWD shall make a personal contact with the household and/or its sponsor.

.421 The CWD shall initiate such collection unless:

(a) the household has repaid the overissuance already,

(b) the CWD has documentation which shows the household (and its sponsor, if an alien household), cannot be located, or,

(c) the CWD determines that collection action will prejudice the case against a household member referred for legal prosecution.

.422 The CWD shall initiate collection action for an unpaid or partially paid claim even if collection action was previously initiated against the household while the claim was being handled as an inadvertent household error claim. In cases where a household member was found guilty of intentional Program violation by a court or has signed a Disqualification Consent Agreement, the CWD shall request that the matter of restitution be brought before the court or addressed in the agreement reached between the prosecutor and accused individual.

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.43 Initiating Collection on Claims

.431 CWDs shall initiate collection action by providing the household or the sponsor of an alien household an initial notice of action to begin collection action and requesting repayment. (Subsequent demand letters or notices may be sent at the discretion of the CWD.) The due date or time frame for repayment must be no later than 30 days after the date of the initial notice of action, and shall provide the following information:

(a) The amount owed, the type (IPV, IHE, or AE) and reason for the claim, the period of time the claim covers, how the claim was calculated, any offsetting that was done to reduce the claim, how the household or its sponsor may pay the claim, the household's or the sponsor's right to a state hearing if the household or the sponsor disagrees with the amount of the claim, and that the household has 90 days to request a fair hearing.

(b) If the household already has had a state hearing on the amount of the claim as a result of consolidation of the administrative disqualification hearing with the state hearing, the household shall be advised that they have no right to another state hearing on the amount of the claim.

(c) If there is an individual or organization that will provide free legal representation, the household shall be advised of the availability of these services.

(d) The household, or the sponsor shall be informed of the length of time the household has to decide which method of repayment it will choose and inform the CWD of its decision, and of the fact that the household's allotment will be reduced if the household fails to agree to make restitution.

(e) (Reserved)

(f) Claim collection will be from all adults who were in the household when the overpayment occurred.

(h) If the claim is not paid, it may be sent to other collection agencies that may use various methods to collect the claim.

(i) If not paid, the claim will be referred to the Federal government for collection. However, the household may make a written agreement to pay the claim amount prior to referral for Federal action.

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(j) If the claim is not received by the due date and becomes delinquent, the household may be subject to additional processing charges and will be subject to involuntary collection action(s).

(k) A due date or time frame to repay or make arrangements to repay the claim, unless the CWD will impose an allotment reduction. (If allotment reduction is to be imposed, the percentage to be used and effective date must be stated.)

(l) Any household or sponsor against which the CWD has initiate collection action shall be informed of their right to request renegotiation of any repayment schedule to which the household or the sponsor has agreed should the economic circumstances of the household or the sponsor undergo a change.

(1) A change in economic circumstances shall include, but not be limited to, changes in income, resources, or expenses. A change in household allotment shall not constitute a change in economic circumstances.

HANDBOOK BEGINS HERE

(m) The recommended CDSS developed forms to use for requesting repayment of claim determinations are the DFA 377.7B, the DFA 377.7D, and the DFA 377.7F.

HANDBOOK ENDS HERE

.432 If the household pays the claim, payments shall be accepted and submitted to CDSS in accordance with the procedures outlined in Section 63-801.8.

.44 Action Against Households and Sponsors of Alien Households Who Fail to Respond

.441 The CWD shall reduce the household's Food Stamp benefits without further notice as specified in Section 63-801.73, when:

(a) Collection action has been initiated against the household or the sponsor for repayment of a claim; and

(b) The household is currently participating in the Food Stamp Program; and

(c) The household does not respond to the notice of action requesting repayment within 30 days of the date the notice is mailed.

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.442 Other Collection Methods

(a) The CWD shall pursue other collection actions, as appropriate, to obtain restitution of a claim against any household or sponsor who fails to respond to a written demand letter for repayment of any IPV claim, unless the CWD can determine that such other actions are generally not cost effective.

(b) The CWD may also pursue other collection actions as appropriate, to obtain restitution of a claim against any household or sponsor who fails to respond to a written demand letter for repayment of any inadvertent household error, or administrative error claim.

(c) If the CWD chooses to pursue other collection actions and the household pays the claim, payments shall be submitted to CDSS as specified in Section 63-801.8. The CWD's retention of claim collections shall be based on the actual amount collected from the household through such collection actions excluding collection costs.

.45 Determining Delinquency of Claims

.451 Unless specified in Section 63-801.454, a claim shall be considered delinquent if:

(a) The claim has not been paid by the due date, and a satisfactory payment arrangement has not been made, or

(b) A payment arrangement has been established, and a scheduled payment has not been made by the due date.

.452 The date of delinquency for a claim covered under Section 63-801.451(a) is the due date on the initial written notification/demand letter. The claim will remain delinquent until payment is received in full, a satisfactory payment agreement is negotiated, or allotment reduction is invoked.

.453 The date of delinquency for a claim covered under Section 63-801.451(b) is the due date of the missed installment payment. The claim will remain delinquent until payment is received in full, allotment reduction is invoked, or the CWD determines to either resume or renegotiate the repayment schedule.

.454 A claim will not be considered delinquent if another claim for the same household is currently being paid either through an installment agreement or allotment reduction, and the CWD expects to begin collection on the claim once the prior claim(s) is settled.

.455 A claim is not subject to the requirement for delinquent debts if the CWD is unable to determine delinquency status because collection is coordinated through the court system.

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.5 Suspending and Terminating Collection of Claims

.51 Suspending Collection of Inadvertent Household and Administrative Error Claims

.511 If no collection action was initiated because of conditions specified in Section 63-801.411, the CWD shall be permitted to suspend an inadvertent household or administrative error claim.

.512 If collection action was initiated, and at least one demand letter has been sent, the CWD may be permitted to suspend further collection action of an inadvertent household error claim or of an administrative error claim against a nonparticipating household when:

(a) The household cannot be located; or

(b) The cost of further collection action is likely to exceed the amount that can be recovered.

.52 Suspending Collection of Intentional Program Violation Claims

.521 The CWD shall be permitted to suspend collection action on intentional Program violation claims at any time if it has documentation that the household and/or the sponsor cannot be located.

.522 If collection action was initiated, and demand letters as specified below sent, the CWD shall suspend further collection action on any intentional Program violation claim against a nonparticipating household or its sponsor when the cost of further collection action is likely to exceed the amount that can be recovered.

(a) At least one demand letter for claims of less than $100.

(b) At least two demand letters for claims between $100 and $400.

(c) At least three demand letters for claims of more than $400.

.53 Terminating Collection of Claims

The CWD shall be permitted to determine that a claim is uncollectible after it has been held in suspense for three years. The CWD shall use a suspended or terminated claim to offset a restoration of lost benefits in accordance with Section 63-802.54.

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.54 Claims Discharged Through Bankruptcy

CWDs shall act on behalf of, and as, FNS in any bankruptcy proceeding against bankrupt households owing food stamp claims. CWDs shall possess any rights, priorities, interests, liens or privileges, and shall participate in any distribution of assets, to the same extent as FNS. Acting as FNS, CWDs shall have the power and authority to file objections to discharge, proofs of claims, exceptions to discharge, petitions for revocation of discharge, and any other documents, motions or objections which FNS might have filed. Any amounts collected under this authority shall be transmitted to FNS as provided in Section 63-801.8.

.6 Change in Household Composition

.61 The CWD shall initiate collection action against any or all of the adult members of a household which received an overissuance for which an intentional Program violation, inadvertent household or administrative error claim was established in accordance with Section 63-801.1.

.611 If a change in household composition occurs, the CWD shall initiate collection action which may be taken against any or all households which contain an adult member who was an adult member of the original household that received an overissuance. The CWD may also offset the amount of the claim against restored benefits in accordance with Section 63-802.542.

.62 In pursuing claims, the CWD shall use any of the appropriate methods of collecting payments as specified in Sections 63-801.43 and 63-801.7. The CWD shall not collect more than the amount of the claim under any circumstances.

.7 Method of Collecting Payments

CWDs must accept any payment for a claim, whether it is a full or partial payment. As specified in Section 63-801.4, CWDs shall collect payments for claims against households as follows:

.71 Lump Sum

.711 If the household or the sponsor chooses to pay the claim at one time, the CWD shall collect a lump sum payment. The household shall not be required to liquidate all of its resources to make this one lump sum repayment.

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.712 If the household or the sponsor prefers to make a lump sum cash payment as partial payment of the claim, the CWD shall accept this method of payment.

.713 If the household or the sponsor chooses to make a lump sum payment of food stamp coupons as full or partial payment of the claim, the CWD shall accept this method of repayment.

.72 Installments

.721 The CWD shall negotiate a payment schedule with the household or the sponsor if the household or sponsor chooses this method for a full or partial repayment of the claim. Payments shall be accepted by the CWD in regular installments. The household may use food coupons as full or partial payment of any installment. A CWD shall use the full amount of the claim to offset any restoration of lost benefits due the household.

.722 If the household or the sponsor fails to make a payment in accordance with the established repayment schedule (either a lesser amount or no payment), the CWD shall notify the household or the sponsor that no payment or an insufficient payment was received.

(a) The notice of action requesting repayment shall inform the household or the sponsor that:

(1) They may contact the CWD to discuss renegotiation of the payment schedule; and

(2) Unless the overdue payments are made or the CWD is contacted to discuss renegotiation of the payment schedule, the benefits of a currently participating household with an established claim will be reduced without a further notice and as specified in Section 63-801.73.

(b) If the household, or the sponsor responds to the notice of action requesting repayment, the CWD shall take one of the following actions as appropriate:

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(1) If the household or the sponsor makes the overdue payments and wishes to continue payments based on the previous schedule, permit the household or the sponsor to do so;

(2) If the household or the sponsor requests renegotiation, and if the CWD concurs with the request, negotiate a new payment schedule;

(3) If the household or the sponsor requests renegotiation of the amount of its repayment schedule, but the economic circumstances of the household or the sponsor have not changed enough as specified in Section 63-801.431(l)(1) to warrant the requested settlement, the CWD may continue renegotiation until a settlement can be reached. The CWD may invoke allotment reduction against a currently participating household for repayment of an intentional Program violation claim if a settlement cannot be reached.

(c) If the household or the sponsor fails to respond, the CWD shall invoke allotment reduction. If allotment reduction is invoked, no further notice is required.

.723 In cases where the household is currently participating in the Food Stamp Program and a payment schedule is negotiated for repayment of a claim, the CWD shall ensure that the negotiated amount to be repaid each month through installment payments is not less than the amount which could be recovered through allotment reduction. Once negotiated, the amount to be repaid each month through installment payments shall remain unchanged regardless of subsequent changes in the household's monthly allotment. However, the CWD, the household, or the sponsor shall have the option to initiate renegotiation of the payment schedule if they believe that the economic circumstances of the household or the sponsor have changed enough to warrant such action.

.73 Reduction in Food Stamp Allotments

.731 CWDs shall collect repayments for a claim from a household currently participating in the Program by reducing the household's food stamp allotments as provided in Section 63-801.44.

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.732 Prior to reduction, the CWD shall send the household a DFA 377.7C, a DFA 377.7E, or a DFA 377.7G informing them of the appropriate formula specified in Section 63801.737, for determining the amount of food stamps to be recovered each month and the effect of that formula on the household's allotment (i.e., the amount of food stamps the CWD expects will be recovered each month), and of the availability of other methods of repayment.

.733 If the household requests to make a lump sum cash and/or food stamp coupon payment as full or partial payment of the claim, the CWD shall accept this method of payment. The CWD shall reduce the household's allotment as specified in Section 63-801.736, to recover any amounts of a claim not repaid through a lump sum cash and/or food stamp coupon payment, unless a payment schedule has been negotiated with the household.

.734 The provision in Section 63-503.325 for a $10 minimum benefit level for households with one and two members only, shall apply to the allotment prior to the reduction.

.735 The CWD shall use the full amount of the claim to offset any restoration of lost benefits.

.736 The amount of food stamps to be recovered each month through allotment reduction shall be determined in accordance with the following procedures and the calculated figure rounded as specified in Section 63-503.31.

(a) Inadvertent Household and Administrative Error Claims

For inadvertent household and administrative error claims, the amount of food stamps recovered shall be 10 percent of the household's monthly allotment or $10 per month, whichever is the greater amount.

(b) Intentional Program Violation Claims

For intentional Program violation claims, the amount of food stamps shall be 20 percent of the household's monthly allotment or $20 per month, whichever is the greater amount.

(QR) .737 Recoupment by Allotment Adjustment for QR Households

(QR) (a) O/I allotment adjustment shall only be initiated at the beginning of a quarter. However, an allotment adjustment shall be discontinued mid-quarter as appropriate when the O/I has been recouped.

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(QR) (b) When the CWD completes re-coupment of one O/I mid-quarter, the CWD may begin recoupment of the next O/I in mid-quarter as long as the amount being adjusted does not result in the benefits being decreased mid-quarter.

HANDBOOK BEGINS HERE

The following examples provide some guidance in the determination of O/Is in QR.

Late Mandatory Mid-Quarter Reporting: The recipient is in the April/May/June quarter. The mother is in a Public Assistance Food Stamp household of three and is convicted of a disqualifying drug felony on April 25 and reports the conviction on April 26. The report is considered timely, because it was made within 10 days. The CWD is unable to decrease benefits for May to reflect discontinuance of the ineligible household member, because there is insufficient time to provide 10-day notice. Benefits must be issued for May in the same amount that was issued in April, and the CWD must take action to decrease benefits effective June 1. The CWD shall not establish an O/I for the May allotment, because the recipient reported the change timely.

NOTE: For NAFS households, this is not a mandatory mid-quarter report. The county shall act to discontinue the mother upon timely and adequate notice based on the subsequent QR 7.

Late QR 7: In the July/August/September quarter, a recipient turns in her QR 7 on September 25. She reports starting a new job in August and indicates that she will receive $1,000 earnings each month. The CWD is unable to reduce cash aid and food stamp benefits for the October/November/December quarter effective October 1 due to inability to provide 10-day notice of the decrease resulting from increased income. The CWD is required to make the change effective November 1, and shall establish an O/I for food stamp benefits that were issued in error for October.

HANDBOOK CONTINUES

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Failure to Report Income: Looking back at the quarter designated as October/November/December, the CWD determines through an IEVS match that a CalWORKs AU and food stamp household had income that exceeded the IRT on December 26. The household is still receiving the same level of income in the current Jan/Feb/Mar quarter and has never reported the income as a mid-quarter report. The CWD determines that the household should have reported this change by January 5, and should have been discontinued due to ineligibility effective January 31. An O/I would be established beginning February 1.

CWD Failure to Act: The household reports on the QR 7 submitted March 5 that the father started a job on February 10. The income is expected to continue at the same level in the next QR Payment Quarter. The CWD failed to use the newly reported income to determine benefits for the next QR Payment Quarter (April/May/June). If using the income to compute the food stamp benefits should have resulted in a lower grant and allotment to the household, the CWD must establish an O/I for the amount the household was not entitled to receive beginning April 1.

HANDBOOK ENDS HERE

.74 Other Collection Actions

.741 CWDs may employ any other collection methods to collect claims. These actions include, but are not limited to, referrals to collection and/or similar private and public sector agencies, state tax refund and lottery offsets, wage garnishments, property liens, and small claims court.

.75 Unspecified Joint Collections

.751 When an unspecified joint collection is received for a combined public assistance/food stamp recipient claim, each program must receive its pro rata share of the amount collected. An unspecified joint collection is when funds are received in response to correspondence or a referral that contained both the food stamp and other program claim(s) and the debtor does not specify to which claim to apply the collection.

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.76 Unemployment Compensation Benefits

.761 Arrangements may be made to intercept the liable individual's unemployment compensation benefits to collect any claim. This collection may be included as part of a repayment agreement.

(a) Unemployment compensation benefits may be intercepted by obtaining a court order.

(b) Any intercept of unemployment compensation benefits must be reported as “cash” payments.

.77 Public Service

.771 If authorized by a court, the value of a claim may be paid by the household performing public service.

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.78 Interstate/Intercounty Claims Collection

.781 In cases where a household moves out of state, the CWD shall initiate or continue collection action against the household for any overissuance to the household which occurred while it was under the state's jurisdiction. The CWD which overissued benefits to the household shall have the first opportunity to collect any overissuance. However, if the CWD which overissued benefits to the household does not take action to collect as soon as administratively possible, then the government agency which administers the area into which the household moves may initiate action to collect the overissuance. Prior to initiating action to collect claims against households which have moved into the state, the CWD shall contact the agency which overissued benefits to ascertain that it does not intend to pursue prompt collection. Once the CWD accepts responsibility, claim collection incentive and reporting shall be retained by the CWD which collects the overissuance, regardless of whether the household remains in the state or not, and all interstate transfers shall be reported to FNS.

.782 In cases where a household moves from one county to another within the state and

(a) The household continues to receive food stamp benefits, the CWD in the former county of residence shall promptly transmit all overissuance information to the current county of residence. The current CWD shall initiate or continue the overissuance collection until repaid in full or the recipient moves to a subsequent county and that CWD takes responsibility for the collection of the overissuance, or

(b) The household no longer receives food stamp benefits, the last CWD responsible for the initiation or collection of the overissuance shall continue to collect the overissuance until repaid in full.

HANDBOOK BEGINS HERE

A household resides in County A and is not currently receiving food stamp benefits. However, there is an outstanding overissuance claim in which County A has established and is collecting against the household. Subsequently, the household moves to County B, applies for and receives food stamp benefits. County A still has an outstanding claim against the household. Upon issuance of food stamp benefits to the household by County B, County A promptly transmits all overissuance information to County B. County B shall now collect any outstanding overissuance in accordance with Section 63-801.

HANDBOOK ENDS HERE

.783 Claim collection incentives shall be paid to the CWD only for the overissuances recovered by that county.

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.8 Submission of Payments

.81 The CWD shall retain the value of funds collected for inadvertent household error, intentional Program violation, or administrative error claims. This amount includes the total value of allotment reductions to collect claims, but does not include the value of benefits not issued as a result of a household member being disqualified. The CWD's advance will be adjusted on a quarterly basis (calendar quarter) in an amount equal to the state and federal share of the quarterly intentional Program violation, inadvertent household error, and administrative error claim collections together with any adjustments for prior quarters.

.82 Each CWD shall submit, for each calendar quarter, a FNS-209.

.821 A completed FNS-209 is due no later than 30 days after the end of each calendar year quarter and shall be submitted to CDSS even if the CWD has not collected any payments. Failure to submit the FNS-209 to CDSS in a timely manner or in a fully completed format may result in a temporary suspension of a portion of the CWD's advance.

.822 In addition to reporting the amount of funds recovered from inadvertent household error, intentional Program violation and administrative error claims each quarter on the FNS-209, the CWD shall also report these amounts on other documents as required by CDSS regulations.

.823 In accounting for claims collections, the CWD shall include cash or coupon repayments and the value of allotments recovered or offset by the restoration of lost benefits. The value of benefits not issued as a result of a household member being disqualified, shall not be considered recovered allotments and shall not be used to offset an intentional Program violation claim.

.83 Collections from claims established as inadvertent household errors prior to the determination of intentional Program violation shall be handled as follows:

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.831 After a determination of intentional Program violation is made, the CWD may retain any amounts recovered on a claim being handled as an inadvertent household error claim at the incentive rate applicable for intentional Program violation claims. Prior to the determination of intentional Program violation, the claim retention amount shall be at the rate applicable to inadvertent household error claims.

.84 If a household has overpaid a claim, the CWD shall pay the household any amounts overpaid as soon as administratively possible, but not later than 10 days after the overpayment becomes known.

.841 The household shall be paid by cash or coupons as the CWD deems appropriate considering the household's circumstances.

.842 Overpaid amounts of a claim, which have been reported as collections on a prior FNS-209 and which have been repaid to the household, shall be reported on the FNS-209 for the quarter in which the repayment occurred.

.85 Returned Coupons

The CWD may return to inventory any coupon books which are received, intact and in usable form, from households as payment for claims, as specified in Section 63-706.3. The CWD shall destroy any coupons or coupon books which are not returned to inventory as specified in Section 63-706.1.

.851 The CWD shall require the collection points to complete a FNS-135 as verification for receipt of coupons returned as payment of a claim.

.852 The CWD shall require the collection points to void, immediately upon receipt, any coupons collected as payment and not returned to inventory, and either send the coupons to a coupon destruction point or hold the subject coupons in secure storage pending examination and destruction by the CWD at the claims collection point.

.853 Repealed by Manual Letter No. FS-91-03, effective 3/1/91.

.854 Repealed by Manual Letter No. FS-91-03, effective 3/1/91.

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.86 In cases where FNS has billed CDSS for CWD negligence, FNS will credit any amounts collected from households which were caused by the CWD's negligence.

HANDBOOK ENDS HERE

.9 Accounting Procedures

Each CWD shall maintain an accounting system for monitoring claims against households. At a minimum, the accounting system shall be designed to readily accomplish the following:

.91 Identify claims by categories of inadvertent household error, administrative error, and intentional Program violations.

.92 Provide data necessary to complete the FNS-209.

.93 Document the circumstances which resulted in a claim, the procedures used to calculate the claim, the methods used to collect the claim and, if applicable, the circumstances which resulted in suspension or termination of collection action.

.94 Identify those situations in which an amount not yet restored to a household as a restoration of lost benefits can be used to offset a claim owed by the household.

.95 Identify those households that have failed to make installment payments on their claims.

.96 Document how much money was collected in payment of a claim and how much was submitted to CDSS through an adjustment of the CWD's advance.

.97 Identify, at certification, households that owe outstanding payments on a previously established claim determination. The initial allotment shall not be reduced to offset claims. Actions on identified claims shall be as specified in Section 63-801.4.

NOTE: Authority cited: Sections 10554, 11265.1, .2 and.3, 18901.3, 18904, and 18910, Welfare and Institutions Code. Reference: Sections 10554, 11265.1, .2, and .3, 18901.3, 18904, and 18910, Welfare and Institutions Code; 7 CFR 271.2; 7 CFR 273.18, 7 CFR 273.18(a), (a)(1)(ii), and (a)(2); 7 CFR 273.18(b)(3); 7 CFR 273.18(c)(1)(i), (c)(1)(ii), (ii)(b), and (c)(2)(ii) (Federal Register, Vol. 58, No. 209, pp. 58454 and 58455, dated November 1, 1993); 7 CFR 273.18(d)(4)(iii); 7 CFR 273.18(e)(1); 7 CFR 273.18(e)(3)(iv); 7 CFR 273.18(e)(3)(v); 7 CFR 273.18(e)(5)(v); 7 CFR 273.18(e)(6)(ii); 7 CFR 273.18(e)(7)(i); 7 CFR 273.18(f); 7 CFR 273.18(g)(4)(ii); 7 CFR 273.18(g)(6); 7 CFR 273.18(g)(8); 7 CFR 273.18(g)(9); 7 CFR 273.18(h)(4); 7 CFR 273.18(i); 7 CFR 273.18(k)(5); 7 CFR 273.18(n)(1)(i); 7 U.S.C. 2022(a)(1); U.S.D.A., Food and Nutrition Service letter WFS-100:FS-10-6-CA, dated October 7, 1991; Food and Nutrition Service Quarterly Reporting/Prospective Budgeting waiver approval dated April 1, 2003; P.L. 104-193, Sections 809 and 844 (Personal Responsibility and Work Opportunity Reconciliation Act of 1996) and Lomeli v. Saenz, Sacramento Superior Court, Case #98CS01747.

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