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(i) For each month that a household received an overissuance due to an inadvertent household error or administrative error, the social services district which issued the food stamps must determine the correct amount of food stamp benefits the household was entitled to receive. The amount of the inadvertent household or administrative error claim must be calculated based on the amount of the overissuance which occurred during the 12 months preceding the date the overissuance was discovered. In cases involving reported changes, the social services district must determine the month the overissuance initially occurred as follows:
(a) If, due to an inadvertent error on the part of the household, the household failed to report a change in its circumstances within the required timeframes, the first month affected by the household's failure to report is the first month in which the change would have been effective had it been timely reported. However, in no event may the social services district 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.
(b) If the household timely reported a change but the social services district did not act on the change within the required timeframes, the first month affected by the district's failure to act is the first month the district would have made the change effective had it acted timely. However, in no event may the social services district 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. If a notice of adverse action was required but not provided, the social services district must assume for the purpose of calculating the claim that the maximum advance notice period would have expired without the household requesting a fair hearing under Part 358 of the Title.