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503.1 - 503.2 TANF MANUAL 12/21 Page 1

503.1 DEFINITION OF IMPROPER PAYMENT - A TANF payment made by a local department is improper when the payment is incorrect because: (1) the assistance unit does not meet eligibility requirements in the category (payment received in error/payment to an ineligible case); or (2) payment is in an amount greater than the amount to which the assistance unit is entitled under established guidance (overpayment); or (3) payment is in an amount less than the amount to which the assistance unit is entitled under established guidance (underpayment); or (4) a VIEW participant is found to have committed an IPV for receiving a payment or purchase on his behalf which is in an amount greater than what he is eligible for or for which he is ineligible.*

Note: TANF payments also include Emergency Assistance payments, Diversionary Assistance payments, VIEW Transitional Payments, and VIEW payments and services when a VIEW participant is found to have committed an IPV for receiving a payment or purchase on his behalf which is an amount greater than what he is eligible for or for which he is ineligible.

Improper payments may occur as a result of overdue reviews or other agency errors or because of erroneous or incomplete information supplied by the client. Improper payments may be revealed by several sources, not necessarily limited to the following: Local Agency Reviews, Federal Program Reviews, Fair Hearings, or earnings reports furnished by the Virginia Employment Commission. 503.2

503.2 STATUTORY PROVISIONS FOR REFUND OF OVERPAYMENTS AND PAYMENTS - If a payment or overpayment is made to an individual who is ineligible, the amount of such overpayment shall be returned to the Virginia Department of Social Services by the locality. Repayments will not be required if the Department determines that the payments or overpayments are the result of vague or conflicting regulations issued by the Department, or the failure of the Department to make statutes, rules, regulations, and guidance decisions available to the locality in a timely manner. Repayments will not be required in situations in which the locality exercised due diligence, yet received incomplete or incorrect information from the client which caused the overpayment. If a locality fails to return an overpayment as required, the Department of Social Services shall withhold an equal amount from the next disbursement made by the Department to the locality.*

The criteria used for determining if a locality exercised due diligence are as follows:

A. A redetermination was not outstanding (overdue) in the case in question because the agency has received permission from the State to suspend reviews.

B. The error had not occurred at the time of the completion of a scheduled review.

C. It can be shown that the error was the result of the client willfully withholding information which would not have been discovered by verifications required at the time of the review.

D. The error was not the result of an anticipated change that was overlooked.

E. The error was not the result of the client reporting a change that the agency failed to follow-up on.

F. The error was not the result of failure to use available management tools. The case record must be thoroughly documented regarding efforts to obtain all necessary information.

* 2002, Acts of Assembly, Chapter 899, Item 362 (Budget Bill, HB30.)

TANF Transmittal 74