406 U.S. 535 (1972), 70-5064, Jefferson v. Hackney
|Docket Nº:||No. 70-5064|
|Citation:||406 U.S. 535, 92 S.Ct. 1724, 32 L.Ed.2d 285|
|Party Name:||Jefferson v. Hackney|
|Case Date:||May 30, 1972|
|Court:||United States Supreme Court|
Argued February 22, 1972
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
Appellants, recipients of Aid to Families With Dependent Children (AFDC), challenge the system whereby Texas, in order to allocate its fixed pool of welfare money among persons with acknowledged need, applies a percentage reduction factor to arrive at a reduced standard of need, the factor being lower for AFDC than for other categorical assistance programs. Appellants assert that the State's method of applying this factor to recipients with outside income contravenes § 402(a)(23) of the Social Security Act, which required adjustment, by July 1, 1969, of "amounts used . . . to determine the needs of individuals" to reflect increases in living costs, because this method does not increase the welfare rolls to the same extent as would an alternative procedure used by some other States. They also make an equal protection claim on the grounds that the distinction between the aid programs is not rational, and that the Texas system racially discriminates against the proportionately larger number of minority groups in AFDC than in the other programs.
1. The Texas scheme does not contravene § 402(a)(23) of the Social Security Act, which does not require use of a computation procedure that maximizes individual eligibility for subsidiary benefits. Pp. 539-545.
2. The challenged system does not violate the Equal Protection Clause of the Fourteenth Amendment. Pp. 545-551.
(a) The fact that there are more members of minority groups in the AFDC program than in other categories does not indicate racial discrimination, absent any proof of racial motivation in the Texas scheme. There was no such proof here. Pp. 547-549.
(b) Texas' decision to provide somewhat lower welfare benefits for AFDC recipients than for the aged and infirm who are in other categories is not invidious or irrational, and there is no constitutional or statutory requirement that relief categories be treated exactly alike. Pp. 549-551.
REHNQUIST, J., delivered the opinion of the Court, in which BURGER, C.J., and WHITE, BLACKMUN, and POWELL, JJ., joined. STEWART, J., filed a statement joining in Part III of the Court's opinion, post, p. 551. DOUGLAS, J., filed a dissenting opinion, in which BRENNAN, J., joined, post, p. 551. MARSHALL, J., filed a dissenting opinion, in which BRENNAN, J., joined, and in Part I of which STEWART, J., joined, post, p. 558.
REHNQUIST, J., lead opinion
MR. JUSTICE REHNQUIST delivered the opinion of the Court.
Appellants in this case challenge certain computation procedures that the State of Texas uses in its federally assisted welfare program. Believing that neither the Constitution nor the federal welfare statute prohibits the State from adopting these policies, we affirm the judgment of the three-judge court below upholding the state procedures.
Appellants are Texas recipients of Aid to Families With Dependent Children (AFDC). They brought two class
actions, which were consolidated in the United States District Court for the Northern District of Texas, seeking injunctive and declaratory relief against state welfare officials. A three-judge court was convened pursuant to 28 U.S.C. § 2281.
The Texas State Constitution provides a ceiling on the amount the State can spend on welfare assistance grants.1 In order to allocate this fixed pool [92 S.Ct. 1727] of welfare money among the numerous individuals with acknowledged need, the State has adopted a system of percentage grants. Under this system the State first computes the monetary needs of individuals eligible for relief under each of the federally aided categorical assistance programs.2 Then, since the constitutional ceiling on welfare is insufficient to bring each recipient up to this full standard of need, the State applies a percentage reduction factor3 in order to arrive at a reduced standard of need in each category that the State can guarantee.
Appellants challenge the constitutionality of applying a lower percentage reduction factor to AFDC than to
the other categorical assistance programs. They claim a violation of equal protection because the proportion of AFDC recipients who are black or Mexican-American is higher than the proportion of the aged, blind, or disabled welfare recipients who fall within these minority groups. Appellants claim that the distinction between the programs is not rationally related to the purposes of the Social Security Act, and violates the Fourteenth Amendment for that reason as well. In their original complaint, appellants also argued that any percentage reduction system violated § 402(a)(23) of the Social Security Act of 1935, as amended, 81 Stat. 898, 42 U.S.C. § 602(a)(23), which required each State to make certain cost of living adjustments to its standard of need.
The three-judge court rejected appellants' constitutional arguments, finding that the Texas system is neither racially discriminatory nor unconstitutionally arbitrary. The court did, however, accept the statutory claim that Texas' percentage reductions in the AFDC program violate the congressional command of § 402(a)(23). 304 F.Supp. 1332 (ND Tex.1969).
Subsequent to that judgment, this Court decided Rosado v. Wyman, 397 U.S. 397 (1970). Rosado held that, although 402(a)(23) required States to make cost of living adjustments in their standard of need calculations, it did not prohibit use of percentage reduction systems that limited the amount of welfare assistance actually paid. 397 U.S. at 413. This Court then vacated and remanded the first Jefferson judgment for further proceedings consistent with Rosado. 397 U.S. 821 (1970).
On remand, the District Court entered a new judgment, denying all relief. Then, in a motion to amend the judgment, appellants raised a new statutory claim. They argued for the first time that, although a percentage reduction system may be consistent with the statute, the
specific procedures that Texas uses for computing that reduction violate the congressional enactment. The District Court rejected this argument and denied without opinion appellants' motion to amend the judgment. This appeal under 28 U.S.C. § 1253 then followed, and we noted probable jurisdiction. 404 U.S. 820 (1971).
Appellants' statutory argument relates to the method that the State uses to compute the percentage reduction when the recipient also has some outside income. Texas, like many other States,4 first applies the percentage reduction factor to the recipient's standard of need, thus arriving at a reduced standard of need that the State can guarantee for each recipient within the present budgetary restraints. After computing this reduced standard of need, the State then subtracts any nonexempt5 income in order to arrive at the level of benefits that the recipient needs in order to reach his reduced standard of need. This is the amount of welfare the recipient is given.
Under an alternative system used by other States, the order of computation is reversed. First, the outside income is subtracted from the standard of need, in order to determine the recipient's "unmet need." Then the percentage reduction factor is applied to the unmet need in order to determine the welfare benefits payable.
The two systems of accounting for outside income yield different results.6 Under the Texas system, all
welfare recipients with the same needs have the same amount of money available each month, whether or not they have outside income. Since the outside income is applied dollar for dollar to the reduced standard of need, which the welfare department would otherwise pay in full, it does not result in a net improvement in the financial position of the recipient. Under the alternative system, on the other hand, any welfare recipient who also has outside income is in a better financial position because of it. The reason is that the percentage reduction factor there is applied to the "unmet need," after the income has been subtracted. Thus, in effect, the income-earning recipient is able to "keep" all his income, while he receives only a percentage of the remainder of his standard of need.7
[92 S.Ct. 1729] Each of the two systems has certain advantages. Appellants note that, under the alternative system, there is a financial incentive for welfare recipients to obtain outside income. The Texas computation method eliminates any such financial incentive, so long as the outside income remains less than the recipient's reduced standard of need.8 However, since Texas' pool of available welfare funds is fixed, any increase in benefits paid to the working poor would have to be offset by reductions elsewhere. Thus, if Texas were to switch to the alternative system of recognizing outside income, it would be forced to lower its percentage reduction factor, in order to keep down its welfare budget. Lowering the percentage would result in less money for those who need the welfare benefits the most -- those with no outside income -- and the State has been unwilling to do this.
Striking the proper balance between these competing policy considerations is, of course, not the function of this Court.
There is no question that States have considerable latitude in allocating their AFDC resources, since each State is free to set its own standard of need and to determine the level of benefits by the amount of funds it devotes to the program.
King v. Smith, 392 U.S. 309, 318-319 (1968) (footnotes omitted).9 So long as the...
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