Brown v. Bates

• Decision Date: 21 September 1973
• Docket Number: Civ. No. C 72-217.
• Citation: 363 F. Supp. 897
• Parties: Bessie BROWN et al., Plaintiffs, v. Charles W. BATES et al., Defendants.
• Court: U.S. District Court — Northern District of Ohio

363 F. Supp. 897

Bessie BROWN et al., Plaintiffs, v.Charles W. BATES et al., Defendants.

Civ. No. C 72-217.

United States District Court, N. D. Ohio, W. D.

September 21, 1973.

James M. Klein, Thomas E. Willging, Toledo, Ohio, for plaintiffs.

Kevin Duffey, Columbus, Ohio, for defendants.

OPINION

DON J. YOUNG, District Judge:

This cause came to be heard upon motion of the plaintiffs for summary judgment and upon cross motion of the defendants for summary judgment, both pursuant to Rule 56, Fed.R.Civ.P.The parties state to the Court that there is no genuine issue as to any material fact and the Court finds the case in the proper posture for ruling under the provisions of Rule 56.Counsel on both sides have ably represented their clients' positions.

This is a case of first impression which has evolved from the following fact situation.Plaintiffs, in this class action,¹ are recipients of aid from what is commonly referred to as "categorical public assistance programs" of the Social Security Act(Old Age Assistance OAA, 42 U.S.C. §§ 301-306;Aid to the Blind AB, 42 U.S.C. §§ 1201-1206;Aid to Families with Dependent Children AFDC, 42 U.S.C. §§ 601-610; and Aid to the Permanently and Totally Disabled APTD, 42 U.S.C. §§ 1351-1355), who also attend college on a full time basis, and participate in the Federal Work Study Program, 42 U.S.C. § 2751 et seq.

The categorical assistance programs are funded by the federal and state governments on a matching basis and are administered by the state, subject to federal laws and regulations.The Work-Study Program is funded directly by the federal government, and is administered, on a local level, by the colleges and universities which participate in the program.

The plaintiffs seek to enjoin the Ohio Department of Public Welfare from treating monies received by categorical assistance recipients under the Work-Study Program as available income, and thereby reducing the recipients' monthly grants from the categorical assistance programs.

I.

Congress has provided, in pertinent part, that:

A state plan for aid and services to needy families . . . (7) except as may otherwise be provided in clause (8), provide that the State agency shall, in determining need, take into consideration any other income and resources of any child or relative claiming aid to families with dependent children . . . .42 U.S.C. § 602(a)(7)²

The Federal Regulations,45 C.F.R. § 233.20 et seq., in giving guidance in implementing the provisions of the categorical assistance programs provide in pertinent part:³

Requirements for State Plans.A State Plan for OAA, AFDC, AB, APTD or AABD must, as specified below:

(1)General.Provide that the determination of need and amount of assistance for all applicants and recipients will be made on an objective and equitable basis and all types of income will be taken into consideration in the same way, except where otherwise specifically authorized by Federal statute. . . .

(3)(ii) Provide that, in establishing financial eligibility and the amount of the assistance payment: . . . (c) only such net income as is actually available for current use on a regular basis will be considered and only currently available resources will be considered . . . .

(3)(iv) Provide that, in determining the availability of income and resources, the following will not be included as income: . . . (b) loans and grants, such as scholarships, obtained and used under conditions that preclude their use for current living costs. . . .

The Ohio Department of Public Welfare has interpreted Section 405⁴ of Ohio Public Assistance Manual to include funds received by participation in the Federal Work-Study Program and has in essence declared the funds to be "available income" which must be taken into consideration in determining the amount of assistance to be granted recipients of categorical assistance programs.45 C. F.R. § 233.20(a)(1).Plaintiffs seek to enjoin the Ohio Departnent of Public Welfare from treating the Work-Study monies as available income.

II.

The Court is first faced with determining whether the monies received under the Work-Study Program are a grant under the provisions of 45 C.F.R. § 233.20(a)(3)(iv)(b).The term "grant"⁵ does not lend itself to a precise definition that can be applied in all situations.Rather its meaning is to be determined from its connection and the manner of its use.Bainton v. Clark Equipment Co., 210 Mich. 602, 178 N.W. 51(1920).The Court, therefore, must look to the purpose of the Work-Study Program and how the program is administered to determine if it meets the provisions of 45 C.F.R. § 233.20(a)(3)(iv)(b).

The Work-Study Program is merely one part of a more general program⁶ that Congress has established to provide financial assistance to needy students who desire to obtain higher education.Selection of students to participate in the Work-Study Program, which provides employment for those selected, is distinct from employment generally.The individual selected must maintain his status as a student at an eligible institution, 42 U.S.C. § 2754; the student must meet the financial eligibility requirements of demonstrating that he is in need of the earnings from such employment in order to pursue a course of study at such institution, Id. at § 2754(a)(3)(1); his wages are paid up to eighty percent (80%) by the federal government, Id. at § 2754(a)(6); and the institutions participating in the program must make the program reasonably available to all eligible students, Id. at § 2754(a)(7).

The differences between employment under the Work-Study Program and employment in general leads the Court to believe that first, student participation in the program is brought about by qualifying under financial requirements established by the federal government to earn wages paid from funds which are provided, up to eighty percent (80%), by the federal government.Second, and equally important, the participants in the program must maintain student status and the funds, as stated by Congress, "shall be furnished only to a student who is in need of the earnings from such employment in order to pursue a course of study at an institution,"42 U.S.C. § 2754(a)(3)(1).This precludes the use of the funds for current living costs since the recipient must be a student and also show that he needs the funds to continue his education.The Court, based upon the language of the statute, cannot find that the monies earned are for current living costs but rather for the extraordinary costs of being a student.Therefore, on the basis of the money earned being heavily subsidized by federal grants and that the recipients of the monies must maintain the unique status of student and apply the monies toward their education, the Court comes to the conclusion that the Work-Study Program is a grant within the meaning of 45 C.F.R. § 233.20(a)(3)(iv)(b).

III.

The Court will now focus on 45 C.F.R. § 233.20(a)(3)(ii)(c) which states:

Provided that, in establishing financial eligibility and the amount of assistance payment: . . . only such net income as is actually available for current use on a regular basis will be considered, and only currently available resources will be considered.

The defendants argue that the language of the Regulation is clear and if the Court prohibits the Ohio Department of Public Welfare from excluding the monies from the Work-Study Program as available income, the Court is legislating rather than interpreting.The defendants further buttress their argument by citing Daniels v. Thompson, 269 A.2d 437(1970) in which the District of Columbia Court of Appeals held that the funds received under the "Stay-in-School" program could not be excluded as available income in determining the amount entitled to under AFDC grants, 42 U.S.C. § 602.

Plaintiffs, in response to the defendants' second argument, contend that the case is inapposite since the Daniels Court was not faced with the issue of determining Congressional intent under the Work-Study Program.This Court agrees that the legal issues between the instant case and the Daniels case are dissimilar and further, this Court does not choose to follow the reasoning of the Daniels Court on issues that are similar.

In returning to defendants' first argument, the Court disagrees with the defendants' contention.The Court is not legislating but rather interpreting the Federal Regulations in the light of the Congressional purpose in enacting the categorical assistance program and the Work-Study Program.It seems clear that the categorical assistance programs were enacted to provide "aid and services to the needy", 42 U.S.C. § 602.Income earned while receiving funds under these programs is disregarded to a certain extent based upon a formula provided in the Code of Federal Regulations⁷ and the remaining income is "available income" to be taken into consideration in calculating the extent of assistance a recipient is entitled to.⁸The Work-Study Program, on the other hand, was enacted by Congress to provide funds, obtained through employment with private non-profit or public institutions, for needy students who desire higher education.⁹Basically, its purpose is to equip the needy with the education and training that will enable them ultimately to meet their needs by their own efforts, rather than depending upon governmental largesse.

The Court believes that the available income Congress intended to be included in determining the amount of assistance a recipient was to receive is income earned in permanent employment situations and for static needs, such as food, clothing and shelter.The monies earned by participating in the Work-Study Program do not qualify under either criteria.The participant must maintain student status to be eligible for the program and even in this day of protracted higher education programs one cannot consider employment based on student status as permanent.Further, although the...