Dickenson v. Petit, Civ. No. 82-0041-B.

CourtUnited States District Courts. 1st Circuit. United States District Court (Maine)
Writing for the CourtCYR
Citation536 F. Supp. 1100
PartiesBrenda DICKENSON, et al., Plaintiffs, v. Michael PETIT, Defendant.
Docket NumberCiv. No. 82-0041-B.
Decision Date19 March 1982

Kathleen Caldwell, Solomon Goldman, Hugh Calkins, Pine Tree Legal, Bangor, Me., Robert Mittel, Portland, Me., for plaintiffs.

James E. Smith, Katherine Greason, Asst. Atty. Gen., Augusta, Me., for defendant.


CYR, District Judge.

This civil rights suit arises under 42 U.S.C. § 1983 as a result of official actions taken by the defendant, Michael Petit, Commissioner of the Maine Department of Human Services Commissioner, in the implementation of the Maine Aid to Families with Dependent Children AFDC program as a consequence of the enactment of the Omnibus Budget Reconciliation Act O. B. R. A., Public Law 97-35, 95 Stat. 357, made generally effective October 1, 1981. In behalf of themselves and their minor children, the individual plaintiffs,1 proceeding in forma pauperis, request preliminary injunctive relief prospectively restraining the Commissioner from terminating or reducing their AFDC benefits and those of similarly-situated class members under emergency rules and regulations adopted by the Commissioner on November 1, 1981, effective January 1, 1982. The thrust of their contentions is twofold. First, that the requirements of the Maine Administrative Procedure Act, 5 M.R.S.A. § 8001 et seq., A.P.A., were not complied with as of January 1, 1982, thereby invalidating amendments to the Maine Public Assistance Payments Manual MPAPM purporting to implement the changes mandated by O. B. R. A. Second, that certain rules and regulations contained in the amended MPAPM fail to conform with federal requirements.

The jurisdiction of the court is founded on 28 U.S.C. §§ 1331 & 1343(3) and 42 U.S.C. § 1983. Plaintiffs invoke the court's pendent jurisdiction of their state-law claims as well.

The complaint was filed on February 10, 1982 and amended on February 17, 1982. The court met and conferred with counsel on February 19, 1982 and heard the application for preliminary injunctive relief on February 24, 1982. At that hearing, oral argument but no testimonial evidence was presented. The Commissioner moved on February 24, 1982, without objection, to join the United States Department of Health and Human Services H.H.S., the department charged with administering the AFDC program at the federal level. H.H.S. was not represented at either the conference or the hearing.

Plaintiffs seek to maintain the action as a class action under Fed.R.Civ.P. 23, without objection by the Commissioner, under a jointly proposed class definition.2 The record includes several affidavits, stipulations of fact, as well as a stipulation relating to documentary materials.

A. General Background

The AFDC program was created by Congress in 1935 under Title IV, Part A, of the Social Security Act, 49 Stat. 627, codified at 42 U.S.C. §§ 601-676. The program is one of several joint federal-state public assistance programs and is intended to promote the care of needy dependent children in their own homes or in the homes of their relatives. The program has a related purpose of assisting parents or relatives, with whom such children live, to attain self-sufficiency. See 42 U.S.C. § 601.

Under the AFDC program, benefits are paid and administered by states electing to participate in the program. In order to participate, however, a state must first obtain approval of its state plan by H.H.S. and the plan must conform with federal law and with the implementing H.H.S. regulations. 42 U.S.C. § 604. Cf. 22 M.R.S.A. § 3741. If a state receives approval of its plan it can obtain reimbursements from the federal government for a percentage of the benefits paid and administrative expenses incurred. See 42 U.S.C. § 603.

The State of Maine participates in the AFDC program. The Maine Department of Human Services D.H.S. administers and operates the AFDC program in Maine. 22 M.R.S.A. § 3741 et seq. D.H.S. promulgates the Maine Public Assistance Payments Manual MPAPM which sets out the regulatory scheme under which the Maine AFDC program functions. The MPAPM is a rule within the meaning of the A.P.A. See 5 M.R.S.A. § 8002(9)(A).

Plaintiffs contend that the method that the State of Maine began using February 1, 1982 for calculating AFDC-recipient income contravenes federal law by including within the definition of "income," taxes withheld from earned income. Plaintiffs further contend that many Maine AFDC recipients have been unlawfully denied benefits because D.H.S. has not applied the so-called "$30 plus 1/3 " disregard to recipients for four months following the adoption of the amended MPAPM.

B. Federal Law Prior to O. B. R. A.

Since the AFDC program is intended to provide assistance only to "needy" families and in an amount limited by the extent of their "need," AFDC statutory provisions and H.H.S. regulations have required that the determination of AFDC eligibility is to be made by reference to family "income and resources," and that the calculation of the amount of the monthly AFDC grant is to be made by comparing the income of the family, after certain deductions, to the so-called "standard of need," which "reflects the state's view of the amount necessary to provide for the essential needs, such as food, clothing, and shelter, of a hypothetical family in question." Ram v. Blum, 533 F.Supp. 933, 937 (S.D.N.Y.1982).

Thus, prior to the August 13, 1981 enactment of O. B. R. A., section 402(a)(7) of the Social Security Act, 42 U.S.C. § 602(a)(7),3 provided that the states, in determining the need of an AFDC recipient, should

except as may be otherwise provided in clause (8), ... take into consideration any other income and resources of any child or relative claiming aid to families with dependent children ... as well as any expenses reasonably attributable to the earning of any such income....

Clause (8), under the pre-O. B. R. A. version of section 402(a), required that the states, in making the determination required under clause (7), subject to certain exceptions not here applicable, see 42 U.S.C. § 602(a)(8)(C) & (D) (1980), disregard in any month:

1. all of the earned income of student dependent children receiving aid, 42 U.S.C. § 602(a)(8)(A)(i) (1980); and
2. $30 of the total of earned income of nonstudent dependent children receiving aid, relatives receiving aid, and any other individual whose needs are considered in making the determination under clause (7), plus one-third of the remainder of such income, 42 U.S.C. § 602(a)(8)(A)(ii) (1980).

Clause (8) also permitted the states, subject to limitations prescribed by H.H.S., to permit all or portions of earned or other income to be set aside for future identifiable needs of a dependent child or to disregard an additional $5 per month. 42 U.S.C. § 602(a)(8)(B) (1980). Clause (8) also forbade the states from disregarding earned income in any particular month if the income of the person whose income was considered exceeded his or her need, as determined under clause (7) without regard to clause (8), unless "for any one of the four months preceding such month, the needs of such persons were met by the furnishing of aid under the plan." 42 U.S.C. § 602(a)(8)(D) (1980).

C. MPAPM Prior to O. B. R. A.

In accordance with the pre-O. B. R. A. AFDC statutes and regulations, the MPAPM, in its pre-February 5, 1982 form, contained a 12-page section entitled "Income," which provided that the "income which is available will be considered as a resource in the determination of the assistance payment." MPAPM, Chapter II, § C, p. 1. "Available income is defined as that income which is received and under the control of the client (or his guardian or conservator) during the period for which need is being determined." Id. "Potential income is defined as that income which could be received if action were taken to obtain it (e.g., social security, unemployment compensation, V. A. benefits, etc.), ... and will not be considered in determining the amount of assistance payment until it is received." Id. Following these definitions, the MPAPM defined two types of income — "unearned income" and "earned income." "Earned income is income produced by the labor or services of an individual." Id. After a lengthy subsection defining anticipated income, the MPAPM contained a subsection entitled "Incentive Disregards of Earned Income," which dealt with the earnings disregard for student AFDC recipients and with the disregard of $30 plus one-third of the remainder of income earned by others whose needs were to be considered in computing the assistance grant. Id. at 8-9. The next subsection of the MPAPM, entitled "Method of Determining Work Related Expenses and Applying Incentive Disregards," listed twelve work-related expenses, including

a. Deductions for Social Security or any other retirement benefits;
b. Federal Income Tax deductions as withheld; and
c. State Income Tax deductions as withheld.

These three items were listed in MPAPM along with union dues, costs of special uniforms, costs of special tools, costs of lunches required to be purchased away from home, costs of transportation to and from work, mandatory health and/or life insurance premiums, child-care costs, travel costs and costs of using the home as a work headquarters. See MPAPM, Chapter II, § C, pp. 9-11, (pre-February 5, 1982). After listing these "expenses," MPAPM provided: "The net amount remaining plus all unearned income will be considered in determining eligibility and grant amount." This subsection also set out the steps to determine eligibility for AFDC:

1. Subtract appropriate work related expenses from earned income.
2. Add the balance to `unearned income.'
3. Subtract the total from `total requirements,' (full need).
4. If the total of (1) and (2) is less than `total requirement', (full need), the

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12 cases
  • James v. O'Bannon, 82-1438
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • 14 Septiembre 1983
    ...issue show, the language of sections 602(a)(7) & (a)(8) has been subject to differing interpretations. See, e.g., Dickenson v. Petit, 536 F.Supp. 1100, 1111 (D.Me.1982) (in holding that tax withholdings are encompassed in work expense disregard and not to be deducted separately, the court a......
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    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
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    ...Board directives and subsequent HHS regulations with a novel argument based on the recent district court holding in Dickenson v. Petit, 536 F.Supp. 1100 (D.Me.), aff'd on other grounds, 692 F.2d 177 (1st Cir.1982). According to the Secretary's argument, the concept of "availability" is mean......
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    • 15 Octubre 1982
    ...first three steps to decrease the working recipient's grant. RAM v. Blum, 533 F.Supp. 933 at 942 (S.D.N.Y. 1982); Dickenson v. Petit, 536 F.Supp. 1100 at 1105-06 (D.Me.1982); James v. O'Bannon, 557 F.Supp. 631 at 635 (E.D.Penn.1982). The precise meanings of two of the terms of art used in t......
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    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
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    ...of benefits to determine the exact grant payment which will be made to the recipient. RAM I, 533 F.Supp. at 942; Dickenson v. Petit, 536 F.Supp. 1100, 1105-06 Within this calculation framework, the parties disagree about the meaning of two key terms: "income" and "work expenses." After the ......
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