Johnson v. Harder

• Decision Date: 11 October 1974
• Docket Number: Civ. No. 13765.
• Parties: Cleo JOHNSON, Individually and on behalf of her minor dependent children and in behalf of all others similarly situated v. John HARDER, Commissioner of the Connecticut State Welfare Department.
• Court: U.S. District Court — District of Connecticut

383 F. Supp. 174

Cleo JOHNSON, Individually and on behalf of her minor dependent children and in behalf of all others similarly situated v. John HARDER, Commissioner of the Connecticut State Welfare Department.

Civ. No. 13765.

United States District Court, D. Connecticut.

October 11, 1974.

Norman J. Johnson, Victor M. Ferrante, Jr., Waterbury Legal Aid, Waterbury, Conn., for plaintiff.

James M. Higgins, Michael A. Arcari, Asst. Attys. Gen., East Hartford, Conn., for defendant.

MEMORANDUM OF DECISION ON PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT

BLUMENFELD, District Judge.

This case involves a Connecticut welfare regulation which provides that OASDI (Old Age, Survivors, and Disability Insurance) benefits received by a parent as representative payee for her children may be included as income to her to the extent that the benefits exceed the budgeted needs of the children as determined by the State Welfare Department for the purpose of determining her eligibility for assistance under the State's AFDC (Aid to Families with Dependent Children) program. The plaintiffs assert that this regulation is in conflict with the Social Security Act and the regulations issued pursuant to it and violates their equal protection and due process rights under the Fourteenth Amendment and 42 U.S.C. § 1983 (1970). The case is before this Court now on plaintiffs' motion for summary judgment.

I.

Plaintiff Cleo Johnson is suing on behalf of herself, her minor dependent children and other members of the already certified class. By stipulation of the parties and order of this Court, that class has been defined as consisting "of minors who are beneficiary members of AFDC family units, in cases in which the OASDI benefits available to such minors of the unit are applied by the Department of Welfare as funds available to the support of a Supervising Relative who is a needy parent of the minors."

The situation of plaintiff Johnson and her children is truly typical of the class which they represent. There is no dispute as to the following facts involving her situation and the relevant state and federal laws which affect it. Mrs. Johnson is a resident of Waterbury, Connecticut and a mother of ten children who reside with her. Two of those children, Frances and Marianne, receive OASDI benefits in the amount of $103.00 per month to which they became entitled upon the death of their father in 1963.¹ Mrs. Johnson receives the payments due to these children by virtue of her appointment as representative payee under the terms of 20 C.F.R. § 404.1601 (1974).² Under 20 C.F.R. § 404.1603 (1974), Mrs. Johnson, as representative payee, is charged with the responsibility of using such payments only for the "use and benefit of such beneficiary in the manner and for the purposes determined by her to be in the beneficiary's best interest."

Mrs. Johnson and her other eight children have no source of income other than the assistance they receive from the State under the AFDC program.³ In determining the amount of welfare assistance for a family unit, the State measures the needs of the unit versus its available income. It then provides AFDC assistance in the amount of the difference between these two figures. Such a computation is required by 42 U.S.C. § 602(a)(7) (1970) which provides that in determining the eligibility or amount of aid of any family assistance unit, the State must "take into consideration any other income and resources of any child or relative claiming aid to families with dependent children . . . ." In reliance upon this provision, the State Welfare Department has adopted Regulation 335.16(VI) of the Connecticut Welfare Manual, the full text of which is set out in the margin.⁴

Essentially, this regulation covers the situation wherein a parent whose family is eligible for AFDC assistance is also the representative payee of one or more of her children who is receiving OASDI benefits. If the amount of the OASDI benefits exceeds the needs of the child beneficiary, as determined by the State Welfare Department, then the "surplus" is considered available income to the supervising relative (not, however, to any other relatives in the unit who are not in the "supervisory" position). This has the effect of either diminishing the size of any AFDC payments to which the supervising relative would be entitled if that "surplus" were not considered available income to her or rendering her entirely non-eligible. Furthermore, even if the parent were to exercise the option of removing the OASDI beneficiaries from the AFDC family assistance unit, the regulation provides that the "surplus" OASDI benefits would still be imputed to her.

In the case of Mrs. Johnson and her family, the defendant's application of the regulation has had a substantial financial impact. If the "surplus" OASDI benefits received by her on behalf of her two children were not imputed to her as available income, her family assistance unit, including her and her eight other children, would be receiving $547.36 per month. However, because of the operation of the regulation, her needs are considered to have been met by the "surplus" OASDI benefits and so the needs of her family unit are measured only by the remaining needs of her other eight children. As a result, the family's monthly benefits are only $505.23.

II.

Plaintiffs challenge this regulation on two distinct constitutional grounds. First, they argue that the regulation violates their rights to equal protection of the law because the assessment made against children who receive OASDI benefits is not made against other similarly situated children who have income from other sources. For example, they point out that all of the income of a full time student between the ages of fourteen and twenty-one is disregarded when computing the needs of the other members of his family. More significantly, state regulations provide that the first $250.00 per month of income of a legally liable relative who resides with an AFDC eligible family is exempt from consideration as income of the family. Secondly, plaintiffs argue that the regulation violates their right to due process in that it establishes an irrebuttable presumption that the "surplus" OASDI income is actually available to meet the needs of the needy, supervising relative. Cf. United States Department of Agriculture v. Murry, 413 U.S. 508, 93 S.Ct. 2832, 37 L.Ed.2d 767 (1973). Plaintiffs also challenge the regulation as being in violation of the Social Security Act and the regulations issued pursuant to it.

The plaintiffs' constitutional claims are not insubstantial. Accordingly, this Court has jurisdiction of this action under 28 U.S.C. § 1343(3) and consequently has jurisdiction to decide the plaintiffs' pendent statutory claim. Hagans v. Lavine, 415 U.S. 528, 94 S.Ct. 1372, 39 L.Ed.2d 577 (1974). Indeed, this Court is required to decide that statutory issue first in order to avoid, if possible, a constitutional adjudication. Hagans v. Lavine, supra at 549-550, 94 S.Ct. 1372. California Human Resources Department v. Java, 402 U.S. 121, 124, 91 S.Ct. 1347, 28 L.Ed.2d 666 (1971).⁵ Since there is no "genuine issue as to any material fact," Fed.R.Civ.P. 56(c), this case is ripe for disposition on plaintiffs' motion for summary judgment.

III.

It is clear that although a state need not participate in the AFDC program, it must, if it does participate, operate its program in conformity with "several requirements of the Social Security Act and with rules and regulations promulgated by HEW." King v. Smith, 392 U.S. 309, 317, 88 S.Ct. 2128, 2133, 20 L.Ed.2d 1118 (1968); Rosado v. Wyman, 397 U.S. 397, 420, 90 S.Ct. 1207, 25 L.Ed.2d 442 (1970). Plaintiffs contend that Regulation 335.16(VI) of the Connecticut Welfare Manual violates federal regulations which deal with the obligations and duties of a representative payee with regard to money received on behalf of OASDI beneficiaries. 20 C.F.R. §§ 404.1601-404.1610 (1974). Specifically, they argue that it is a violation of the letter and spirit of those regulations for the State to consider any part of the OASDI payments as available income to the representative payee. Rather, the OASDI benefits are only to be employed for the beneficiaries' "use and benefit." 20 C. F.R. § 404.1603.

The defendant, on the other hand, argues that the regulation in question does not violate the federal regulations dealing with the use of OASDI benefits. In support of its position, it points to 20 C.F.R. § 404.1607 (1974) which provides:

"If current maintenance needs of a beneficiary are being reasonably met, a relative or other person to whom payments are certified as representative payee on behalf of the beneficiary, may use part of the payments so certified for the support of the legally dependent spouse, a legally dependent child, or a legally dependent parent of the beneficiary."

From this regulation the defendant reasons that if a supervising relative, who is also a dependent parent of the beneficiary, can, in her discretion, use part of her child's OASDI benefits for her own support, then the State should be permitted to credit her with those payments when her needs under the AFDC program are being determined.⁶ This I understand to be the substance of defendant's argument.

The defendant in relying upon § 404.1607 ignores the context in which it was written. That regulation is a part of a group of regulations, 20 C.F.R. §§ 404.1601-404.1610 (1974), which carefully set out the fiduciary responsibilities of a representative payee and clearly circumscribe the available uses of the OASDI benefits. Acting as a fiduciary, the representative payee is enjoined to use such benefits "only for the use and benefit of such beneficiary in the manner and for the purposes determined by him to be in the beneficiary's best interest." 20 C.F.R. § 404.1603 (1974). (Emphasis added). Furthermore, the payee is required by the terms of 20 C. F.R. § 404.1605 (1974) to...