Rosenfeld v. Blum

• Decision Date: 24 August 1981
• Citation: 82 A.D.2d 559,442 N.Y.S.2d 89
• Parties: In the Matter of Yvonne ROSENFELD, Petitioner, v. Barbara BLUM, as Commissioner of the New York State Department of Social Services, et al., Respondents.
• Court: New York Supreme Court — Appellate Division

Page 89

442 N.Y.S.2d 89

82 A.D.2d 559

In the Matter of Yvonne ROSENFELD, Petitioner, v. Barbara BLUM, as Commissioner of the New York State

Department of Social Services, et al., Respondents.

Supreme Court, Appellate Division,

Second Department.

Aug. 24, 1981.

Leonard S. Clark, Nassau/Suffolk Law Services Committee, Inc., Hempstead (Richard Gabriele, Hempstead, of counsel), for petitioner.

Robert Abrams, Atty. Gen., New York City (Eugene E. Zegarowicz, Asst. Atty. Gen., New York City, of counsel), for respondent State Commissioner.

Before LAZER, J. P., and MANGANO, COHALAN and MARGETT, JJ.

LAZER, Justice Presiding.

This article 78 proceeding challenges the method utilized by the State Commissioner of Social Services to deduct Federal benefits from petitioner's public assistance grant of home relief. We find that the method used violates the economic assumptions implicit in the Social Services Law under which Social Services authorities are permitted to impute the receipt of additional income to public assistance recipients under certain circumstances. Specifically, we hold that the automatic deduction of certain "in-kind" income, as defined by the Social Security Administration and adopted wholesale by the State Commissioner, impermissibly attributes such income to the petitioner.

I

Petitioner, a disabled person, was the recipient of $272 a month in public assistance (Home Relief, Social Services Law, § 157 et seq.) as well as $48 a month in food stamps (U.S. Code, tit. 7, § 2011 et seq.) until March, 1979, when she was served with a series of notices from the local social services agency prompted by her qualifying for Federal Supplemental Security Income (SSI) (U.S. Code, tit. 42, § 1381 et seq.). By separate notices the agency informed petitioner of its intent to discontinue both forms of aid it had been extending. Public assistance was to be terminated because of petitioner's failure to turn over (apparently pursuant to 18 NYCRR 370.11 her first SSI benefit check so that the agency could recoup any home relief paid after that check's February, 1979 retroactive date; the food stamps were to be discontinued because petitioner's status as a public assistance recipient was being terminated.

Five weeks later the agency withdrew its notice of termination of public assistance because the SSI check had been turned over to the agency; however, the agency never withdrew its food stamp discontinuance notice. The agency also informed petitioner that her public assistance grant was being reduced to $1.75 a month based upon the following budget calculation, which took her SSI income into account ¹:

At the fair hearing requested by the petitioner, the agency representative testified that the deduction of the in-kind income figure of $83.13 did not result from any investigation by the local agency but was the consequence of information conveyed to it by the Social Security Administration. Although petitioner declared that her sole monthly income apart from her public assistance grant was SSI benefits of $187.12, she also testified that she lived in her "own" home and that her sister handled all her financial affairs. The agency representative reported that the agency's figure for her "actual" rent was $417 a month, of which $267 was paid by "relatives". No information was offered respecting petitioner's marital status, her title to or equity in or shared occupancy of the house, or expenditures and consumption patterns relating to shelter, food or utilities.

With respect to food stamps the agency representative admitted that the agency's action in terminating the benefit had not been based on the reason specified in the notice of discontinuance but, instead, was grounded (apparently) upon a change in Federal law that made financial condition rather than public assistance status the sole eligibility criterion.

Petitioner's attorney argued that the agency's deduction of $83.13 monthly as in-kind income from petitioner's public assistance grant was improper because the agency had failed to show that this sum constituted income or resources "available" to her under New York law (see Social Services Law, § 131-a, subd. 1; 18 NYCRR 352.16 352.23 He also pointed out that because petitioner remained a public assistance recipient, her food stamp entitlement could not be terminated absent agency action upon a ground specified in the advance notice required by 18 NYCRR 358.8(a). In her decision after the fair hearing, the State Commissioner rejected petitioner's challenge to the use of in-kind income and stated that the termination of food stamps was mandated by passage of the Food Stamp Act of 1977, which was being implemented by local social services districts between March 1 and June 30, 1979.

Petitioner then commenced this proceeding to annul the determination, to direct the Commissioner to disregard in-kind income absent a showing of actual availability, and to direct a retroactive grant of public assistance and food stamps.

We believe petitioner is entitled to the relief sought, except with reference to retroactive benefits; in this regard, petitioner's relief is limited to a new fair hearing upon proper notice concerning her entitlement to such benefits under the home relief and food stamps programs. The State Commissioner has already acquiesced in the relief sought with respect to food stamps. This position comports with the rule set down in Matter of Ryan v. New York State Department of Social Servs., 40 A.D.2d 867, 338 N.Y.S.2d 162, which requires annulment of a determination based upon a reason not specified in the notice to the public assistance recipient (see, also, 7 CFR 273.13 [2]).

With respect to the reduction of public assistance by an amount calculated by the Social Security Administration to be "in-kind" income, the record here is woefully short of evidence sufficient to sustain the agency's determination.

The State Commissioner argues that petitioner has not been prejudiced by the State's uncritical adoption of the Federal agency's determination, "especially since the actual 'in-kind' income is the sum of $267--the amount contributed toward petitioner's rent by her sister." This assertion, made for the first time in this court, is frivolous.

First, apart from the issue of the weight to be given to the hearsay opinion of the Social Security Administration, there is nothing in the record to indicate just how the precise figure of $83.13 was derived or how it relates to petitioner's shelter expense or to any other resource or expense in this matter.

Second, the argument ignores the fact that the record reveals only that whatever the relatives may pay for the rent alone on petitioner's behalf is in addition to the maximum shelter allowance for a one-person household paid petitioner under the Commissioner's regulations; hence it does not appear to be a resource available to meet any of petitioner's other needs. The Commissioner apparently labors under the assumption that in-kind income, determined under SSI criteria, is allocable to those needs of petitioner met by public assistance, and that home relief payments can be pruned accordingly to reflect this substitution of private for public dollars.

Although the first objection to the Commissioner's argument is sufficient of itself to mandate annulment of the determination under review, reconsideration on remittitur for the purpose of establishing the nature and amount of in-kind income necessarily will implicate the assumption that petitioner's in-kind income is allocable to whatever of her needs as are met by public assistance. Examination of this assumption is thus warranted.

II

Home relief is funded and controlled entirely by the State (see Matter of Delmar v. Blum, 53 N.Y.2d 105, 440 N.Y.S.2d 604, 423 N.E.2d 27), and under compulsion of the State and Federal Constitutions the Commissioner must use State dollars to make good any shortfall between SSI benefits and the State public assistance schedule in those instances in which the Federal benefits fail to equal or exceed the public assistance living standard (Matter of Lee v. Smith, 43 N.Y.2d 453, 402 N.Y.S.2d 351, 373 N.E.2d 243). The issue, therefore, is whether the Commissioner's deduction from home relief on account of SSI "in-kind" income underassesses the petitioner's needs as fixed under State law. To resolve the issue, it is necessary to examine the criteria used in the statutory SSI and home relief schemes for measuring petitioner's needs in light of her income and resources.

The general rule for both schemes is that an applicant's eligibility and the amount of benefits or assistance must take into account only such income and resources as are actually available to the applicant. State law imposes this limitation in express terms (see Social Services Law, § 131-a, subd. 1; 18 NYCRR 352.16 ² 18 NYCRR 352.23 ³ Matter of Dumbleton v. Reed, 40 N.Y.2d 586, 388 N.Y.S.2d 893, 357 N.E.2d 363; Matter of Reid v. Toia, 72 A.D.2d 465, 467-468, 424 N.Y.S.2d 964). Federal regulations, including those for SSI, ⁴ generally impose the actual availability requirement upon Social Security programs (20 CFR 416.1120; ⁵ 45 CFR 233.20 ⁶), forbid the use of assumptions respecting contributions from nonlegally responsible individuals in the household (45 CFR 233.20 ⁷ and prohibit inclusion of SSI beneficiaries (45 CFR 233.20 ⁸ or nonlegally responsible individuals (45 CFR 233.20 ⁹ 233.20 ¹⁰) in households receiving Aid to Families with Dependent Children (ADC) for purposes of prorating public assistance (see Green v. Barnes, 10th Cir., 485 F.2d 242; Kimmes v. Califano, 472 F.Supp. 474; Wilczynski v. Harder, 323 F.Supp. 509; but see Antonioli v. Harris, 9th Cir., 624 F.2d 78).

In the instant matter the State Commissioner accepted the Social Security Administration's determination that there was available to petitioner a sum denominated as "in-kind" income, which is treated in section 1382a (subd. par....