[Federal Register Volume 77, Number 156 (Monday, August 13, 2012)]
[Rules and Regulations]
[Pages 48045-48058]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19768]
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Rules and Regulations
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Federal Register / Vol. 77, No. 156 / Monday, August 13, 2012 / Rules
and Regulations
[[Page 48045]]
DEPARTMENT OF AGRICULTURE
Food and Nutrition Service
7 CFR Parts 272 and 273
RIN 0584-AB51
Supplemental Nutrition Assistance Program: Disqualified Recipient
Reporting and Computer Matching Requirements
AGENCY: Food and Nutrition Service, USDA.
ACTION: Final rule.
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SUMMARY: This final rule codifies the provisions of a proposed rule
published on December 8, 2006, regarding prisoner verification and
death matching procedures mandated by legislation and previously
implemented through agency directive. This rule also requires State
agencies to use electronic disqualified recipient data to screen all
program applicants prior to certification to assure they are not
currently disqualified from program participation. Finally, this final
rule implements procedures concerning State agencies', participation in
a computer matching program using a system of records required by the
Computer Matching and Privacy Protection Act of 1988, as amended.
DATES: October 12, 2012.
FOR FURTHER INFORMATION CONTACT: Jane Duffield, Chief, State
Administration Branch, Program Accountability and Administration
Division, Supplemental Nutrition Assistance Program, Room 857,
Alexandria, Virginia 22302, 703-605-4385, Jane.Duffield@fns.usda.gov.
SUPPLEMENTARY INFORMATION:
Background
On December 8, 2006, the Food and Nutrition Service (FNS) published
a proposed rule in 71 FR 71075 to revise the SNAP regulations in 7 CFR
parts 272 and 273 regarding computer matching requirements, the
prisoner verification system (PVS), the deceased person matching system
and electronic disqualified recipient system (eDRS) matching, as well
as redefining data requirements and retention, and the process for
application screening. Comments on these proposed revisions were
solicited until February 6, 2007. A total of 26 sets of comments were
received by the published deadline from 22 State SNAP agencies, 2
governmental associations, and 2 recipient interest groups. This final
rule addresses the concerns expressed in these comments. Readers are
referred to the proposed rule for a more complete description of the
rule's requirements and stipulations. The following is a discussion of
the provisions of the proposed rule, the comments received, and the
changes made in the final rule.
General Comments
Of the 26 sets of comments received, most recommended that FNS
withdraw the proposed regulation altogether. Of these, 15 comments
offered alternative suggestions for FNS to consider. FNS categorized
the comments in order to sum up their contents: Burdensome and
Ineffective (20 comments); Impact on Application Timeliness (15
comments); Impact on Simplified Reporting (12 comments); Impact on
State Computer Systems (9 comments); Inaccurate Cost-Benefit Analysis
(3 comments); and Cases Where Matches Cannot Be Verified (3 comments).
All comments are addressed under the specific regulation citation they
reference. Some comments received were general and did not pertain to
specific regulation citations. Those comments are addressed first and
are related to simplified reporting and computer systems.
Simplified reporting was authorized by the Farm Security and Rural
Investment Act of 2002 (the 2002 Farm Bill), subsequent to the
implementation of prisoner and death matching requirements. Since 2002,
51 State agencies have opted to implement simplified reporting.
Generally, under simplified reporting, households are required to
report changes in income between certification and scheduled reporting
periods only when the total countable income rises above 130 percent of
the poverty level. Prior to simplified reporting, most households were
required to report most changes within 10 days, or monthly. State
agencies implementing simplified reporting can set reporting intervals
or certification periods at 4, 5, or 6 months. Generally, for
households subject to simplified reporting, the death or imprisonment
of a household member does not have to be reported until the 6-month
report, or at the next recertification period for prisoner
verification. Those electing 12-month certification spans must require
an update of household circumstances at the 6-month interval, unless
the household is made up of elderly or disabled members.
In some circumstances, no overpayment can occur if the change was
not required to be reported. Simplified reporting has provided multiple
benefits for State administration and Program access. FNS concurs with
the comments expressing that simplified reporting has been beneficial
in making the Program more efficient and recipient-friendly and will
make specific accommodations for simplified reporting options when
warranted in the waiver process.
In regard to the need to change computer systems, nine State
agencies commented that the overall provisions in the proposed rule
will require them to make expensive changes. There were three comments
concerned with the steps States may need to take if the matches
required by these provisions cannot be verified. In this instance, no
adverse action is to be taken against the households for any matches
described in this rule that cannot be verified.
In general, the comments expressed recognition that these matches
are required by law, and suggested alternatives that would allow State
agencies the discretion to determine the frequency of the matches.
While FNS carefully considered these comments, the matches are required
by law and FNS considers the frequency of the matching requirements
described herein to be an acceptable standard.
Prisoner Verification System (PVS)
Section 1003 of the Balanced Budget Act of 1997 (Pub. L. 105-33)
amended Section 11(e) of the Food Stamp Act of
[[Page 48046]]
1977 \1\ (7 U.S.C. 2020(e)) to require States to establish systems and
take periodic action to ensure that an individual who is detained in a
Federal, State, or local penal, correctional, or other detention
facility for more than 30 days shall not be eligible to be counted as a
household member participating in SNAP. The FNS final rule will codify
this requirement and define taking periodic action as requiring States
to conduct PVS checks at application and re-certification.
---------------------------------------------------------------------------
\1\ The Food Conservation and Energy Act of 2008 (FCEA) renamed
the Food Stamp Act of 1977 to the Food and Nutrition Act of 2008.
---------------------------------------------------------------------------
FNS received several comments specifically addressing this
provision. Thirteen comments stated that PVS data received from the
Social Security Administration (SSA) is not reliable, shows only that
individuals have been incarcerated in the past, and does not provide
the admission and tentative release dates. One comment stated that
State agencies cannot require correctional facilities to provide the
necessary verification for taking action. Further, six comments
indicated that including children and one-person households in the PVS
matches provide little value.
FNS carefully considered these comments in finalizing this
provision and agrees that it is appropriate to exempt minor children,
as that status is defined by each State, and one-person households
where there is a face-to-face interview. Therefore, these exemptions
are provided for in the revised Sec. 272.13. However, with regard to
the frequency of the match, taking into account both simplified
reporting and the need to prevent those incarcerated for more than 30
days from participating, FNS determined that conducting the prisoner
match at application and recertification provides the best opportunity
for effective policy enforcement. Therefore, FNS retained in this final
rule the requirement to perform a PVS match with household members at
application and recertification. Going forward, FNS will make every
effort to work with the SSA and other relevant agencies to improve the
quality and timeliness of the data made available to State agencies for
the purpose of conducting the prisoner match. FNS is also willing to
consider any alternatives that State agencies may wish to propose for
their own unique situation through its waiver process.
Deceased Matching System
This rule also implements the deceased matching requirements
enacted by Public Law 105-379 on November 12, 1998. Public Law 105-379,
which amended Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020),
required all State agencies to enter into a cooperative arrangement
with the SSA to obtain information on individuals who are deceased, and
use the information to verify and otherwise ensure that benefits are
not issued to such individuals. The law went into effect on June 1,
2000. The mandated requirements were implemented by FNS directive to
all SNAP State agencies on February 14, 2000. State agencies are
responsible for entering into a matching agreement with SSA in order to
access information on deceased individuals. FNS proposed adding a new
Sec. 272.14 to codify this requirement in regulation and included
requirements for accessing the SSA death master file. These
requirements included independently verifying the record prior to
taking adverse action, and conducting matches for deceased individuals
at application and re-certification.
Several comments specifically addressed this provision. Eleven
comments stated that experience has shown that it is very unusual for
households to initially apply for benefits for a deceased household
member. They state that, since starting to conduct death matches in
1999, it is more common that the death of a household member during the
certification period goes unreported by the remaining household
members. With simplified periodic reporting, the change does not need
to be reported until the interim report of the next recertification.
Four comments received noted that the preamble to the proposed rule
states that the SSA death master file be matched at the time of
application and at recertification, but the actual wording in the
regulation language says ``* * *at the time of application and
periodically thereafter.'' FNS concurs that this is inconsistent and
confusing; ``periodically thereafter'' may not be the same as
recertification. FNS has, therefore, amended this provision in the
final rule as indicated below.
Two comments noted that fulfilling the volume of match requests at
the frequency required by the proposed regulation would be burdensome
for SSA. One commenter further noted that, in the past, FNS has
instructed State agencies to reduce the frequency of matches because
the previous frequency was burdensome for SSA. SSA did encounter
certain burdens during the implementation phase of the prisoner and
death matches, but has subsequently worked through those complications.
Nevertheless, FNS does want to focus on implementing requirements that
will improve Program integrity while not imposing unnecessary burdens
on State agencies.
Accordingly, after considering the comments, FNS is amending the
final rule with respect to death matches. The revised final provision
at Sec. 272.14(c)(1) provides the requirement that State agencies
conduct the match of deceased individuals against household members at
application and no less frequently than every 12 months. As a result,
FNS believes this final rule maintains the intent of the statute for
conducting this match while relieving States of requirements that do
not effectively promote Program integrity. In addition, State agencies
can design their matching systems to make them more consistent with
their simplified reporting procedures.
Disqualified Recipient Reporting
Existing regulations at Sec. 273.16(i)(4) require State agencies
to use disqualified recipient data to ascertain the correct penalty,
based on prior disqualifications, for an individual currently suspected
of an intentional Program violation (IPV), and to determine the
eligibility of Program applicants suspected of being in a disqualified
status. The proposed rule further proposed:
State agencies use disqualified recipient data to screen
all Program recipients and applicants prior to certification. State
agencies may also periodically match the entire database of
disqualified individuals against its current caseload.
State agencies not take an adverse action against a
household based on information provided by a disqualified recipient
match unless the match information has been independently verified.
The State agency initiating the disqualified recipient
search contact the State agency that originated the disqualification or
the household for verification prior to taking adverse action against
the household. The proposed rule proposed that the agency that
originated the disqualification provide documentation to the requesting
agency within 20 days of the postmarked date of request.
The disqualified individual and, if applicable, the
household, be informed of the effect of the existing disqualification
on the eligibility and, if applicable, benefits of the remaining
household members.
Changes and updates to the format, methodology and fields
State agencies use to report and access intentional
[[Page 48047]]
Program violation (IPV) disqualification information.
Several comments specific to disqualified recipient matching were
received. Regarding implementation, 13 comments noted that the
provisions of the rule would be very difficult to implement because the
nationwide eDRS database provided by FNS to perform this function is
problematic. The comments further state that very few of the
disqualifications in eDRS are relevant to the day-to-day operation of
the Program because eDRS maintains disqualifications indefinitely,
including those for individuals who are deceased or incarcerated for
long periods of time. As the records age, the disqualifications become
less and less useful because they have no impact on current
eligibility. One comment noted that a very small percentage of SNAP
households had the potential to be affected by an actively disqualified
household member. Also, twelve comments noted that in order to meet the
requirements of the rule, all eligibility workers would need access to
eDRS via the eAuthentication process required by the Department of
Agriculture, expressing concern that putting all eligibility workers
through this process would be cumbersome and impractical.
Regarding the need for the eDRS system, while one State agency
commented that it queries eDRS for those who newly arrive to the State,
five other State agencies noted that disqualified recipients who newly
arrive in the State are already known to the incoming State agency.
State and local eligibility workers regularly contact other State
agencies when applicants newly arrive from other States to obtain
information about the applicant's participation, disqualification and
able-bodied adults without dependents (ABAWD) status. These State
agencies asserted that there is no need to check current or former
household members (when they apply) from within the State as those
participants and their disqualification status are already known.
Further, they believed there was no reason to re-screen applicants at
recertification since the current State would have originated any
disqualification action and would have already known about it.
Regarding secondary verification, 11 comments noted that the
timeframe of 20 days, specified under the computer matching
requirements, for another State agency to respond for a request for
information, does not leave enough time to gather all of the
information and process the application in a timely manner. The
comments indicated that if the person should not have been certified,
it will be discovered when the State processes a periodic match and an
overpayment can be completed at that time. They also indicated that it
is unclear what a requesting State should do in instances of expedited
service cases or if the other State agency does not respond within 20
days. Finally, one comment supported the proposed rule's clarification
that no adverse action be taken against a recipient or applicant based
on a match unless the match information is independently verified.
Regarding the eAuthentication process, FNS recognizes that this
process may be difficult for some States to obtain the proper
eAuthentication levels for their eligibility workers. The
eAuthentication process is vital to protecting personally identifiable
information of SNAP recipients, confidentiality and the integrity of
the Program. This process, while difficult, is necessary to maintain
the security standards set forth to protect client information. FNS
will continue to explore possible ways to make the eAuthentication
process less burdensome for States in the future.
In addressing these comments, it is important to note that, as a
Program with national eligibility standards, an individual disqualified
in one State because of an IPV determination is also disqualified in
every State. However, the Program is administered by State agencies
that use and maintain their own systems and databases to perform the
functions associated with certifying and supplying benefits to
households. As such, there must be some mechanism in place so that a
State agency can determine that an applicant has been disqualified by
another State when they apply for SNAP benefits. Also, since the
disqualification penalties are cumulative, the State agency must be
aware of whether an individual has had any prior disqualifications by
any other State in order to assign the appropriate disqualification
penalty.
The issue of how States become aware of an existing or previous
disqualification to ensure that ineligible individuals are not
participating or the proper disqualification is assigned is the crux of
this portion of this rule. In the performance of this function, an
individual's rights must be protected to ensure that only those
individuals that should be ineligible to receive benefits due to an
existing or previous disqualification are indeed determined ineligible.
Further, States are expected to provide this information in a timely
manner to the requesting State so that they can determine the
eligibility of the applicant. States that fail to provide the requested
information within the time frame set forth under the computer matching
requirements are considered to be out of compliance with these
regulations. Those States will be subject to corrective action upon
review. In any case where the requesting State has not received the
information timely, the State should certify the household for benefits
in accordance with our regulations until it receives the requested
documentation. If the State subsequently receives verification that the
client or household is ineligible, they should disqualify them and
establish a claim to collect any benefits that were issued in error.
While FNS carefully considered all comments in determining the final
provisions in this rule, the Agency wanted to ensure that individuals'
rights are protected and that proper disqualifications are assigned.
FNS believes this final rule meets these goals while adequately
addressing the concerns of the comments.
Many of the comments received regarding this provision focus on the
operation and integrity of the data contained in eDRS. There were
concerns that the data may be outdated, inaccurate or incomplete. While
FNS is continuously trying to add appropriate edits and perform data
integrity checks where possible, it is ultimately the responsibility of
each State to enter timely, accurate and verifiable disqualification
data into eDRS for use by other States. This is a nationwide
partnership in which FNS and State agencies need to work together to
ensure that ineligible individuals are not participating and that
disqualified individuals receive the appropriate disqualification
period. FNS is committed to continuing efforts to improve the system
and the integrity of data to ensure accurate and timely
disqualifications are imposed.
FNS does not agree with the comment that very few of the
disqualifications in eDRS are relevant to the day-to-day operation of
the Program. Records with disqualification periods that have expired
are necessary for making penalty determinations and those that remain
active are useful for determining eligibility. Further, in addition to
the complete database file containing all the records in the system,
FNS has for some time made available a file containing only active
records, specifically designed for the purpose of conducting
eligibility matches. FNS has also modified its online database access
system to search only active records when the user selects
``Eligibility'' as the purpose for the inquiry.
[[Page 48048]]
Nevertheless, FNS agrees with the comment that a very small
percentage of SNAP households would be affected by a disqualified
member. Data reported by States indicated that, in fiscal year 2010,
36,859 individuals were disqualified out of a total of 40.3 million
participants. In addition to these 37,000 disqualifications, there are
also those still serving 2-year, 10-year or permanent disqualifications
whose records remain active. While this number remains relatively low
compared to the number of participants, it still represents a potential
issuance risk in excess of nearly $2.0 million per month should these
individuals not be prevented from participating, based on estimates for
2013. The potential also exists for any of these individuals to cross
into another jurisdiction to avoid serving their penalty. FNS believes
that some form of applicant screening is therefore necessary to prevent
those inclined to try to participate during a period of
disqualification and to deter those that might otherwise make the
attempt.
In response to those comments suggesting that there was no need to
check current or former recipients (when they apply) from within the
State, or to re-screen applicants at recertification since the State
would have originated the action and would have already known about it,
FNS would point out that since applicant matching was not previously
mandated one cannot be certain there are no disqualifications in an
individual's past. For example, applicants that may have been in a
disqualified status in one State may have moved to, and been determined
eligible by, another State that did not conduct the match at the time
of application. Therefore, it is possible that disqualified individuals
are currently participating in a number of States. However, FNS does
agree that there is probably no need to conduct matches at
recertification once FNS is reasonably certain that currently
disqualified individuals that may be receiving benefits are removed
from the active rolls. Consequently, FNS will retain the requirement to
match all applicants prior to initial certification but require matches
at recertification only for the first year subsequent to implementation
of this final rule. Within the first year of the implementation date of
this rule, but no later than 180 days from publication, States will be
required to match all applicants prior to initial certification, all
newly added household members at the time they are added, and all
participants in the household at recertification. In the second year,
the requirement to match participants at recertification will be
discontinued, and States will only be required to match applicants
prior to initial certification and newly added household members as
they are added. Further, since the purpose of a 1-year match at
recertification is to remove currently participating disqualified
individuals, States having the ability to conduct a one-time match of
their entire active caseload against active cases from the disqualified
recipient database may do so and be exempted from the requirement to
conduct matches at recertification. The periodic match that would have
been required by the proposed rule will not be required in this final
rule, but may be conducted at the option of the State. Finally, States
may exempt from the matching requirements those individuals that have
not reached the age of majority as defined by State statute.
Computer Match Benefit Adjustments
FNS proposed to add language to the existing regulations for when
mass changes are made in Federal benefits that affect SNAP allotments.
Specifically, in cases when the change in allotment was the result of a
computer match, FNS proposed that the information would need to be
independently verified, and the SNAP household would need to be
provided notice and an opportunity to contest any adverse action, if
the adjustment would change the level of benefits or eligibility status
of the household.
FNS received several comments specific to this provision. One
comment stated that this alternative is not attractive as it
constitutes much more effort than applying the existing procedure. In
addition, two commenters were concerned about the additional burden
placed upon State agencies if this information is not considered
verified upon receipt.
FNS carefully considered the comments in this area. A computer
match, covered by the Computer Matching Act [5 U.S.C. 552a(o)], uses
information provided by a Federal source and compares it to a State
record, using a computer to perform the comparison; this match affects
eligibility or the amount of benefits for a Federal benefit program. As
such, FNS has no discretion in this area and the information must be
independently verified. Moreover, the SNAP household must be provided
notice and given an opportunity to contest the adverse action if the
adjustment would change the level of benefits or eligibility status of
the household. However, State agencies should be aware that the
independent verification/notice of adverse action provisions apply only
if there is an adverse effect on benefits (i.e., a denial, termination
or reduction in benefits). The vast majority of mass changes in
benefits are increases due to cost-of-living adjustments. As such, FNS
expects this new requirement to have a minimal impact on State agency
workload. In addition, State agencies can use the option found at Sec.
273.12(e)(3)(A) to implement mass changes using percentages. Therefore,
this provision remains unchanged in the final rule (see Sec.
273.12(e)(3)(B)).
Implementation
State agencies have been instructed through FNS directive to
implement the provisions of the prisoner verification matches (Pub. L.
105-33) and death file matches (Pub. L. 105-379) as required by law in
the applicable legislation, and these matches should already be in
place without waiting for formal regulations. Unless specified below,
the remaining provisions of this rule are effective and must be
implemented the first day of the month following 60 days from date of
publication of this final rule.
Since the inception of the disqualified recipient database in 1992,
FNS has required that States query the database for the purpose of
assigning the correct penalty to those being disqualified and whenever
they believe an applicant may be in a disqualified status. To comply
with these requirements, States should already have in place some
capability for conducting matches against the disqualified recipient
database. In recognition of this, the provisions of this rule dealing
with the systematic matching of disqualification data in Sec.
273.16(i) are effective and must be implemented no later than 180 days
after the effective date of this final rule.
Procedural Matters
Executive Order 12866 and Executive Order 13563
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility.
[[Page 48049]]
This final rule has been designated a ``significant regulatory
action,'' although not economically significant, under section 3(f) of
Executive Order 12866. Accordingly, the rule has been reviewed by the
Office of Management and Budget.
Regulatory Impact Analysis
As required for all rules that have been designated as significant
by the Office of Management and Budget, the following Regulatory Impact
Analysis (RIA) was developed for this final rule.
Regulatory Impact Analysis
1. Title: Supplemental Nutrition Assistance Program: Electronic
Disqualified Recipient System Reporting and Computer Matching
Requirements that Affect the Supplemental Nutrition Assistance Program
2. Action:
a. Nature: Final Rule
b. Need for the Rule: This final rule codifies prisoner
verification and death master file matching procedures mandated by
legislation and previously implemented through agency directive. This
rule also revises SNAP regulations affecting the way State agencies
access and use client disqualification information to enforce penalties
for Intentional Program Violations (IPV).
c. Background: The Balanced Budget Act of 1997 (Pub. L. 105-33),
enacted on August 5, 1997, requires States to establish systems and
take periodic action to ensure that an individual who is detained in a
Federal, State, or local penal, correctional, or other detention
facility for more than 30 days shall not be eligible to participate in
the Supplemental Nutrition Assistance Program. The law was effective
August 5, 1998. This regulation will amend current rules to require
States to conduct Prisoner Verification System (PVS) checks at
application and re-certification. Public Law 105-379, enacted on
November 12, 1998, requires all State agencies to enter into a
cooperative arrangement with the Social Security Administration (SSA)
to obtain information on deceased individuals and to use the
information to verify and otherwise ensure that benefits are not issued
to such individuals. The law was effective June 1, 2000. FNS is also
requiring States to use the Electronic Disqualified Recipient System
(eDRS) to screen all new applicants. States report all disqualified
recipients to the eDRS database in order to prevent those individuals
from participating in other States and to ensure that the proper
penalties are assigned for intentional Program violations.
3. Justification of Alternatives. The Department has no discretion
regarding the portions of the regulation that are based on legislative
mandate to implement prisoner verification and deceased persons' data
match programs. The Department does have discretion on the portion of
the regulation affecting matches to identify disqualified recipients.
The law requires that matches be performed, but is silent on when in
the certification process the match must occur. The regulation mandates
that these matches be performed up front, prior to certification. This
alternative was chosen over requiring matches at a later point in the
certification process because of the expected result that earlier
mandatory verification will save the most taxpayer dollars.
4. Effects:
Effects on Low-Income Families. This action would identify deceased
individuals, prisoners, and other ineligibles to ensure that they are
not included as members of SNAP households. These matches will assist
State agencies in identifying who, due to extended certification
periods or failure to notify a change of household status, should no
longer receive SNAP benefits. The number of people we estimate being
removed from the SNAP caseloads as a result of the matches is described
in detail below.
PVS Matches: FNS estimates that mandatory computer matches using
the PVS will identify approximately 64,000 ineligible prisoners from
the SNAP case rolls in 2013. Because this regulation is codifying
legislation enacted some years ago, all States are currently performing
data matches using the PVS for initial certifications and
recertification, so the impacts on participation and costs for initial
certifications are incorporated in current baseline budget estimates.
There are no new savings.
The estimate on the impact of the computer match using the PVS is
based on a General Accounting Office \2\ (GAO) Study, Substantial
Overpayments Result from Prisoners Being Counted as Household Members,
issued in March 1997. GAO examined data from four States: California,
Florida, New York, and Texas. GAO estimated that in 1995, $2.6 million
in benefits were paid to 9,440 State prisoners, and $925,000 in
benefits was paid to 2,698 county prisoners, with a total of 12,138
prisoners receiving $3.5 million for an average of 3.85 months. If we
assume that prisoners would have continued to receive benefits for one
month before the data match identified them and they were removed from
the caseload rolls, we estimate that a mandatory computer match with
State and County prisoner databases at the time of certification could
have saved $2.6 million in overpayments in those four States. The one
month that the prisoners would continue to receive benefits reduces the
savings from the match from $3.5 million to $2.6 million. The 12,138
prisoners accounted for 0.13 percent of the 1995 SNAP caseload among
those four States.
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\2\ The General Accounting Office is now known as the Government
Accountability Office.
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Between 1989 and 2009, the average number of initial certifications
was nearly identical to the number of households participating in an
average month, and the average number of recertifications was close. In
any given year, the two numbers tracked closely together--when
caseloads rose, so did the number of initial certifications and
recertifications. Since we project caseloads and not initial
certifications and recertifications, we use projected participation
estimates as a proxy for the number of certifications and
recertifications.
The effect on participation resulting from a mandatory computer
match is taken by applying the 0.13 percent impact to the total
projected FY 2013 caseload of 46.9 million. This yields an estimate of
61,000 ineligible prisoners who would be taken off the SNAP rolls at
initial certification. However, prior to the enactment of the
legislation mandating matches, a number of States were already
performing these matches--Connecticut, Massachusetts, New York,
Maryland, Pennsylvania, Florida, Mississippi, North Carolina,
Tennessee, Illinois, Texas, Kansas, and Missouri--accounting for 45
percent of the FY 2011 caseload. We also adjusted to account for an
increase in the number of prisons between 1995 and 2017 (actual numbers
through 2010 and projected for 2017) and an expected false positive
match rate of 10 percent. Making the match mandatory for the States who
did not perform the match prior to the legislation will remove 44,000
prisoners in 2013.
Requiring biennial matches at the time of recertification would
yield yet more ineligible prisoners. No States were performing matches
at recertification when the law was enacted, but now all States are, so
all of the savings are incorporated in the budget baseline and none are
``new.'' There would be no savings from those prisoners who were
identified in previous matches. According to the most recent SNAP
characteristics report, the average certification period for SNAP
households is 12 months.
[[Page 48050]]
However, the number of new prisoners who entered the system in 2010 is
about half the total prison population as of June 30, 2011. Therefore,
matches at recertification would yield only half as many hits as
matches performed at initial certification. Therefore, we halved the
original impact of 61,000. We also adjusted for an increase in the
number of prisoners from 1995 to 2013 and assumed a 10 percent false
positive match rate. Finally, we halved the impact yet again to adjust
for biennial matches. The estimate of prisoners identified at
recertification matches in 2013 is 20,000.
To obtain the impact of performing the matches at initial
certification and at recertification, we added the two totals together,
getting 64,000 prisoners for 2013. The estimate assumes that these
prisoners identified by the matches would then be removed from the SNAP
caseloads.
To obtain the impact of performing the matches at initial
certification and at recertification, we added the two totals together,
getting 60,000 prisoners for 2012. The estimate assumes that these
prisoners identified by the matches would then be removed from the SNAP
caseloads.
Matches with Social Security Deceased Lists. Mandatory computer
matches using Social Security Administration (SSA) lists of deceased
individuals could identify an estimated 100,000 deceased individuals on
SNAP case rolls in 2013 Because this regulation is codifying
legislation enacted some years ago, all States are currently performing
data matches using the SSA lists at initial certification and at
recertification, so the impacts of matches at initial certification on
participation and costs are incorporated in current baseline budget
estimates. There are no new savings that are not incorporated in the
current budget baseline estimates.
In 2013, we estimate that 39,000 deceased individuals will be
identified from matches performed at initial certification, and 61,000
individuals will be identified through matches performed at
recertification.
The estimate on the impact of the computer match using SSA lists of
deceased individuals is based on a GAO Study, Thousands of Deceased
Individuals Are Being Counted as Household Members, issued in February
1998. GAO examined data from four States: California, Florida, New
York, and Texas, and estimated that in 1995 and 1996, $8.4 million in
benefits were paid on behalf of 25,881 deceased individuals, with these
individuals ``receiving'' benefits for an average of 4.17 months. If we
assume that some deceased individuals would have continued to be issued
benefits for one month before the data match identified them and they
were removed from the caseload rolls, we estimate that a mandatory
computer match with SSA databases could have saved $3.2 million per
year in overpayments. This figure is derived from taking the $8.4
million they received in benefits over two years, assuming that they
would still receive benefits for 1 month rather than an average of 4.17
months, and halving the figure to get an annual total. The 12,941
deceased individuals (half of the 25,881 individuals identified over a
two-year period) accounted for 0.14 percent of the 1996 SNAP caseload
in those four states.
Between 1989 and 2010, the average number of initial certifications
was nearly identical to the number of households participating in an
average month, and the average number of recertifications was close. In
any given year, the two numbers tracked closely together--when
caseloads rose, so did the number of initial certifications and
recertifications. Since we project caseloads and not initial
certifications and recertifications, we use projected participation
estimates as a proxy for the number of certifications and
recertifications.
The effect on participation resulting from a mandatory computer
match on deceased individuals at the time of initial certification is
taken by applying the 0.144 percent impact to the total projected FY
2013 caseload of 46.9 million. This yields an estimate of nearly 68,000
deceased individuals who would be taken off the SNAP rolls. Several
adjustments were made after this point. First, prior to the enactment
of the legislation mandating matches, a number of States were already
performing these matches--California, New York, Florida, Illinois, and
Ohio--accounting for 35 percent of the FY 2011 caseload. We assume that
10 percent of the matches are false positives. We estimate that
mandatory matches at certification will identify an estimated 39,000
deceased individuals being removed from the rolls in 2013.
Requiring the matches at the time of recertification would identify
more deceased persons. Since no States were performing matches at
recertification at the time that the law was enacted, all States would
be included. We also assume that 10 percent of the matches are false
positives. Thus, we estimate that performing the match at
recertification would identify 61,000 deceased individuals in 2013 for
removal from SNAP caseloads.
To obtain the impact of performing the matches at initial
certification and at recertification, we added the two totals together,
for a total of 100,000 deceased persons identified through matches in
2013.
Matches Using the eDRS. Optional matches at initial certification
using the eDRS as currently being performed will remove more than 6,000
ineligible persons from caseloads at initial certification in 2013.
Making matches mandatory at initial certification and conducting a one-
time match at recertification for current participants will remove an
additional 9,000 ineligible persons from the caseloads in 2013; nearly
3,000 identified at initial certification and more than 6,000
identified at recertification.
The estimate on the impact of the computer match using the eDRS is
based on a GAO Study, Households Collect Benefits for Persons
Disqualified for Intentional Program Violations, issued in July 1999.
GAO examined data from four States: California, Illinois, Louisiana,
and Texas, and estimated that in 1997, $528,000 in benefits were paid
to households on behalf of 3,166 disqualified individuals, with these
individuals receiving benefits for an average of 2.33 months. If we
assume that some disqualified individuals will continue to be issued
benefits for one month, we estimate that a mandatory computer match at
initial certification with the eDRS could have saved $301,000 in
overpayments.
The four States accounted for 28 percent of the caseload in 1997
and 29 percent of benefits issued. Thus, taking the demonstration
figures and applying them nationally, we estimate that over 11,000
individuals would have been disqualified.
We know from the eDRS that as of December 2010, 49,500 individuals
were currently disqualified from SNAP. We do not have figures for past
years, so we have no definitive data for whether the number of
individuals disqualified at any one time has risen or fallen over the
past decade. However, in the FNS National Data Bank, we have the number
of disqualifications by year and by length of disqualification. Using
this data to estimate the number of individuals becoming disqualified
and the number of individuals whose disqualification expires, we
estimate that over the past decade, the number of disqualified
individuals has fluctuated between 50,000 and 70,000, and are not
correlated with SNAP participation levels. So we did not make any
adjustments to account for changes in overall participation levels.
[[Page 48051]]
Under current regulations, States are not required to perform the
eDRS matches routinely; they are required only to do periodic matches
on an ad hoc basis. FNS staff members estimate that 27 States, with 64
percent of the SNAP caseload, are currently doing routine matches at
initial certification. No States are doing matches at recertification.
Assuming that the regulations are published by September 2012, and
adjusting for a 10 percent false positive rate for matches, we assume
that in 2013, 9,000 ineligible persons will be identified by matches
performed at initial certification. Of these, we estimate that 6,400
are currently identified and after publication of this regulation, an
additional 2,800 will be identified. We are assuming that half the
States not doing the match will have implemented the match by January
1, 2013, and the remaining States will have implemented the matches by
July 1, 2013, for an overall phase-in rate of 75 percent for 2013 and
100 percent in later years.
The number of ineligible persons identified at recertification is
adjusted downwards to account for the fact only new disqualifications
would be identified. Also, we are assuming that we are only performing
the recertification matches once, rather than annually or biannually.
To estimate the impact of running one-time matches at certification, we
computed the percentage of disqualifications which are for under a year
(91 percent), and adjusted the estimate by that factor. We estimate
that over 9,000 ineligible individuals will be identified through
matches performed at recertification. We are assuming that in 2013,
half the remaining States will have implemented the one-time matches at
recertification by January 1, 2013, and the remaining half by July 1,
2013; so we are assuming a 75 percent impact for 2013 and a 25 percent
impact for 2014. Thus, we are assuming the newly-matching States will
identify nearly 7,000 ineligible individuals in 2013, and the remaining
2,000 individuals identified in FY 2014.
To obtain the impact of performing the matches at initial
certification and at recertification, we added the totals for initial
certification and recertification together for a total of 6,000
disqualified individuals identified by States currently performing
matches and 10,000 disqualified individuals identified by States newly
implementing matches in 2013.
Effects on Administering State Agencies: This rule affects State
agencies by codifying computer matches mandated by legislation and
requiring a previously optional computer match.
Effect on Retailers. This action is not anticipated to have any
measurable impact on SNAP retailers.
Cost Impact. This action reduces benefit costs by identifying and
removing ineligible and deceased individuals from the SNAP. It does not
affect benefit levels for households without individuals identified in
the computer matches.
PVS Matches: FNS estimates that mandatory computer matches using
the PVS will save approximately $26 million in benefits that would have
been paid to households on behalf of ineligible prisoners in Fiscal
Year 2013. Of that, nearly $18 million will be saved through matches
performed at initial certification, which were made mandatory by
legislation and are incorporated in current budgetary baselines. Nearly
$8 million will be saved through matches performed at recertification,
which will be required under discretionary provisions of this
regulation. The savings is estimated at $115 million for the five-year
period 2013-2017.
The cost estimate was derived using the same methodology as that
used for the participation impact estimate. Using data from the GAO
report, we estimate that about $2,618,847 in overpayments could have
been avoided using the computer match at initial certification. This
accounted for 0.03 percent of benefits issued in Fiscal Year 1995.
Applying this to the Fiscal Year 2013 estimated benefits of $75.2
billion yields an unadjusted savings of $24 million in reduced
overpayments to prisoners at initial certification. After taking out
those States who used the PVS prior to the legislation making such
matches mandatory, adjusting for increases in the number of prisoners
since 1995, and assuming a 10 percent false positive rate for matches,
we estimate that the savings will be $18 million.
Requiring the matches at the time of recertification would yield
additional savings. Since all States are performing matches at
recertification, any cost savings are included in the current budget
baseline. There would be no savings from those prisoners who were
identified in previous matches. According to the most recent SNAP
characteristics report, the average certification period for SNAP
households is 12 months. However, the number of new prisoners who
entered the system in 2010 is about half the total prison population as
of June 30, 2011. Therefore, matches at recertification would yield
only half as many hits as matches performed at initial certification.
Therefore, we halved the original savings of $24 million. We also
adjusted for increases in the number of prisoners and assume a 10
percent false positive rate for matches. Finally, we halved the
estimate because the recertification matches will be performed
biennially, rather than annually. The savings from performing matches
at recertification is an estimated $8 million in Fiscal Year 2013.
To obtain the impact of performing the matches at initial
certification and at recertification, we added the two totals together,
for savings of $26 million. The five-year savings are an estimated $115
million.
Matches Using Social Security Deceased Lists. The mandatory
computer matches using SSA lists of deceased individuals may save over
$45 million in benefits that would have been issued to households on
behalf of deceased individuals in FY 2013. Of that, $18 million will be
saved through matches performed at initial certification, which were
made mandatory by legislation and are incorporated in current budgetary
baselines. Nearly $27 million will be saved through matches performed
at recertification, which will be required under discretionary
provisions of this regulation. The total savings over the five-year
period is estimated to be $203 million.
The cost estimate was derived using the same methodology as that
used for the participation impact estimate. Using data from the GAO
report, we estimate that about $3,185,000 in overpayments could have
been avoided using the computer match. This accounted for 0.04 percent
of benefits issued in Fiscal Year 1996.
Applying this to Fiscal Year 2013 estimated benefits of $75.2
billion yields an unadjusted savings of $30 million in reduced
overpayments to deceased individuals. After taking out those States who
ran computer matches with SSA death lists prior to the legislation
making such matches mandatory, and assuming a 10 percent false positive
rate for matches, the cost savings for performing matches at initial
certification is $18 million.
Since all States currently perform matches with SSA death lists at
recertification, these costs are all incorporated in the current budget
baselines. The average certification period is 12 months; we take an
annual estimate as for initial certification. The cost savings for
performing matches at recertification is estimated at nearly $27
million in 2013 and $121 million for 2013-2017.
We then combined the savings for matches at initial certification
and at
[[Page 48052]]
recertification for a total of $45 million. The five-year savings are
an estimated $203 million.
Matches Using the eDRS. Matches at initial certification and
recertification using the eDRS may save nearly $3 million in benefits
that would have been paid out to individuals disqualified from
participating in SNAP in Fiscal Year 2013 and $8 million for 2013-2017.
Of that, more than $1 million of these savings is incorporated in the
budgetary baseline for FY 2013; the five-year estimate is nearly $6
million. Under current law, States are only required to do periodic
matches; however, 27 States currently perform matches at initial
certification. No States perform matches at recertification. New
savings are estimated to be nearly $2 million for Fiscal Year 2013. The
five-year savings for 2013-2017 is estimated at $2.2 million.
The cost estimate was derived using the same methodology used for
the participation impact estimate. Using data from the GAO report, we
estimate that about $301,000 in overpayments could have been avoided
using the computer match. Since the states featured in the GAO study
accounted for 29 percent of all benefits, applying the study estimates
nationally would have saved nearly $1.1 million in FY 1997.
No adjustments were made to account for caseload changes, since
recent data, as discussed earlier, does not show a correlation between
the number of disqualified individuals and SNAP participation levels.
Since 1997, the average monthly benefit has risen; we anticipate that
the average monthly benefit will be about 85 percent higher in 2013-
2017. (The American Recovery and Reinvestment Act of 2009 increased the
maximum allotment by 13.6 in April 2009 and froze it until FY 2014.)
Inflating the 1997 cost to capture 2013 benefit costs yields nearly $2
million in savings.
We estimate that today, 64 percent of benefits were issued to
States currently performing routine matches at initial certification.
We then adjust for past and expected increases in the average monthly
benefit, and assume a 10 percent false positive match rate. We estimate
that the 2013 cost savings estimate will be $1.1 million for States
currently performing the match, with a five year savings of nearly $6
million. We assume that the final regulation is published by October 1,
2012. We assume that 50 percent of the States currently not performing
matches at recertification will start by January 1, 2013, and the
remaining States will start by July 1, 2013, so the overall phase-in
rate for 2013 is 75 percent. The 2013 cost savings by States newly
performing the match will be nearly $500,000, and the five year savings
will be $3 million.
Today, no States are performing matches at recertification, so all
savings are ``new'' and not incorporated in the budget baseline. This
proposal would require all States to perform a one-time match at
recertification to capture cases not recently certified. The cost
savings from disqualifying ineligible persons identified at
recertification is adjusted downwards to account for the fact only new
disqualifications would be identified. To estimate that, we computed
the percentage of disqualifications that is for under a year (90
percent) and adjusted the estimate by that percentage. We also assumed
that 10 percent of matches will be false positives. We estimate that
the 2013 cost savings will be $1.1 million, with 75 percent of the
matches run the first year; and the remainder matches run the second
year. The five-year savings will be $1.6 million.
The combined savings for matches against the eDRS performed at
initial certification and recertification is nearly $3 million in 2013
and $8 million over the 2013-2017 five-year time period. Of that, $1
million in 2013 savings comes from States currently performing the
match and $1.7 million comes from new States. For the five-year period,
nearly $6 million in savings comes from States currently performing the
match and $2.2 million comes from new States.
The total savings from the computer matches is estimated at $73
million in 2013 and $326 million for the five-year period of 2013-2017.
Of this, an estimated $324 million is incorporated in the current
budget and $2 million represents new savings.
Table 1--Cost Impact of Computer Match Requirements (Federal Outlays)
[In millions of dollars]
----------------------------------------------------------------------------------------------------------------
2013
Participant
2013 2014 2015 2016 2017 5-Year Impact (in
thousands)
----------------------------------------------------------------------------------------------------------------
Mandatory prisoner
verification match:
Baseline Savings......... -25 -23 -23 -22 -22 -115 -64
New Savings.............. -0 -0 -0 -0 -0 -0 -0
----------------------------------------------------------------------------------
Total Savings............ -25 -23 -23 -22 -21 -115 -64
Mandatory death master file
match:
Baseline Savings......... -45 -41 -40 -39 -38 -203 -100
New Savings.............. -0 -0 -0 -0 -0 -0 -0
----------------------------------------------------------------------------------
Total Savings............ -45 -41 -40 -39 -38 -203 -100
Mandatory disqualified
recipient subsystem match:
Baseline Savings......... -1 -1 -1 -1 -1 -6 -6
New Savings.............. -2 -1 -0 -0 -0 -2 -10
Total Savings............ -3 -2 -1 -1 -1 -8 -16
----------------------------------------------------------------------------------
Total:
Baseline Savings......... -71 -65 -64 -63 -61 -324 -170
New Savings.............. -2 -1 -0 -0 -0 -2 -10
Total Savings............ -73 -65 -64 -63 -61 -326 -180
----------------------------------------------------------------------------------------------------------------
Note: Totals may not add up to the sum because of rounding.
[[Page 48053]]
Uncertainty: Because FNS lacks administrative or survey data that
provides information about deceased persons, prisoners, and
disqualified persons that are reported as part of households receiving
SNAP, this estimate relied on small GAO studies run on a handful of
States in the mid 1990s, and applying the impacts to the National
Program, as operating today. To the extent that these small GAO studies
are not nationally representative, the estimate will be skewed. FNS has
no way to determine the size or direction of any bias based on the
reliance of the GAO studies.
Our estimates also assume that the number of deceased persons
identified by the match on SSA records is directly proportional to past
and projected changes in SNAP caseloads. If the number of deceased
persons identified by the match grows more quickly or slowly than the
number of SNAP participants, the estimates will be biased.
Likewise, we assume that the number of households claiming prisoner
members and thus losing benefits as a result of the match is directly
proportional to past and projected changes in SNAP caseloads and the
number of individuals incarcerated. If the number of prisoners
identified by the match grows more quickly or more slowly than the
number of SNAP participants or than the number of prisoners, the
estimates will be biased.
Finally, we assume that the number of disqualified individuals has
remained fairly constant over the past decade.
In all three cases, FNS has no way to determine the size or
direction of the bias.
Because of these issues, there is a moderate degree of uncertainty
with these estimates.
Societal Costs. While this regulatory impact analysis details the
expected impacts on SNAP costs affected by the provisions described
above, it does not provide an estimate of the overall social costs of
the provisions, nor does it include a monetized estimate of the
benefits they bring to society. FNS anticipates that the provisions
will improve Program operations and strengthen Program integrity.
Rule Title--Supplemental Nutrition Assistance Program: Electronic Disqualified Recipient System Reporting and
Computer Matching Requirements that Affect the Supplemental Nutrition Assistance Program RIN 0584-AB51.
----------------------------------------------------------------------------------------------------------------
Category Primary estimate Minimum estimate Maximum estimate
----------------------------------------------------------------------------------------------------------------
BENEFITS
----------------------------------------------------------------------------------------------------------------
Annualized, monetized Benefits. Not applicable.
Annualized, quantified but Not applicable.
unmonetized, benefits.
Qualitative (unquantified) Not applicable.
benefits.
----------------------------------------------------------------------------------------------------------------
COSTS
----------------------------------------------------------------------------------------------------------------
Annualized monetized costs..... Not applicable.
Qualitative (unquantified) Not applicable.
costs.
----------------------------------------------------------------------------------------------------------------
TRANSFERS
----------------------------------------------------------------------------------------------------------------
Annualized monetary transfers: $180 million....... $180 million...... $180 million...... Regulatory Impact
``on budget''. Analysis
----------------------------------------------------------------------------------------------------------------
From whom to whom.............. Funds that would have been received by ineligible participants are not issued,
representing savings to the taxpayer.
Annualized monetized transfers: Not applicable.
``off-budget''.
From whom to whom?............. Not applicable.
----------------------------------------------------------------------------------------------------------------
Regulatory Flexibility Act
This rule has been reviewed with regard to the requirements of the
Regulatory Flexibility Act (5 U.S.C. 601-612). The Administrator of the
Food and Nutrition Service has certified that this rule will not have a
significant economic impact on a substantial number of small entities.
State and local welfare agencies will be the most affected to the
extent that they administer the Program. Applicants may be affected to
the extent that matching client information with records in eDRS, PVS
and Death Master Files may identify a client as disqualified,
preventing them from Program participation.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandate Reform Act of 1995 (UMRA)
established requirements for Federal agencies to assess the effects of
their regulatory actions on State, local and tribal governments, and
the private sector. Under Section 202 of UMRA, FNS generally must
prepare a written statement, including a cost-benefit analysis, for
proposed and final rules with ``Federal mandates'' that may result in
expenditures to State, local, or tribal governments in the aggregate,
or to the private sector, of $100 million or more in any one year. When
such a statement is needed for a rule, section 205 of UMRA generally
requires FNS to identify and consider a reasonable number of regulatory
alternatives and adopt the least costly, more cost-effective or least
burdensome alternative that achieves the objectives of the rule. This
rule contains no Federal mandates (under the regulatory provisions of
Title II of UMRA) for State, local and tribal governments, or the
private sector, of $100 million or more in any one year. Therefore,
this rule is not subject to the requirements of sections 202 and 205 of
UMRA.
Executive Order 12372
The Supplemental Nutrition Assistance Program is listed in the
Catalog of Federal Domestic Assistance under No. 10.551. For the
reasons set forth in the Final Rule codified in 7 CFR part 3015,
Subpart V and related Notice
[[Page 48054]]
(48 FR 29115), this Program is excluded from the scope of Executive
Order 12372, which requires intergovernmental consultation with State
and local officials.
Federalism Summary Impact Statement
Executive Order 13132 requires Federal agencies to consider the
impact of their regulatory actions on State and local governments.
Where such actions have federalism implications, agencies are directed
to provide a statement included in the preamble to the regulations
describing the agency's consideration in terms of the three categories
called for under section (6)(b)(2)(B) of Executive Order 13132. In
adherence with verification laws, this final rule allows for little
State agency flexibility on when and how States must match SNAP
recipients with SSA Death Master Files, eDRS records, and PVS records.
FNS understands that State flexibility is important and will work with
each State agency through a waiver process if they can make a
reasonable argument for a more efficient procedure that would still
comply with the law.
Was there prior consultation with State officials?
Prior to drafting this final rule, FNS consulted with State and
local agencies at various times. FNS regional offices have formal and
informal discussions with State and local officials on an ongoing basis
regarding program implementation and policy issues. This arrangement
allows State and local agencies to provide comments that form the basis
for many discretionary decisions in this and other SNAP rules. FNS has
responded to numerous written requests for policy guidance on IPV
disqualification data reporting. Also, guidance for the prisoner
verification and deceased data matching programs were implemented by
agency directive with the consultation and input from State and local
SNAP agencies. Finally, FNS presented ideas and received feedback on
Program policy at various National, State, and professional conferences
regarding the matching requirements in this rule.
What is the nature of concern and the need to issue this rule?
FNS believes that it is important to standardize matching
procedures to provide quality services to all SNAP participants and
qualified applicants while ensuring that SNAP benefits are issued only
to qualified individuals and households. In doing so, FNS and State
agencies contribute to the success and integrity of the Program,
garnering public support and user confidence in SNAP.
State and local SNAP agencies, however, want flexibility in Program
administration. To the extent possible, FNS will consider alternate
means of meeting the objectives of the law and has considered State
comments in finalizing this rule.
What is the extent to which FNS meets those concerns?
This rule contains changes that are required by law and were
implemented by agency directives in response to the implementation
timeframes required in legislation. The changes to SNAP rules
describing State agency responsibility for reporting IPV information
will clarify how State agencies access disqualification information and
follow-up on it, as well as provide for greater flexibility to State
agencies for processing, retaining and sharing disqualification
information. FNS is not aware of any case where the discretionary
provision of this rule would preempt State law.
Executive Order 12988
FNS has considered the impact of the final rule on State and local
agencies. This rule is intended to have a preemptive effect with
respect to any State and local laws, regulations or policies, which
conflict with its provisions or would otherwise impede its full
implementation. Prior to any judicial challenge to the provisions of
this rule, or the application of its provisions, all applicable
administrative procedures must be exhausted.
This rule makes changes to the verification procedures for prisoner
and deceased person data match programs, as well as reinforces
requirements for disqualified recipient reporting and computer match
benefits adjustments, as required by law. These procedures for matching
prisoner and deceased persons were implemented by agency directives in
May 1999 and February 2000, respectively, in response to implementation
timeframes required in legislation. These changes to SNAP rules
describing State agency responsibilities for reporting IPV information
will clarify access and follow-up procedures for processing, retaining
and sharing disqualification information.
Executive Order 13175
Executive Order 13175 requires Federal agencies to consult and
coordinate with Tribes on a government-to-government basis on policies
that have Tribal implications, including regulations, legislative
comments or proposed legislation, and other policy statements or
actions that have substantial direct effects on one or more Indian
Tribes, on the relationship between the Federal Government and Indian
Tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian Tribes. In late 2010 and early 2011,
USDA engaged in a series of consultative sessions to obtain input by
Tribal officials or their designees concerning the effect of this and
other rules on Tribes or Indian Tribal governments, or whether this
rule may preempt Tribal law.
Reports from the consultative sessions will be made part of the
USDA annual reporting on Tribal Consultation and Collaboration. USDA
will offer future opportunities, such as webinars and teleconferences,
for collaborative conversations with Tribal leaders and their
representatives concerning ways to improve rules with regard to their
affect on Indian country.
We are unaware of any current Tribal laws that could be in conflict
with the final rule.
Civil Rights Impact Analysis
FNS has reviewed this rule in accordance with Department Regulation
4300-4, ``Civil Rights Impact Analysis,'' to identify and address any
major civil rights impacts the rule might have on minorities, women and
persons with disabilities. After careful review of the rule's intent
and provisions, and the characteristics of SNAP households and
individual participants, FNS has determined that there is no way to
determine their effect on any of the protected classes. The changes
required to be implemented by law have already been implemented and are
further clarified in this regulation. Regulations in Sec. 272.6
specifically state that ``State agencies shall not discriminate against
any applicant or participant in any aspect of program administration,
including, but not limited to, the certification of households, the
issuance of coupons, the conduct of fair hearings, or the conduct of
any other program service for reasons of age, race, color, sex,
handicap, religious creed, national origin, or political beliefs.''
Discrimination in any aspect of program administration is
prohibited, stated in Sec. 272.6 and title VI of the Civil Rights Act
of 1964 (42 U.S.C. 2000d). Enforcement action may be brought under any
applicable federal law, thus enabling FNS to implement verification
standards mandating that SNAP State agencies systematize their
application process. This would ensure that those who qualify are given
a just amount of
[[Page 48055]]
SNAP support and that those that do not qualify are prohibited from
receiving SNAP benefits. Title VI complaints shall be processed in
accordance with 7 CFR part 15. Where State agencies have options, and
they choose to implement a certain provision, they must implement it in
such a way that it complies with the regulations in Sec. 272.6.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; see 5 CFR
part 1320), requires that the Office of Management and Budget (OMB)
approve all collections of information by a Federal agency from the
public before they can be implemented. Respondents are not required to
respond to any collection of information unless it displays a current,
valid OMB control number. This rule does not contain new information
collection requirements subject to approval by OMB under the Paperwork
Reduction Act of 1995. Information collection requirements and burden
associated with this rule have been approved as part of OMB
0584-0064, ``Application and Certification of Food Stamp Program
Households'' (expiration March 2013) and OMB 0584-0492, ``SNAP
Repayment Demand and Program Disqualification'' (expiration September
2014).
E-Government Act Compliance
FNS is committed to complying with the E-Government Act of 2002, to
promote the use of the Internet and other information technologies to
provide increased opportunities for citizen access to government
information and services, and for other purposes. The information
collection associated with this regulation is available for electronic
submission through eDRS, which complies with the Paperwork Reduction
Act.
List of Subjects
7 CFR Part 272
Civil rights, Supplemental Nutrition Assistance Program, Grant
programs-social programs, Reporting and recordkeeping requirements.
7 CFR Part 273
Administrative practice and procedure, Claims, Supplemental
Nutrition Assistance Program, Fraud, Grant programs-social programs,
Penalties, Reporting and recordkeeping requirements, Social Security.
For the reasons set out in the preamble, 7 CFR parts 272 and 273
are amended as follows:
0
1. The authority citation for parts 272 and 273 continues to read as
follows:
Authority: 7 U.S.C. 2011-2036.
PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES
0
2. In Sec. 272.1, paragraph (f) is revised to read as follows:
Sec. 272.1 General terms and conditions.
* * * * *
(f) Retention of records. Each State agency shall retain all
Program records in an orderly fashion for audit and review purposes for
no less than 3 years from the month of origin of each record. In
addition:
(1) The State agency shall retain fiscal records and accountable
documents for 3 years from the date of fiscal or administrative
closure. Fiscal closure means that obligations for or against the
Federal government have been liquidated. Administrative closure means
that the State agency has determined and documented that no further
action to liquidate the obligation is appropriate. Fiscal records and
accountable documents include, but are not limited to, claims and
documentation of lost benefits.
(2) Case records relating to intentional Program violation
disqualifications and related notices to the household shall be
retained indefinitely until the State agency obtains reliable
information that the record subject has died or until FNS advises via
the disqualified recipient database system edit report that all records
associated with a particular individual, including the disqualified
recipient database record, may be permanently removed from the database
because of the individual's 80th birthday.
(3) Disqualification records submitted to the disqualified
recipient database must be purged by the State agency that submitted
them when the supporting documents are no longer accurate, relevant, or
complete. The State agency shall follow a prescribed records management
program to meet this requirement. Information about this program shall
be available for FNS review.
* * * * *
0
3. New Sec. Sec. 272.12, 272.13, and 272.14 are added to read as
follows:
Sec. 272.12 Computer matching requirements.
(a) General purpose. The Computer Matching and Privacy Protection
Act (CMA) of 1988, as amended, addresses the use of information from
computer matching programs that involve a Federal System of Records.
Each State agency participating in a computer matching program shall
adhere to the provisions of the CMA if it uses an FNS system of records
for the following purposes:
(1) Establishing or verifying initial or continuing eligibility for
Federal Benefit Programs;
(2) Verifying compliance with either statutory or regulatory
requirements of the Federal Benefit Programs; or
(3) Recouping payments or delinquent debts under such Federal
Benefit Programs.
(b) Matching agreements. State agencies must enter into written
agreements with USDA/FNS, consistent with 5 U.S.C. 552a(o) of the CMA,
in order to participate in a matching program involving a USDA/FNS
Federal system of records.
(c) Use of computer matching information. (1) A State agency shall
not take any adverse action to terminate, deny, suspend, or reduce
benefits to an applicant or recipient based on information produced by
a Federal computer matching program that is subject to the requirements
of the CMA, unless:
(i) The information has been independently verified by the State
agency (in accordance with the independent verification requirements
set out in the State agency's written agreement as required by
paragraph (b) of this section) and a Notice of Adverse Action or Notice
of Denial has been sent to the household, in accordance with Sec.
273.2(f); or
(ii) The Federal agency's Data Integrity Board has waived the two-
step independent verification and notice requirement and notice of
adverse action has been sent to the household, in accordance with Sec.
273.2(f) of this chapter.
(2) A State agency which receives a request for verification from
another State agency, or from FNS pursuant to the provisions of Sec.
273.16(i) of this chapter shall, within 20 working days of receipt,
respond to the request by providing necessary verification (including
copies of appropriate documentation and any statement that an
individual has asked to be included in their file).
Sec. 272.13 Prisoner verification system (PVS).
(a) General. Each State agency shall establish a system to monitor
and prevent individuals who are being held in any Federal, State, and/
or local detention or correctional institutions for more than 30 days
from being included in a SNAP household.
(b) Use of match data. State prisoner verification systems shall
provide for:
(1) The comparison of identifying information about each household
[[Page 48056]]
member, excluding minors, as that term is defined by each State, and
one-person households in States where a face-to-face interview is
conducted, against identifying information about inmates of
institutions at Federal, State and local levels;
(2) The reporting of instances where there is a match;
(3) The independent verification of match hits to determine their
accuracy;
(4) Notice to the household of match results;
(5) An opportunity for the household to respond to the match prior
to an adverse action to deny, reduce, or terminate benefits; and
(6) The establishment and collections of claims as appropriate.
(c) Match frequency. State agencies shall make a comparison of
match data for adult household members at the time of application and
at recertification. States that opt to obtain and use prisoner
information collected under Section 1611(e)(1)(I)(i)(I) of the Social
Security Act (42 U.S.C. 1382(e)(1)(I)(i)(I)) shall be considered in
compliance with this section. States shall enter into a computer
matching agreement with the SSA under authority contained in 42 U.S.C.
405(r)(3).
Sec. 272.14 Deceased matching system.
(a) General. Each State agency shall establish a system to verify
and ensure that benefits are not issued to individuals who are
deceased.
(b) Data source. States shall use the SSA's Death Master File,
obtained through the State Verification and Exchange System (SVES) and
enter into a computer matching agreement with SSA pursuant to authority
to share data contained in 42 U.S.C. 405(r)(3).
(c) Use of match data. States shall provide a system for:
(1) Comparing identifiable information about each household member
against information from databases on deceased individuals. States
shall make the comparison of matched data at the time of application
and no less frequently than once a year.
(2) The reporting of instances where there is a match;
(3) The independent verification of match hits to determine their
accuracy;
(4) Notice to the household of match results;
(5) An opportunity for the household to respond to the match prior
to an adverse action to deny, reduce, or terminate benefits; and
(6) The establishment and collection of claims as appropriate.
PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS
0
4. In Sec. 273.2, a new paragraph (f)(11) is added to read as follows:
Sec. 273.2 Office operations and application processing.
* * * * *
(f) * * *
(11) Use of disqualification data. (i) Pursuant to Sec. 273.16(i),
information in the disqualified recipient database will be available
for use by any State agency that executes a computer matching agreement
with FNS. The State agency shall use the disqualified recipient
database for the following purposes:
(A) Ascertain the appropriate penalty to impose based on past
disqualifications in a case under consideration;
(B) Conduct matches as specified in Sec. 273.16 on:
(1) Program application information prior to certification and for
a newly added household member whenever that might occur; and
(2) The current recipient caseload at the time of recertification
for a period of 1 year after the implementation date of this match.
State agencies do not need to include minors, as that term is defined
by each State.
(3) States having the ability to conduct a one-time match of their
entire active caseload against active cases from the disqualified
recipient database may do so and be exempted from the 1-year
requirement to conduct matches at recertification.
(ii) State agencies shall not take any adverse action to terminate,
deny, suspend, or reduce benefits to an applicant, or SNAP recipient,
based on disqualified recipient match results unless the match
information has been independently verified. The State agency shall
provide to an applicant, or recipient, an opportunity to contest any
adverse disqualified recipient match result pursuant to the provisions
of Sec. 273.13.
(iii) Independent verification shall take place separate from and
prior to issuing a notice of adverse action--a two-step process.
Independent verification for disqualification purposes means contacting
the applicant or recipient household and/or the State agency that
originated the disqualification record immediately to obtain
corroborating information or documentation to support the reported
disqualification information in the intentional Program violation
database.
(A) Documentation may be in any form deemed appropriate and legally
sufficient by the State agency considering the adverse action. Such
documentation may include, but shall not be limited to, electronic or
hard copies of court decisions, administrative disqualification hearing
determinations, signed disqualification consent agreements or
administrative disqualification hearing waivers.
(B) A State may accept a verbal or written statement from another
State agency attesting to the existence of the documentation listed in
paragraph (f)(11)(iii)(A) of this section.
(C) A State may accept a verbal or written statement from the
household affirming the accuracy of the disqualification information if
such a statement is properly documented and included in the case
record.
(D) If a State agency is not able to provide independent
verification because of a lack of supporting documentation, the State
agency shall so advise the requesting State agency or FNS, as
appropriate, and shall take immediate action to remove the unsupported
record from the disqualified recipient database in accordance with
Sec. 273.16(i)(6).
(iv) Once independent verification has been received, the
requesting State agency shall review and immediately enter the
information into the case record and send the appropriate notice(s) to
the record subject and any remaining members of the record subject's
SNAP household.
(v) Information from the disqualified recipient database is subject
to the disclosure provisions in Sec. 272.1(c) of this chapter and the
routine uses described in the most recent ``Notice of Revision of
Privacy Act System of Records'' published in the Federal Register.
* * * * *
0
5. In Sec. 273.11, paragraph (c)(4)(i) is amended by adding a new
sentence to the end of the paragraph to read as follows:
Sec. 273.11 Action on households with special circumstances.
* * * * *
(c) * * *
(4) * * *
(i) * * * However, a participating household is entitled to a
notice of adverse action prior to any action to reduce, suspend or
terminate its benefits, if a State agency determines that it contains
an individual who was disqualified in another State and is still within
the period of disqualification.
* * * * *
0
6. In Sec. 273.12:
0
a. The section heading is revised:
0
b. Paragraph (e)(3) introductory text is amended by removing the last
six
[[Page 48057]]
sentences and adding four new sentences in their place.
0
c. New paragraphs (e)(3)(i) and (e)(3)(ii) are added; and
0
d. The introductory text of paragraph (e)(4) is revised.
The additions and revision read as follows:
Sec. 273.12 Requirements for change reporting households.
* * * * *
(e) * * *
(3) * * * A State agency may require households to report the
change on the appropriate monthly report or may handle the change using
the mass change procedures in this section. If the State agency
requires the household to report the information on the monthly report,
the State agency shall handle such information in accordance with its
normal procedures. Households that are not required to report the
change on the monthly report, and households not subject to monthly
reporting, shall not be responsible for reporting these changes. The
State agency shall be responsible for automatically adjusting these
households' SNAP benefit levels in accordance with either paragraph
(e)(3)(i) or (e)(3)(ii) of this section.
(i) The State agency may make mass changes by applying percentage
increases communicated by the source agency to represent cost-of-living
increases provided in other benefit programs. These changes shall be
reflected no later than the second allotment issued after the month in
which the change becomes effective.
(ii) The State agency may update household income information based
on cost-of-living increases supplied by a data source covered under the
Computer Matching and Privacy Protection Act of 1988 (CMA) in
accordance with Sec. 272.12 of this chapter. The State agency shall
take action, including proper notices to households, to terminate, deny
or reduce benefits based on this information if it is considered
verified upon receipt under Sec. 273.2(f)(9). If the information is
not considered verified upon receipt, the State agency shall initiate
appropriate action and notice in accordance with Sec. 273.2(f)(9).
(4) Notice for mass change. When the State agency makes a mass
change in SNAP eligibility or benefits by simultaneously converting the
caseload, or that portion of the caseload that is affected, using the
percentage increase calculation provided for in Sec. 273.12(e)(3)(i),
or by conducting individual desk reviews using information not covered
under the Computer Matching and Privacy Protection Act (CMA) in place
of a mass change, it shall notify all households whose benefits are
reduced or terminated in accordance with the requirements of this
paragraph, except for mass changes made under Sec. 273.12(e)(1); and
* * * * *
0
7. In Sec. 273.13:
0
a. Paragraph (a)(2) is amended by adding two new sentences to the end
of the paragraph;
0
b. Paragraph (b)(1) is revised; and
0
c. Paragraph (b)(7) is amended by removing the first sentence of the
paragraph and adding three new sentences in its place.
The additions and revision read as follows:
Sec. 273.13 Notice of adverse action.
(a) * * *
(2) * * * A notice of adverse action that combines the request for
verification of information received through an IEVS computer match
shall meet the requirements in Sec. 273.2(f)(9). A notice of adverse
action that combines the request for verification of information
received through a SAVE computer match shall meet the requirements in
Sec. 273.2(f)(10).
* * * * *
(b) * * *
(1) The State initiates a mass change through means other than
computer matches as described in Sec. 273.12(e)(1), (e)(2), or
(e)(3)(i).
* * * * *
(7) A household member is disqualified for an intentional Program
violation in accordance with Sec. 273.16, or the benefits of the
remaining household members are reduced or terminated to reflect the
disqualification of that household member, except as provided in Sec.
273.11(c)(3)(i). A notice of adverse action must be sent to a currently
participating household prior to the reduction or termination of
benefits if a household member is found through a disqualified
recipient match to be within the period of disqualification for an
intentional Program violation penalty determined in another State. In
the case of applicant households, State agencies shall follow the
procedures in Sec. 273.2(f)(11) for issuing notices to the
disqualified individual and the remaining household members. * * *
* * * * *
0
8. In Sec. 273.16, paragraph (i) is revised to read as follows:
Sec. 273.16 Disqualification for intentional program violation.
* * * * *
(i) Reporting requirements. (1) Each State agency shall report to
FNS information concerning individuals disqualified for an intentional
Program violation, including those individuals disqualified based on
the determination of an administrative disqualification hearing
official or a court of appropriate jurisdiction, and those individuals
disqualified as a result of signing either a waiver of right to a
disqualification hearing or a disqualification consent agreement in
cases referred for prosecution. This information shall be submitted to
FNS so that it is received no more than 30 days after the date the
disqualification took effect.
(2) State agencies shall report information concerning each
individual disqualified for an intentional Program violation to FNS.
FNS will maintain this information and establish the format for its
use.
(i) State agencies shall report information to the disqualified
recipient database in accordance with procedures specified by FNS.
(ii) State agencies shall access disqualified recipient information
from the database that allows users to check for current and prior
disqualifications.
(3) The elements to be reported to FNS are name, social security
number, date of birth, gender, disqualification number,
disqualification decision date, disqualification start date, length of
disqualification period (in months), locality code, and the title,
location and telephone number of the locality contact. These elements
shall be reported in accordance with procedures prescribed by FNS.
(i) The disqualification decision date is the date that a
disqualification decision was made at either an administrative or
judicial hearing, or the date an individual signed a waiver to forego
an administrative or judicial hearing and accept a disqualification
penalty.
(ii) The disqualification start date is the date the
disqualification penalty was imposed by any of the means identified in
Sec. 273.16(i)(3)(i).
(iii) The locality contact is a person, position or entity
designated by a State agency as the point of contact for other State
agencies to verify disqualification records supplied to the
disqualified recipient database by the locality contact's State.
(4) All data submitted by State agencies will be available for use
by any State agency that is currently under a valid signed Matching
Agreement with FNS.
(i) State agencies shall, at a minimum, use the data to determine
the eligibility of individual Program applicants prior to
certification, and for 1 year following implementation, to determine
the
[[Page 48058]]
eligibility at recertification of its currently participating caseload.
In lieu of the 1-year match at recertification requirement and for the
same purpose, State agencies may conduct a one-time match of their
participating caseload against active disqualifications in the
disqualified recipient database. State agencies have the option of
exempting minors from this match.
(ii) State agencies shall also use the disqualified recipient
database for the purpose of determining the eligibility of newly added
household members.
(5) The disqualification of an individual for an intentional
Program violation in one political jurisdiction shall be valid in
another. However, one or more disqualifications for an intentional
Program violation, which occurred prior to April 1, 1983, shall be
considered as only one previous disqualification when determining the
appropriate penalty to impose in a case under consideration, regardless
of where the disqualification(s) took place. State agencies are
encouraged to identify and report to FNS any individuals disqualified
for an intentional Program violation prior to April 1, 1983. A State
agency submitting such historical information should take steps to
ensure the availability of appropriate documentation to support the
disqualifications in the event it is contacted for independent
verification.
(6) If a State determines that supporting documentation for a
disqualification record that it has entered is inadequate or
nonexistent, the State agency shall act to remove the record from the
database.
(7) If a court of appropriate jurisdiction reverses a
disqualification for an intentional Program violation, the State agency
shall take action to delete the record in the database that contains
information related to the disqualification that was reversed in
accordance with instructions provided by FNS.
(8) If an individual disputes the accuracy of the disqualification
record pertaining to him/herself the State agency submitting such
record(s) shall be responsible for providing FNS with prompt
verification of the accuracy of the record.
(i) If a State agency is unable to demonstrate to the satisfaction
of FNS that the information in question is correct, the State agency
shall immediately, upon direction from FNS, take action to delete the
information from the disqualified recipient database.
(ii) In those instances where the State agency is able to
demonstrate to the satisfaction of FNS that the information in question
is correct, the individual shall have an opportunity to submit a brief
statement representing his or her position for the record. The State
agency shall make the individual's statement a permanent part of the
case record documentation on the disqualification record in question,
and shall make the statement available to each State agency requesting
an independent verification of that disqualification.
* * * * *
Dated: July 10, 2012.
Kevin Concannon,
Under Secretary, Food, Nutrition, and Consumer Services.
[FR Doc. 2012-19768 Filed 8-10-12; 8:45 am]
BILLING CODE 3410-30-P