Muckey v. New Mexico Department of Human Services

694 P.2d 521, 102 N.M. 265
CourtNew Mexico Court of Appeals
DecidedJanuary 8, 1985
Docket7690
StatusPublished
Cited by8 cases

This text of 694 P.2d 521 (Muckey v. New Mexico Department of Human Services) is published on Counsel Stack Legal Research, covering New Mexico Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Muckey v. New Mexico Department of Human Services, 694 P.2d 521, 102 N.M. 265 (N.M. Ct. App. 1985).

Opinion

OPINION

MINZNER, Judge.

Appellant Lloyd Muckey, a recipient of Aid to Families with Dependent Children (AFDC) benefits, appeals a decision by the New Mexico Human Services Department (HSD) that affirmed county action terminating those benefits. We affirm.

In the summer of 1983 Muckey, on behalf of himself, his wife, and two children, began receiving financial and medical assistance in the amount of $281 monthly through the AFDC program. In August 1983, over a period of three days, the Muckeys received a number of unemployment compensation checks as a result of a successful appeal in another state. The Muckeys received no other income during August.

HSD considered the sum the Muckeys received a nonrecurring lump sum payment to which 1 HSD Income Support Division Program Manual (ISDP Manual), Section 221.832(A) (revised September 1, 1982) (the “lump sum rule”) applied. As a result, HSD determined the family was ineligible for financial and medical assistance. Prior to that time, however, the Muckeys had expended much of the money on basic household expenses and to repay preexisting debts.

Muckey argues that HSD improperly applied the lump sum rule. His argument has several parts:

(1) whether the lump sum rule is unconstitutional;
(2) whether the money received constitutes “available” income under 45 C.F.R. Section 233.20(a)(3)(ii)(D) (1983);
(3) whether the lump sum rule applied when the Muckeys received no earned income during the same month in which the lump sum was received;
(4) whether HSD is estopped from applying the lump sum rule due to inadequate information supplied by the agency; and
(5) whether an exception to ineligibility applies due to a life-threatening circumstance in the family unit.

The first, second, and third issues are related, because resolving them requires resort to legislative history. Therefore, we address these three issues together.

This court may set aside the decision of the administrative agency only if it is (1) arbitrary, capricious, or an abuse of discretion; (2) not supported by substantial evidence in the record as a whole; or (3) otherwise not in accordance with law. NMSA 1978, § 27-3-4(F) (Repl.Pamp.1984). In reviewing the agency’s factual decisions, we must view the evidence in the light most favorable to the decision. New Mexico Human Services Department v. Garcia, 94 N.M. 175, 608 P.2d 151 (1980).

I. THE APPLICABILITY OF THE LUMP SUM RULE

The Muckeys were receiving AFDC benefits under a joint federal-state program. See 42 U.S.C.A. §§ 601-615 (1983). Under the program, the state administers federal funds, and the state plan must comply with federal statutes and regulations. By providing the benefits, Congress intended to encourage the care of dependent children in their homes. The program furnishes financial assistance to needy, dependent children by making payments to a relative who cares for them. 42 U.S.C.A. § 601.

In 1981 Congress amended the provision primarily at issue in this case, 42 U.S.C.A. Section 602(a)(17), as part of a complex and extensive attempt to cut the federal budget. The amendment to Section 602(a)(17) created the lump sum rule, Omnibus Budget Reconciliation Act of 1981, Pub.L. No. 97-35, § 2304, 95 Stat. 357, 845. The federal agency in charge of administering AFDC in turn published final regulations implementing the lump sum rule. See 45 C.F.R. § 233.20(a)(3)(ii)(D).

The amendment required that state AFDC plans incorporate the lump sum rule. The New Mexico version in force on the date of the hearing complied with the federal statute. It stated in pertinent part:

If the AFDC budget group or any other individual whose income is counted in determining the budget group’s need receives, beginning with the month of application, a non-recurring [sic] lump sum payment which[,] together with all income for that month after allowable disregards^] exceeds the Department’s standard of need applicable to the family[,] such amount of income shall be considered income in the payment month and the family shall be ineligible for aid for the whole number of months that equals the sum of the non-recurring [sic] lump sum and all other income after allowable disregards received in such month divided by the standard of need applicable to such family (i.e.[,] the budget group plus any other individual whose lump sum income is considered in determining the period of ineligibility). Any income remaining (which amount is less than the applicable monthly standard) shall be treated as income received, in the first month following the period of ineligibility determined under this Section.

ISDP Manual § 221.832(A), at 37.

In New Mexico and elsewhere, the rule provides, with certain exceptions, that the receipt of a lump sum disqualifies the recipient family from obtaining a like amount in federal aid. The disqualification persists for the period of time the lump sum would cover were it disbursed as monthly AFDC allotments. Thus, the caseworker, having divided the sum the Muckeys said they received by the monthly allotment, calculated that benefits would be suspended for nine months.

Muckey argues that the lump sum rule violates the due process clause because it conclusively presumes that the sum will be available for use by the family during the entire period of ineligibility. As we understand the rule, however, it does not require continuing availability of the money. Apparently Congress had two purposes in enacting the present rule: “to promote responsible budgeting of lump-sum income by all AFDC families and to reduce AFDC disbursements by a specified amount based on calculations that had assumed application of the lump-sum rule to all AFDC families, not only to those AFDC families with earned income.” Sweeney v. Murray, 732 F.2d 1022, 1027 (1st Cir.1984). Congress specifically noted that prior practice, under which AFDC payments resumed as soon as the lump sum was expended, had a “perverse effect,” because it encouraged a family to spend a lump sum as quickly as possible. Id.

The purposes behind the present rule do not require continuing availability. The present rule does not create an unconstitutional presumption; rather, it limits the availability of scarce resources. Cf. National Potash Co. v. Property Tax Division of Taxation & Revenue Department, 101 N.M. 404, 683 P.2d 521 (Ct.App.1984) (method of taxation held not to establish an irrebuttable presumption). Congress in effect restricted AFDC benefits.

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Bluebook (online)
694 P.2d 521, 102 N.M. 265, Counsel Stack Legal Research, https://law.counselstack.com/opinion/muckey-v-new-mexico-department-of-human-services-nmctapp-1985.