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decided: August 16, 1988.


Appeal from the order of the Department of Public Welfare, in the case of Appeal Of: Sheree L. Clark, Case No. 100036615, dated October 15, 1987.


Maureen Dunn Harvey, with her, William P. Chapas, Wallace, Chapas & Associates, for petitioner.

Jeffrey P. Schmoyer, Assistant Counsel, with him, Jason W. Manne, Assistant Counsel, and John Kane, Chief Counsel, for respondent.

Judges Craig, McGinley, and Senior Judge Narick, sitting as a panel of three. Opinion by Judge Craig.

Author: Craig

[ 118 Pa. Commw. Page 588]

Sheree L. Clark, claimant, appeals a decision of the Department of Public Welfare (DPW), Office of Hearings and Appeals, denying her application for AFDC and food stamp (FS) assistance. We are compelled to affirm the DPW decision.

[ 118 Pa. Commw. Page 589]

The claimant has two minor children, Lyric and Leland. Since May, 1984, Leland has received a monthly award of $1,069 from a structured settlement of a medical malpractice suit. The issue is whether that award constitutes income which renders the household ineligible for the assistance in question.

On July 7, 1987, the claimant applied for AFDC assistance for herself and Lyric, and for food stamps for the entire family. DPW denied the claimant's application, stating that regulations required that Leland must be included as a member of the mandatory filing unit, and that his monthly income of $1,069 put the income of the household filing group above income eligibility guidelines. DPW instead authorized Transitionally Needy (TN) General Assistance (GA) of $186 per month for the claimant alone. The claimant filed a timely appeal of DPW's decision. Following a hearing on September 15, 1987, the hearing officer affirmed the denial of the claimant's AFDC and FS assistance application.

Our scope of review of a DPW decision is limited to a determination of whether the adjudication is supported by substantial evidence, is in accordance with law, or whether constitutional rights were violated. Nelson v. Department of Public Welfare, 103 Pa. Commonwealth Ct. 21, 519 A.2d 1062 (1986). We also recognize that an administrative agency's interpretation of its own regulations is controlling unless the interpretation is plainly erroneous or inconsistent with either the regulation or the statute under which it is promulgated. Department of Public Welfare v. Forbes Health System, 492 Pa. 77, 422 A.2d 480 (1980).

On appeal, the claimant argues that DPW erred as a matter of law by treating the monies from Leland's personal injury settlement as "income" for the purpose of determining AFDC and food stamp eligibility for herself and Lyric. Alternatively, if Leland's cash allowance

[ 118 Pa. Commw. Page 590]

    does constitute "income," the claimant argues that it is legally-restricted income which, under 55 Pa. Code § 183.44, is unavailable for the support of his mother and sister. DPW responds that changes in federal regulations mandate that Leland and his settlement income be considered when determining the family's eligibility for assistance.

The AFDC program is a cooperative federal and state effort established by Congress to enable the states to furnish financial assistance to certain needy children and the parents or relatives with whom they live. Oliver v. Ledbetter, 624 F. Supp. 325 (N.D. Ga. 1985), aff'd 821 F.2d 1507 (11th Cir. 1987). Participating states that provide financial assistance to eligible families receive partial reimbursement from the federal government. In Pennsylvania, DPW administers the program, establishing rules, regulations and standards for eligibility. These regulations are codified at 55 Pa. Code §§ 171 to 187. The Public Welfare Code, section 403(b),*fn1 provides in pertinent part that "the Secretary shall issue interim regulations whenever changes in federal laws and regulations supersede existing statutes." These interim regulations are distributed to county assistance offices through Income Maintenance Bulletins (IMB) and temporary pages containing amendments to the DPW Public Assistance Eligibility Manual (PAEM).

In order to qualify for AFDC benefits, applicants must meet certain standards of financial need, defined by their income and resources. Before 1984, federal regulations did not require that all co-resident family members be included in the family unit for AFDC assistance purposes. A family applying for assistance could exclude from the filing unit those family members

[ 118 Pa. Commw. Page 591]

    with income that, if counted in the family's net income, would reduce the amount of the family's AFDC benefits.

These rules changed when Congress passed the Deficit Reduction Act of 1984, revising section 402(a)(38) of the Social Security Act, 42 U.S.C. § 602(a)(38). Federal regulations now provide that a state AFDC plan must include any brother or sister living in the same house as the child applying for benefits. 42 U.S.C. § 602(a)(38); 45 C.F.R. § 206.10(a)(1)(vii)(B). Since October 1, 1984, the Secretary of Health and Human Services has required that all income of siblings and half-siblings residing in the same househould as AFDC recipients be ...

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