[Federal Register Volume 65, Number 210 (Monday, October 30, 2000)]
[Rules and Regulations]
[Pages 64581-64589]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-27483]



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Rules and Regulations
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Federal Register / Vol. 65, No. 210 / Monday, October 30, 2000 / 
Rules and Regulations

[[Page 64581]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Parts 271, 273 and 276

[Amendment No. 381]
RIN 0584-AC41


Food Stamp Program: Non-Discretionary Provisions of the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rule finalizes a proposed rule published July 12, 1999, 
by amending the Food Stamp Program Regulations to implement certain 
non-discretionary provisions of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996 (PRWORA) that affect the Food 
Stamp Program. The regulatory changes include changes in the minimum 
and maximum allotments, the standard and shelter deductions, household 
composition, the fair market value of vehicles, the definition of 
homeless, and expedited service. In accordance with the proposal, this 
rule also incorporates, where possible, the principles of the 
President's Regulatory Reform Initiative and removes overly 
prescriptive, outdated, and redundant provisions, and increases State 
agency flexibility.

DATES:   
    Effective Date: This final rule is effective December 29, 2000.
    Implementation Dates:
    1. The following amendments were to be implemented August 22, 1996: 
The definition of ``Homeless individual'' in Sec. 271.2, 
Sec. 273.1(b)(1)(ii), Sec. 273.2(i)(3)(i) and (i)(3)(ii).
    2. The amendments to Sec. 273.8(f)(1) and Sec. 273.10(e)(4)(ii) 
were to be implemented October 1, 1996.
    3. The amendment to Sec. 273.9(d)(8) was to be implemented January 
1, 1997.
    4. The amendments to Sec. 273.1(b)(1)(iii) and 
Sec. 273.8(e)(3)(i)(A), are to be implemented no later than March 1, 
2001.
    5. All remaining amendments are to be implemented no later than 
January 1, 2001.

FOR FURTHER INFORMATION CONTACT: Margaret Werts Batko, Certification 
Policy Branch, Program Development Division, Food and Nutrition 
Service, USDA, 3101 Park Center Drive, Alexandria, Virginia, 22302, 
(703) 305-2520, or e-mail at <a href="/cdn-cgi/l/email-protection#0b466a796c6a796e7f25496a7f60644b6d6578257e786f6a256c647d"><span class="__cf_email__" data-cfemail="175a76657076657263395576637c7857717964396264737639707861">[email protected]</span></a>. A regulatory 
impact analysis has been prepared for this rule. You may request a copy 
of the analysis by contacting us at the above address.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be economically significant under 
Executive Order 12866, and major under Pub. L. 104-121, and has, 
therefore, been reviewed by the Office of Management and Budget (OMB).

Executive Order 13132

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. FNS 
has considered the impact on State agencies. This rule deals almost 
entirely with changes required by law, and implemented by law in 1996. 
The changes primarily affect food stamp recipients. The effects on 
State agencies are minimal and, to the extent that they affect them, 
relieve them of administrative burdens. This rule is intended to have 
preemptive effect on any State law that conflicts with its provisions 
or that would otherwise impede its full implementation. PRWORA required 
all but one of the changes made in this rule, and made most of them 
effective on enactment and all of them effective by the beginning of FY 
1997. FNS is not aware of any case where the one discretionary 
provision of the rule would preempt State law.

Prior Consultation With State Officials

    Before drafting this rule, we received input from State agencies at 
various times. Because the FSP is a State administered, federally 
funded program, our regional offices have formal and informal 
discussions with State and local officials on an ongoing basis. These 
discussions involve implementation and policy issues. This arrangement 
allows State agencies to provide feedback that forms the basis for many 
discretionary decisions in this and other FSP rules. In addition, FNS 
officials attend regional, national, and professional conferences to 
discuss issues and receive feedback from State officials at all levels. 
Lastly, the comments on the proposed rule from State officials were 
carefully considered in drafting this final rule.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612). Shirley R. 
Watkins, Under Secretary for Food, Nutrition, and Consumer Services, 
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. Participants will be affected to the extent 
that their benefits will not increase at the rate they would have under 
the old law.

Paperwork Reduction Act

    This proposed rule does not contain reporting or record keeping 
requirements subject to approval by OMB under the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3507).

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This final rule is intended to have preemptive effect 
with respect to any State or local laws, regulations or policies that 
conflict with its provisions or that would otherwise impede its full 
implementation. This final rule is not intended to have retroactive 
effect unless so specified in the ``Dates'' paragraph of this rule. 
Prior to any judicial challenge to the provisions of this rule or the 
application of its provisions, all applicable administrative procedures 
must be exhausted. In the Food Stamp Program the administrative 
procedures are as follows: (1) For Program benefit recipients--State 
administrative procedures issued pursuant to 7 U.S.C. 2020(e)(1) and 7

[[Page 64582]]

CFR 273.15; (2) for State agencies--administrative procedures issued 
pursuant to 7 U.S.C. 2023 set out at 7 CFR 276.7 (for rules related to 
non-quality control (QC) liabilities) or Part 283 (for rules related to 
QC liabilities); (3) for retailers and wholesalers--administrative 
procedures issued under 7 U.S.C. 2023 set out at 7 CFR 278.8 and Part 
279.

Unfunded Mandate Analysis

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Pub. L. 
104-4, establishes 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 the UMRA, the 
Department 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 the UMRA 
generally requires the Department 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 the UMRA) that impose costs on State, local, 
or tribal governments or to the private sector of $100 million or more 
in any one year. Thus, this rule is not subject to the requirements of 
sections 202 and 205 of the UMRA.

Regulatory Impact Analysis

Need for Action

    This action is needed to implement several provisions of the 
Personal Responsibility and Work Opportunity Reconciliation Act of 
1996, Pub. L. 104-193. This rule removes the exception in current rules 
that allows persons age 21 and under who are themselves parents or 
married, and who live with a parent, to participate in the Food Stamp 
Program as a separate household; changes the way the maximum allotments 
are calculated by using 100% of the Thrifty Food Plan instead of 103%; 
alters the definition of homeless by setting a time limit (where there 
was none before) on people whose primary nighttime residence is a 
temporary accommodation in the home of another; freezes the standard 
deduction in food stamps for fiscal year 1997 and beyond at $134; 
retains a cap on the excess shelter expense deduction; freezes the fair 
market value of vehicle exemption at $4,650; freezes the minimum 
allotment at $10 a month; increases the number of days which States 
have to provide expedited service from 5 to 7 calendar days; eliminates 
households consisting entirely of homeless people from those categories 
of households entitled to receive expedited service; and removes the 
State agency option to exclude from unearned income up to $50 monthly 
of title IV-D child support payments.

Effects on Administering Agencies

    State food stamp offices are affected to the extent that they must 
implement the provisions described in this action. However, State 
agencies are not expected to change their personnel due to these 
changes, so State agencies are expected to incur minimal costs.

Costs

    The final rule does not make any economically significant changes 
to the proposed rule. However, food stamp participation has decreased 
more than expected since we published the proposed rule. Current 
estimates of participation are about 20 percent less than previous 
estimates. Accordingly, total savings in food stamps issued from this 
rule for the 5 years from fiscal year 1998 to 2002 are $9,039 million--
down from the previous estimate of $11,195 million.

Plain Language

    We have written this final rule under the plain language guidelines 
to make it easier to read and clearer. We have edited wording that we 
preserved from the proposed rule to conform to those guidelines, using 
simpler words and phrases where appropriate, and changing sentences 
from passive to active voice. We did not change the meaning of any of 
the language brought from the proposed rule.

Background

    The President signed the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, Pub. L. 104-193 (PRWORA) on 
August 22, 1996. PRWORA contained several provisions that amended the 
Food Stamp Act of 1977 (the Act), 7 U.S.C. 2011, et seq., but allowed 
us (the Food and Nutrition Service of the Department of Agriculture) no 
discretion in implementing them. We published proposed rules on July 
12, 1999, in the Federal Register at 64 FR 37454 to implement those 
provisions. The provisions:
    <bullet> Require that a person 21 years old or younger who lives 
with a parent be considered part of the parent's household, even if 
married and living with a spouse, living with a child, or both;
    <bullet> Set the maximum allotment at 100% of the Thrifty Food 
Plan, rather than at 103%;
    <bullet> Allow a person living in another person's house to be 
considered homeless for only 90 days;
    <bullet> Freeze the standard deduction at $134;
    <bullet> Retain the cap on the excess shelter expense deduction;
    <bullet> Freeze the exemption of the fair market value of a vehicle 
as a household asset at $4,650;
    <bullet> Freeze the minimum allotment for 1- and 2-person 
households at $10;
    <bullet> Increase from 5 to 7 the number of days State agencies 
have to provide expedited service;
    <bullet> Eliminate households consisting entirely of homeless 
persons from the kinds of households automatically allowed to receive 
expedited service; and
    <bullet> Remove the State agency option to exclude up to $50 a 
month of the title IV-D child support payments from unearned income.
    The period for comment on the proposed rules ended September 10, 
1999. We received comments on the proposed rules from ten State 
agencies and an advocacy group. (In addition, the Acting General 
Counsel of a State agency commented on our failure to treat a number of 
discretionary provisions of PRWORA in this rulemaking. Those provisions 
will be covered in other rules that are currently in clearance or which 
have recently been published. We will not deal with them here.) In 
analyzing the comments received, we will not address comments on 
provisions that are required by the law and on which we have no 
discretion. A number of comments supported our proposals. We will not 
discuss those in detail here, either. Finally, a number of the comments 
concerned technical corrections for inadvertent omissions. We have made 
the corrections where appropriate, but will not discuss the comments. 
For a full understanding of the background of the provisions in this 
rule see the proposed rulemaking. In response to those comments that 
need discussion, and for ease of reading, we will discuss each 
provision touched on by those comments, and the comments, in the order 
in which they appear in the Code of Federal Regulations.
    Definition of Parental Control: Although not contemplated by

[[Page 64583]]

PRWORA, to provide the same treatment for a child living with a non-
parent adult that is provided for a child living with a natural or 
adoptive parent or stepparent, we proposed to change the definition of 
parental control, amending 7 CFR 273.1 by removing the exception that a 
child who is living with his or her own child(ren) or spouse is not 
considered to be under parental control. A State agency commented that 
under its State law a married person under 18 has attained majority and 
no other person is responsible for that person. We have amended the 
language of the final rule to accommodate such a situation. Another 
State agency noted our removal of the exception, and stated its 
understanding that it could choose to retain the old policy if it 
applied it consistently across the State. This is incorrect. Our view 
is that a child who is under parental control must be a member of the 
household that exercises parental control, even if the child has 
children of his or her own. However, State agencies will have 
substantial authority to determine parental control.
    Reorganization of 7 CFR 273.1--Household Concept: In the spirit of 
the President's Regulatory Reform Initiative, we proposed to reorganize 
Sec. 273.1 (which deals with the important programmatic concept of 
``household''), with the exception of 7 CFR 273.1(d) and (f), which we 
left unchanged. We did not propose significant changes to Sec. 273.1, 
as nearly every provision is set forth in the Act and can be changed 
only through legislative action. However, we condensed several sections 
into a single section, removing unnecessary language and provisions 
covered elsewhere in the regulations, and providing State agency 
flexibility where possible. The proposed rule set out the entire 
suggested revised text for the convenience of the reader.
    Boarders: To ensure uniformity among all States, we proposed to 
retain in new paragraph (b)(3) the language appearing in 7 CFR 
273.1(c)(1), which defines a boarder. Whether a person is considered to 
be a boarder, and whether, if deemed a boarder, a person may 
participate in the Food Stamp Program, is in part determined by whether 
the person pays reasonable compensation for lodging and meals. A State 
agency, in its comments, asked why not, in the interest of State 
flexibility, allow States to define what constitutes ``reasonable'' 
compensation. However, the State agency did not give any further reason 
to change the existing regulation, and another State agency noted that 
it had no objection to the purely cosmetic change to the provision. 
This provision as written is easy to administer, equitable to clients, 
and adaptable to each State's automated certification system. Moreover, 
it has not been a problem for State agencies or clients in the past. 
For these reasons, and because the Thrifty Food Plan base is a 
practicable way to determine whether a person is paying reasonable 
compensation in order to decide boarder status, and was previously 
subject to public comments, we do not think the definition should be 
changed based on a single comment in this rule.
    An advocate organization commented that we should make it clear 
that the definition of a commercial boarding house does not include 
group homes for disabled, homeless shelters, or other such entities 
that may be licensed under the same State laws as commercial boarding 
houses. Group homes for disabled (group living arrangements), for 
example, are defined in 7 CFR 271.2 as public or private nonprofit 
entities, and proposed 7 CFR 273.1(b)(7)(vii)(E) specified public or 
private nonprofit homeless shelters. We have modified the language of 
the rule to make it clear that the entities excepted from the rule 
barring residents of institutions must not be confused with commercial 
boarding houses.
    When we combined 7 CFR 273.1(a)(2), (b), (c)(1), (c)(3), and (e) in 
new paragraph (b), we eliminated 7 CFR 273.1(c) of current regulations. 
We added a new paragraph (c). There has been some confusion among State 
agencies as to when the policy on ``purchasing food and preparing 
meals'' overrides policy prohibiting the separation of spouses and 
children, or prohibiting the participation of boarders. The new 
paragraph (c) specifically allows State agencies to apply discretion 
when the rule does not lend itself to a simple and direct answer to 
certain living situations. We cannot cover all living situations by 
regulation. We intend that State agencies use prudent judgment in 
determining when to allow individuals to be certified as separate 
households from others with whom they reside and to protect Program 
integrity by not allowing great numbers of households to fragment into 
smaller households. The language also states that any State policy 
adopted under this provision must be applied consistently throughout 
the State.
    A State agency commented that the ``Administrative Procedures Act'' 
requires it to develop rules for any options allowed by Food Stamp 
Program regulations (we presume the State agency was referring to its 
own State Administrative Procedures Act, since States are not subject 
to the Federal Administrative Procedure Act, 5 U.S.C. 500, et seq.). It 
added that if USDA cannot cover all living situations by regulations, a 
State agency cannot be expected to do so and ensure that they are 
handled consistently throughout the State. We recognize that it may be 
difficult for States to spell out clear policies in this area and 
ensure that they are applied across the State, but we are reluctant to 
impose such exacting rules that States cannot adapt the rules to local 
situations. We have, however, added the words ``fairly'' and 
``equitably'' to the rule to ensure that a State agency's policy must 
be not only consistent, but also fair. Moreover, we stand ready to work 
with State agencies on a case-by-case basis to determine whether 
individual cases fit a pattern that should be applied across the State, 
or are unique cases.
    Strikers. We did not propose any changes in 7 CFR 273.1(d), Head of 
Household, and (f), Authorized Representative, because we believe the 
current regulations are appropriate. We have redesignated the 
requirements in current regulations at 7 CFR 273.1(g) for determining 
the eligibility and benefits of households containing members on strike 
as paragraph (e), with minor editorial changes for clarity. We received 
no comments on our decisions with regard to these provisions.

Application Processing--7 CFR 273.2

    Expedited Service: Current regulations at 7 CFR 273.2(i) provide 
for expedited service to certain categories of households with very low 
income and resources, including households in which all members are 
homeless. Prior to PRWORA, section 11(e)(9) of the Act (7 U.S.C. 
2020(e)(9)) required that benefits be provided not later than five 
calendar days following a household's date of application for all 
eligible households that were also eligible for expedited service. 
Section 838 of PRWORA amended section 11(e)(9) of the Act by increasing 
the time that States may take to provide expedited service from five to 
seven calendar days, and eliminating households consisting entirely of 
homeless people from those categories of households entitled to receive 
expedited service. We received no comments on the proposal to implement 
these changes, as outlined in the proposed rule.
    Accordingly, consistent with our proposals, this rule amends 7 CFR 
273.2(i)(3)(i) by striking ``fifth'' calendar day and inserting 
``seventh''. This rule also amends 7 CFR 273.2(i)(3)(ii) by striking 
``5 calendar days'' and inserting ``7 calendar days''. In addition, the 
rule removes 7 CFR 273.2(i)(1)(iii) which provides that households in 
which all

[[Page 64584]]

members are homeless individuals are entitled to expedited service and 
redesignates (i)(1)(iv) as (i)(1)(iii). Homeless individuals may 
continue to qualify for expedited service under the financial criteria 
set forth in 7 CFR 273.2(i).

Resource Eligibility Standards--7 CFR 273.8

    Fair Market Value: Section 810 of PRWORA amended section 5(g) of 
the Act (7 U.S.C. 2014(g)) to provide that any licensed vehicle that is 
not subject to other exclusions and is used for household 
transportation or to obtain or continue employment, to the extent that 
the fair market value of the vehicle exceeds $4,600 through September 
30, 1996, and $4,650 beginning October 1, 1996, must be included in 
financial resources. Section 810 also freezes the fair market value 
exclusion limit used in determining the countable value of the included 
vehicle at $4,650. Accordingly, this rule amends 7 CFR 273.8 to include 
the new resource exclusion level, which was implemented October 1, 
1996.
    We proposed to modify the definition of a vehicle that can be 
excluded from a household's assets because it is used for income-
producing purposes in the current rules at 7 CFR 273.8(h)(1)(i) 
(redesignated 273.8(e)(3)(i)(A)). Examples of such vehicles would be a 
car used for a job as a delivery person, a motor vehicle used by a 
courier, a car used by a household member to call on clients or 
customers, even though the vehicle is not used for long-distance 
travel, or any vehicle used to perform a job that was advertised as 
requiring a personally-owned motor vehicle. The current rule requires 
that the vehicle be used primarily for producing income. We proposed to 
remove the word ``primarily'' to ensure that State agencies would not 
have to verify the relative amount of mileage traveled for income-
producing purposes. Two State agencies commented that our proposal did 
not go far enough. They proposed that we exclude any vehicle used to go 
to work. Section 5(g)(1)(C) of the Act does not allow us to change the 
rules to that extent. Specifically, it excludes from a household's 
financial resources a vehicle ``used to produce earned income.'' This 
language allows us to make the change we proposed, since a vehicle used 
for deliveries is clearly being used to produce earned income. We do 
not believe that a reasonable view of the clear language of the Act 
allows us to exclude all vehicles used to commute to work. Accordingly, 
this rule amends 7 CFR 273.8 to remove the requirement that a vehicle 
used for income-producing purposes be used primarily for those purposes 
in order to be excluded from a household's assets.
    A State agency commented that the language on vehicles necessary to 
transport a physically disabled household member at 
Sec. 273.8(e)(3)(i)(E) seems somewhat contradictory because it talks 
about special vehicles and specially equipped vehicles being considered 
necessary, but then goes on to state that the vehicle need not have 
special equipment. We agree. We have removed the examples and have 
simplified the provision, relying on the basic statement that a vehicle 
necessary to transport a physically disabled household member is 
excluded.

Reorganization of 7 CFR 273.8

    In the proposed rule, we took the opportunity to reorganize 7 CFR 
273.8 and to remove redundant or unnecessary language. Section 5(g)(2) 
of the Act requires that the Secretary prescribe inclusions in, and 
exclusions from, financial resources following the regulations in force 
as of June 1, 1982. The law provides an exception for the regulations 
governing vehicles and inaccessible resources. All other resource 
inclusion and exclusion provisions described in the regulations as of 
June 1, 1982, became law by reference and can only be changed through 
legislative action. Nonetheless, there were some provisions we were 
able to change and some areas where we could remove redundant or 
unnecessary language. This rule revises 7 CFR 273.8(e), (g), (h), and 
(i), and removes (j).
    We proposed to remove all the provisions from paragraph (h) and 
transfer some of them to (e) and the others to (g). We have taken the 
list of vehicles excluded from resource consideration currently 
contained in paragraphs (h)(1)(i)-(v) and (h)(2) and incorporated it 
into 7 CFR 273.8(e)(3). We rewrote the remaining provisions of 
paragraphs (h)(3), (h)(4) and (h)(5) concerning the treatment of non-
excluded vehicles and combined them with the provisions in paragraph 
(g) to improve readability. As a result of transferring the text of 
paragraph (h), that paragraph no longer exists, and we have 
redesignated paragraph (i) as paragraph (h). We have made a conforming 
amendment to paragraphs (e)(16) and (e)(18) to note the relocation of 
the vehicle exclusion provisions. We also, in the proposed rule, 
removed the current 7 CFR 273.8(j), which provides that the resources 
of certain non-household members must be treated in accordance with 7 
CFR 273.11. We believed the reference was unnecessary. After reviewing 
comments, and reconsidering the rule, we have decided to retain the 
reference as a useful guide to policy.
    In keeping with the principles of the President's Regulatory Reform 
Initiative of increasing State flexibility, this rule removes the 
proscriptive regulations in paragraph (g) for determining the fair 
market value of a vehicle and allows State agencies to establish their 
own methodologies. However, to ensure client protection, we have 
decided to retain the prohibition against increasing the basic value of 
a vehicle because of low mileage, optional equipment, or special 
apparatus for the handicapped, as State variations may affect 
eligibility and costs.
    We proposed also to revise paragraph (e)(11), which excludes from 
countable resources any resource that is specifically excluded by any 
other Federal statute and lists such excluded resources. We proposed to 
remove the specific list of resources excluded by other Federal laws. 
We periodically provide State agencies with a list of such excluded 
resources through agency memoranda because the list changes frequently 
and quickly becomes outdated. Doing this through the regulatory 
amendment process often results in incomplete or obsolete regulations, 
thereby causing confusion. We believe it is sufficient to have the 
regulation simply provide an exclusion for any resource specifically 
excluded by another Federal statute and to continue to notify State 
agencies through agency memoranda when such laws are enacted. We 
received no comments on this provision (other than one urging us to 
inform State agencies promptly in writing of all exclusions, which we 
currently do). Therefore, we are amending the rule accordingly.

Income and Deductions--7 CFR 273.9

    Annual adjustments of gross and net income standards, and maximum 
allotments. FNS currently publishes Notices in the Federal Register 
every year to announce the amounts of the monthly gross and net income 
eligibility standards, and of the maximum allotments, for the 
contiguous 48 States and the District of Columbia, Alaska, Hawaii, Guam 
and the U.S. Virgin Islands. This process is cumbersome. The regulatory 
clearance process precludes publishing the numbers in time for State 
agencies to use them. Therefore, we send the numbers to the State 
agencies by memorandum--customarily in August, so the State agencies 
can program their computers in time for the new numbers to take effect 
on the October 1 deadline each year. We have started posting the new 
numbers on the FNS web site shortly after we

[[Page 64585]]

officially notify State agencies of them. This accomplishes the same 
thing as publishing Notices in the Federal Register. And it does it on 
time, and more economically. Therefore, we will no longer publish these 
numbers in Federal Register Notices. You can find them on our web site 
at www.fns.usda.gov/fsp. We are making a technical change to delete 
references to publication of these numbers in Federal Register Notices 
from our rules.
    Income exclusions: Current regulations at 7 CFR 273.9(c)(1)(i) 
prescribe whether to exclude from income a number of kinds of public 
assistance (PA) vendor payments (payments made by a third party on 
behalf of a household). A commenter pointed out that a number of State 
agencies are now using Temporary Assistance for Needy Families (TANF) 
funds to supplement housing assistance from the Department of Housing 
and Urban Development (HUD), and are channeling those payments through 
State or local housing authorities. Section 5(k)(2)(D) of the Act, 7 
U.S.C. 2014(k)(2)(D), requires us to exclude such payments from income. 
The commenter inferred that we had overlooked this requirement of the 
Act in a previous revision of the rules. Since the Act requires us to 
exclude this new category of TANF-funded vendor payments from income, 
we are making a technical correction to the rules at 7 CFR 
273.9(c)(1)(i) to make this requirement clear. (We received the comment 
after the end of the comment period, but we believe it is important to 
correct the rule in any case.)
    Standard Deduction: Current regulations at 7 CFR 273.9(d)(8) 
provide that, effective October 1, 1987, and each October 1 thereafter, 
the standard deduction from gross income must be adjusted to reflect 
changes in the CPI-U for items other than food for the twelve months 
ending the preceding June 30. Section 809 of PRWORA amended section 
5(e) of the Act to provide that the Secretary must allow and maintain 
the standard deduction for each household in the 48 contiguous States 
and the District of Columbia, Alaska, Hawaii, Guam, and the Virgin 
Islands of the United States of $134, $229, $189, $269, and $118, 
respectively. In effect, PRWORA eliminated the annual adjustment to the 
various standard deductions. This rule amends the regulations at 7 CFR 
273.9(d)(1) accordingly.
    Excess Shelter Expense Deduction: Section 809 of PRWORA amended 
section 5(e) of the Act to change the excess shelter limit. Section 
5(e), 7 U.S.C. 2014(e), now provides that a household is entitled to an 
excess shelter expense deduction to the extent that the monthly amount 
expended by a household for shelter exceeds an amount equal to 50 
percent of monthly household income after all other applicable 
deductions have been allowed. In the case of a household that does not 
contain an elderly or disabled individual, in the 48 contiguous States 
and the District of Columbia, Alaska, Hawaii, Guam and the Virgin 
Islands of the United States, the excess shelter expense deduction must 
not exceed:
    (i) For the period beginning on the date of enactment of the law 
and ending on December 31, 1996, $247, $429, $353, $300, and $182 per 
month, respectively;
    (ii) For the period beginning on January 1, 1997, and ending on 
September 30, 1998, $250, $434, $357, $304, and $184 per month, 
respectively;
    (iii) For fiscal years 1999 and 2000, $275, $478, $393, $334, and 
$203 per month, respectively; and
    (iv) For fiscal year 2001 and each subsequent fiscal year, $300, 
$521, $429, $364, and $221 per month, respectively.
    This final rule makes corresponding changes to the regulations at 7 
CFR 273.9(d)(8).

Determining Household Eligibility and Benefit Levels--7 CFR 273.10

    Maximum Allotments: Section 804 of PRWORA amended section 3(o) of 
the Act (7 U.S.C. 2012(o)) by providing that on October 1, 1996, and 
each October 1 thereafter, the Department must adjust the cost of the 
maximum allotment to reflect the cost of the Thrifty Food Plan in the 
preceding June, and round the result to the nearest lower dollar 
increment for each household size, except that on October 1, 1996, the 
Secretary was not allowed to reduce the cost of the maximum allotment 
in effect on September 30, 1996.
    Accordingly, this final rule amends 7 CFR 273.10(e)(4)(ii) to 
provide that effective October 1, 1996, the maximum food stamp 
allotments must be based on 100% of the cost of the TFP, as defined in 
section 271.2, for the preceding June, rounded to the nearest lower 
dollar increment, except that on October 1, 1996, the allotments may 
not fall below those in effect on September 30, 1996.
    In addition, we are removing 7 CFR 273.10(e)(4)(ii)(A) through (F), 
as these paragraphs, which provide for the adjustment of the TFP for 
the years 1983 through 1995, are outdated.

Conforming Amendments

    Aid to Families with Dependent Children: Section 101 of PRWORA 
block granted this program to the States and renamed it the Temporary 
Assistance for Needy Families (TANF) program. Therefore, the terms 
``Aid to Families With Dependent Children'' and its acronym, ``AFDC'', 
are obsolete. Section 109 of PRWORA made conforming amendments to the 
Act by replacing the obsolete terms with a reference to assistance 
under a State program funded under part A of title IV of the Social 
Security Act, the provision that authorizes TANF.
    Accordingly, this rule amends Subchapter C by replacing the words 
``Aid to Families with Dependent Children'' with ``Temporary Assistance 
for Needy Families'', by replacing ``AFDC'' with ``TANF'', and by 
replacing the words ``Aid to Families with Dependent Children (AFDC)'' 
with ``Temporary Assistance for Needy Families (TANF)''.
    Child support payments: As required by section 5 of the Act prior 
to PRWORA, the current regulations at 7 CFR 273.9(c)(12) provide that 
the State agency has the option to exclude from unearned income up to 
$50 monthly of title IV-D child support payments in cases where such 
payments are received by the households from the title IV-D support 
agency responsible for collecting such child support payments on behalf 
of AFDC recipients. Section 109 of PRWORA amended section 5 of the Act 
by removing this exclusion. This rule removes 7 CFR 273.9(c)(12) and 
renumbers (c)(13) through (c)(17) accordingly.
    As required by section 5 of the Act prior to PRWORA, current 
regulations at 7 CFR 276.2(e)(1) provide that the State agency must pay 
FNS for the increased dollar value of coupon allotments resulting from 
providing households with an income exclusion for child support 
payments as described in Sec. 273.9(c)(12). Section 109 of PRWORA 
amended section 5 of the Act by removing the payback. Accordingly, this 
rule removes 7 CFR 276.2(e) in its entirety and removes the last two 
sentences of paragraph (2).

Implementation

    As stated in the preamble to the proposed rules, we instructed 
State agencies through agency directive to implement the provisions of 
PRWORA without waiting for formal regulations. The amendments to the 
definition of ``Homeless individual'' in Sec. 271.2, and the amendments 
to Sec. 273.1(b)(1)(ii) and Sec. 273.2(i)(3)(i) and (i)(3)(ii) were to 
be implemented August 22, 1996. The amendments to Sec. 273.8(f)(1) and 
Sec. 273.10(e)(4)(ii) were to be implemented October 1, 1996. The

[[Page 64586]]

amendment to Sec. 273.9(d)(8) was to be implemented January 1, 1997. 
The remaining amendments in this rule, with two exceptions, must be 
implemented no later than January 1, 2001. The amendments to 
Sec. 273.1(b)(1)(iii), and Sec. 273.8(e)(3)(i)(A), must be implemented 
no later than March 1, 2001. After implementation, State agencies must 
adjust the cases of ongoing households at the next recertification, at 
household request, or when the case is next reviewed, whichever comes 
first. If implementation of the above Act or this rule is delayed, 
benefits must be restored, as appropriate, in accordance with the Food 
Stamp Act.
    Quality Control. Variances resulting from implementation of the 
provisions of this final rule will be excluded from error analysis for 
120 days from the required implementation date. State agencies that 
implement the provisions before the required implementation date must 
notify the appropriate FNS regional office before implementing that 
they wish the variance exclusion period to begin with the actual 
implementation, as provided in 7 CFR 275.12(d)(2)(vii)(A). The 
exclusionary period will begin with the required implementation date, 
if the State agency does not notify the appropriate regional office.

List of Subjects

7 CFR Part 271

    Administrative practice and procedure, Food stamps, Grant 
programs--social programs.

7 CFR Part 273

    Administrative practice and procedures, Aliens, Claims, Food 
stamps, Fraud, Grant programs--social programs, Penalties, Reporting 
and record keeping requirements, Social Security, Students.

7 CFR Part 276

    Administrative practice and procedure, Food stamps, Reporting and 
record keeping requirements.


    Accordingly, 7 CFR chapter II, subchapter C, and parts 271, 273, 
and 276 are amended as follows:

SUBCHAPTER C--FOOD STAMP AND FOOD DISTRIBUTION PROGRAM

    1. In Subchapter C:
    a. Remove the words ``Aid to Families with Dependent Children'' 
wherever they appear and add the words ``Temporary Assistance for Needy 
Families'' in their place.
    b. Remove the word ``AFDC'' wherever it appears and add ``TANF'' in 
its place.
    c. Remove the words ``Aid to Families with Dependent Children 
(AFDC)'' wherever they appear, and add the words ``Temporary Assistance 
for Needy Families (TANF)'' in their place.

    2. The authority citation for parts 271, 273, and 276 continues to 
read as follows:

    Authority: 7 U.S.C. 2011-2036.

PART 271--GENERAL INFORMATION AND DEFINITIONS


Sec. 271.2  [Amended]

    3. In Sec. 271.2:
    a. Amend paragraph (3) of the definition of ``Homeless individual'' 
by adding the words ``for not more than 90 days'' after the word 
``accommodation''.
    b. Amend the definition of ``Minimum benefit'' by removing all text 
after the word ``benefit'' in the second sentence and adding in its 
place ``shall be $10.''
    c. Remove the definition of ``Spouse''.

PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES

    4. In Sec. 272.1, add paragraph (g)(157) to read as follows:


Sec. 272.1  General terms and conditions.

* * * * *
    (g) Implementation. * * *
    (157) Amendment No. 381. The provisions of Amendment 381 are 
implemented as follows:
    (i) The definition of ``Homeless individual'' in Sec. 271.2, and 
the amendments to Sec. 273.1(b)(1)(ii), Sec. 273.2(i)(3)(i) and 
(i)(3)(ii) were to be implemented August 22, 1996;
    (ii) The amendments to Sec. 273.8(f)(1) and Sec. 273.10(e)(4)(ii) 
were to be implemented October 1, 1996;
    (iii) The amendment to Sec. 273.9(d)(8) was to be implemented 
January 1, 1997;
    (iv) The amendments to Sec. 273.1(b)(1)(iii) and 
Sec. 273.8(e)(3)(i)(A) must be implemented no later than March 1, 2001; 
and
    (v) All remaining amendments must be implemented no later than 
January 1, 2001.
* * * * *

PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS

    5. In Sec. 273.1, remove paragraph (g), and revise paragraphs (a), 
(b), (c) and (e) to read as follows:


Sec. 273.1  Household concept.

    (a) General household definition. A household is composed of one of 
the following individuals or groups of individuals, unless otherwise 
specified in paragraph (b) of this section:
    (1) An individual living alone;
    (2) An individual living with others, but customarily purchasing 
food and preparing meals for home consumption separate and apart from 
others; or
    (3) A group of individuals who live together and customarily 
purchase food and prepare meals together for home consumption.
    (b) Special household requirements.--(1) Required household 
combinations. The following individuals who live with others must be 
considered as customarily purchasing food and preparing meals with the 
others, even if they do not do so, and thus must be included in the 
same household, unless otherwise specified.
    (i) Spouses;
    (ii) A person under 22 years of age who is living with his or her 
natural or adoptive parent(s) or step-parent(s); and
    (iii) A child (other than a foster child) under 18 years of age who 
lives with and is under the parental control of a household member 
other than his or her parent. A child must be considered to be under 
parental control for purposes of this provision if he or she is 
financially or otherwise dependent on a member of the household, unless 
State law defines such a person as an adult.
    (2) Elderly and disabled persons. Notwithstanding the provisions of 
paragraph (a) of this section, an otherwise eligible member of a 
household who is 60 years of age or older and is unable to purchase and 
prepare meals because he or she suffers from a disability considered 
permanent under the Social Security Act or a non disease-related, 
severe, permanent disability may be considered, together with his or 
her spouse (if living there), a separate household from the others with 
whom the individual lives. Separate household status under this 
provision must not be granted when the income of the others with whom 
the elderly disabled individual resides (excluding the income of the 
elderly and disabled individual and his or her spouse) exceeds 165 
percent of the poverty line.
    (3) Boarders. (i) Residents of a commercial boarding house, 
regardless of the number of residents, are not eligible to participate 
in the Program. A commercial boarding house is an establishment 
licensed to offer meals and lodging for compensation. It does not 
include any of the entities listed in paragraph (b)(7)(vii) of this 
section. In project areas without licensing requirements, a commercial 
boarding house is a commercial establishment that offers meals and 
lodging for compensation with the intent of making a profit.

[[Page 64587]]

    (ii) All other individuals or groups of individuals paying a 
reasonable amount for meals or meals and lodging must be considered 
boarders and are not eligible to participate in the Program 
independently of the household providing the board. Such individuals or 
groups of individuals may participate, along with a spouse or children 
living with them, as members of the household providing the boarder 
services, only at the request of the household providing the boarder 
services. An individual paying less than a reasonable amount for board 
must not be considered a boarder but must be considered, along with a 
spouse or children living with him or her, as a member of the household 
providing the board.
    (A) For individuals whose board arrangement is for more than two 
meals per day, ``reasonable compensation'' must be an amount that 
equals or exceeds the maximum food stamp allotment for the appropriate 
size of the boarder household.
    (B) For individuals whose board arrangement is for two meals or 
less per day, ``reasonable compensation'' must be an amount that equals 
or exceeds two-thirds of the maximum food stamp allotment for the 
appropriate size of the boarder household.
    (iii) Boarders must not be considered to be residents of an 
institution as outlined in paragraph (b)(7)(vii) of this section.
    (4) Foster care individuals. Individuals placed in the home of 
relatives or other individuals or families by a Federal, State, or 
local governmental foster care program must be considered to be 
boarders. They cannot participate in the Program independently of the 
household providing the foster care services. Such foster care 
individuals may participate, along with a spouse or children living 
with them, as members of the household providing the foster care 
services, only at the request of the household providing the foster 
care.
    (5) Roomers. Individuals to whom a household furnishes lodging for 
compensation, but not meals, may participate as separate households. 
Persons described in paragraph (b)(1) of this section must not be 
considered roomers.
    (6) Live-in attendants. A live-in attendant may participate as a 
separate household. Persons described in paragraph (b)(1) of this 
section must not be considered live-in attendants.
    (7) Ineligible household members. The following persons are not 
eligible to participate as separate households or as a member of any 
household:
    (i) Ineligible aliens and students as specified in Sec. 273.4 and 
Sec. 273.5, respectively;
    (ii) SSI recipients in ``cash-out'' States as specified in 
Sec. 273.20;
    (iii) Individuals disqualified for noncompliance with the work 
requirements of Sec. 273.7;
    (iv) Individuals against whom a sanction was imposed for failure to 
comply with a workfare requirement as specified in Sec. 273.22;
    (v) Individuals disqualified for failure to provide an SSN as 
specified in Sec. 273.6;
    (vi) Individuals disqualified for an intentional Program violation 
as specified in Sec. 273.16; and
    (vii) Residents of an institution, with some exceptions. 
Individuals must be considered residents of an institution when the 
institution provides them with the majority of their meals (over 50 
percent of three meals daily) as part of the institution's normal 
services. Exceptions to this requirement include only the individuals 
listed in paragraphs (b)(7)(vii)(A) through (b)(7)(vii)(E) of this 
section. The individuals listed in paragraphs (b)(7)(vii)(A) through 
(b)(7)(vii)(E) can participate in the Program and must be treated as 
separate households from the others with whom they reside, subject to 
the mandatory household combination requirements of paragraph (b)(1) of 
this section, unless otherwise stated:
    (A) Individuals who are residents of federally subsidized housing 
for the elderly;
    (B) Individuals who are narcotic addicts or alcoholics and reside 
at a facility or treatment center for the purpose of regular 
participation in a drug or alcohol treatment and rehabilitation 
program. This includes the children but not the spouses of such persons 
who live with them at the treatment center or facility;
    (C) Individuals who are disabled or blind and are residents of 
group living arrangements;
    (D) Individual women or women with their children who are 
temporarily residing in a shelter for battered women and children; and
    (E) Individuals who are residents of public or private nonprofit 
shelters for homeless persons.
    (c) Unregulated situations. For situations that are not clearly 
addressed by the provisions of paragraphs (a) and (b) of this section, 
the State agency may apply its own policy for determining when an 
individual is a separate household or a member of another household if 
the policy is applied fairly, equitably and consistently throughout the 
State.
* * * * *
    (e) Strikers. Households with a striking member are not eligible to 
participate in the Program, unless the household was eligible for 
benefits the day before the strike and is otherwise eligible at the 
time of application. A striker must be anyone involved in a strike or 
concerted stoppage of work by employees (including a stoppage by reason 
of the expiration of a collective-bargaining agreement) and any 
concerted slowdown or other concerted interruption of operations by 
employees. Any employee affected by a lockout, however, must not be 
deemed to be a striker. Further, an individual who goes on strike but 
is exempt from work registration under Sec. 273.7(b) the day before the 
strike, other than those exempt solely on the grounds that they are 
employed, must not be deemed to be a striker. Also, persons such as 
truck drivers who cannot do their jobs because the strike has left them 
with nothing to deliver, and employees who are not part of the 
bargaining unit and do not want to cross the picket line for fear of 
personal injury or death, must not be deemed to be strikers.
    (1) Pre-strike eligibility must be determined by considering the 
day prior to the strike as the day of application and assuming the 
strike did not occur.
    (2) Eligibility at the time of application must be determined by 
comparing the striking member's income before the strike to the 
striker's current income and adding the higher of the two to the 
current income of non-striking members during the month of application. 
If the household is eligible, the higher income figure must also be 
used in determining the household's benefits.
* * * * *


Sec. 273.2  [Amended]

    6. In Sec. 273.2:
    a. Remove paragraph (i)(1)(iii).
    b. Redesignate paragraph (i)(1) (iv) as paragraph (i)(1)(iii).
    c. Amend paragraph (i)(3)(i) by removing the word ``fifth'' 
wherever it appears and adding the word ``seventh'' in its place.
    d. Amend paragraph (i)(3)(ii) by removing the words ``5 calendar 
days'' and adding the words ``7 calendar days'' in its place.


Sec. 273.8  [Amended]

    7. In Sec. 273.8:
    a. Amend paragraph (c)(2) by removing the regulatory reference to 
``paragraph (h)'' and adding in its place a regulatory reference to 
``paragraph (f)''.

[[Page 64588]]

    b. Revise paragraph (e)(3).
    c. Amend paragraph (e)(11) by removing the second sentence of the 
introductory text and by removing paragraphs (e)(11)(i) through 
(e)(11)(ix).
    d. Amend paragraph (e)(16) by removing the regulatory reference to 
``paragraphs (h)(1)(i), (h)(1)(ii) or (h)(1)(v)'' and adding in its 
place the regulatory reference to ``paragraphs (e)(3)(i)(A), 
(e)(3)(i)(B) or (e)(3)(i)(C)'', respectively.
    e. Amend paragraph (e)(18) by removing the regulatory reference to 
``paragraph (h)'' and adding in its place a regulatory reference to 
``paragraph (f)''.
    f. Redesignate paragraphs (g) and (f) as paragraphs (f) and (g), 
respectively, and revise newly redesignated paragraph (f).
    g. Remove paragraph (h) and redesignate paragraphs (i) and (j) as 
paragraphs (h) and (i) and revise newly redesignated paragraph (i).
    The revisions read as follows:


Sec. 273.8  Resource eligibility standards.

* * * * *
    (e) Exclusions from resources. * * *
    (3)(i) Licensed vehicles that meet the following conditions:
    (A) Used for income-producing purposes such as, but not limited to, 
a taxi, truck, or fishing boat, or a vehicle used for deliveries, to 
call on clients or customers, or required by the terms of employment. 
Licensed vehicles that have previously been used by a self-employed 
household member engaged in farming but are no longer used in farming 
because the household member has terminated his/her self-employment 
from farming must continue to be excluded as a resource for one year 
from the date the household member terminated his/her self-employment 
farming;
    (B) Annually producing income consistent with its fair market 
value, even if used only on a seasonal basis;
    (C) Necessary for long-distance travel, other than daily commuting, 
that is essential to the employment of a household member (or 
ineligible alien or disqualified person whose resources are being 
considered available to the household)--for example, the vehicle of a 
traveling sales person or a migrant farm worker following the work 
stream;
    (D) Used as the household's home and, therefore, excluded under 
paragraph (e)(1) of this section;
    (E) Necessary to transport a physically disabled household member 
(or physically disabled ineligible alien or physically disabled 
disqualified person whose resources are being considered available to 
the household) regardless of the purpose of such transportation 
(limited to one vehicle per physically disabled household member). The 
vehicle need not have special equipment or be used primarily by or for 
the transportation of the physically disabled household member; or
    (F) Necessary to carry fuel for heating or water for home use when 
the transported fuel or water is anticipated to be the primary source 
of fuel or water for the household during the certification period. 
Households must receive this resource exclusion without having to meet 
any additional tests concerning the nature, capabilities, or other uses 
of the vehicle. Households must not be required to furnish 
documentation, as mandated by Sec. 273.2(f)(4), unless the exclusion of 
the vehicle is questionable. If the basis for exclusion of the vehicle 
is questionable, the State agency may require documentation from the 
household, in accordance with Sec. 273.2(f)(4).
    (ii) On those Indian reservations that do not require vehicles 
driven by tribal members to be licensed, such vehicles must be treated 
as licensed vehicles for the purpose of this exclusion.
    (iii) The exclusions in paragraphs (e)(3)(i)(A) through 
(e)(3)(i)(C) of this section will apply when the vehicle is not in use 
because of temporary unemployment, such as when a taxi driver is ill 
and cannot work, or when a fishing boat is frozen in and cannot be 
used.
* * * * *
    (f) Determining the value of non-excluded vehicles. (1) The State 
agency must:
    (i) Individually evaluate the fair market value of each licensed 
vehicle that is not excluded under paragraph (e)(3) of this section;
    (ii) Count in full toward the household's resource level, 
regardless of any encumbrances on the vehicle, that portion of the fair 
market value that exceeds $4,650 beginning October 1, 1996;
    (iii) Evaluate such licensed vehicles as well as all unlicensed 
vehicles for their equity value (fair market value less encumbrances), 
unless specifically exempt from the equity value test; and
    (iv) Count as a resource only the greater of the two amounts if the 
vehicle has a countable fair market value of more than $4,650 after 
October 1, 1996, and also has a countable equity value.
    (2) Only the following vehicles are exempt from the equity value 
test outlined in paragraph (f)(1)(iii) of this section:
    (i) Vehicles excluded under paragraph (e)(3)(i) of this section;
    (ii) One licensed vehicle per household; and
    (iii) Any other vehicle used to transport household members (or an 
ineligible alien or disqualified household member whose resources are 
considered available to the household) to and from employment 
(including times during temporary periods of unemployment), or to and 
from training or education that is preparatory to employment, or to 
seek employment in compliance with the employment and training criteria 
specified in Sec. 273.7.
    (3) State agencies will be responsible for establishing 
methodologies for determining the fair market value of vehicles. In 
establishing such methodologies, the State agency must not increase the 
basic value of a vehicle by adding the value of low mileage or other 
factors such as optional equipment or special apparatus for the 
handicapped. Any household that claims that the State agency's 
determination of the value of its vehicle(s) is not accurate must be 
given the opportunity to acquire verification of the true value of the 
vehicle from a reliable source.
* * * * *
    (i) Resources of non-household members.
    (1) The resources of non-household members, as defined in 
Sec. 273.1(b)(7)(i) and (ii), must be handled as outlined in 
Sec. 273.11(d).
    (2) The resources of non-household members, as defined in 
Sec. 273.1(b)(7)(iii) through (vi), must be handled as outlined in 
Sec. 273.11(c) and (d), as appropriate.

    8. In Sec. 273.9:
    a. Revise paragraph (a)(4).
    b. Redesignate paragraph (c)(1)(i)(F) as paragraph (c)(1)(i)(G), 
and add a new paragraph (c)(1)(i)(F).
    c. Remove paragraph (c)(12) and redesignate paragraphs (c)(13), 
(c)(14), (c)(15), (c)(16) and (c)(17) as paragraphs (c)(12), (c)(13), 
(c)(14), (c)(15) and (c)(16) respectively.
    d. Revise paragraph (d)(1), remove paragraph (d)(8), and 
redesignate paragraph (d)(9) as paragraph (d)(8).
    e. Revise newly redesignated paragraph (d)(8).
    The revisions and addition read as follows:


Sec. 273.9  Income and deductions.

    (a) * * *
    (4) The monthly gross and net income eligibility standards for all 
areas will be prescribed in tables posted on the FNS web site, at 
www.fns.usda.gov/fsp.
* * * * *
    (c) * * *
    (1) * * *
    (i) * * *

[[Page 64589]]

    (F) Housing assistance payments made through a State or local 
housing authority;
* * * * *
    (d) * * *
    (1) Standard deduction. Effective October 1, 1996, for each 
household in the 48 contiguous States and the District of Columbia, 
Alaska, Hawaii, Guam and the Virgin Islands of the United States, the 
standard deduction must be $134, $229, $189, $269, and $118, 
respectively.
* * * * *
    (8) Adjustment of shelter deduction. In the case of a household 
that does not contain an elderly or disabled individual, in the 48 
contiguous States and the District of Columbia, Alaska, Hawaii, Guam 
and the Virgin Islands of the United States, the excess shelter expense 
deduction must not exceed:
    (i) For the period beginning August 22, 1996, and ending on 
December 31, 1996, $247, $429, $353, $300, and $182 per month, 
respectively;
    (ii) For the period beginning on January 1, 1997, and ending on 
September 30, 1998, $250, $434, $357, $304, and $184 per month, 
respectively;
    (iii) For the period beginning on October 1, 1998, and ending on 
September 30, 2000, $275, $478, $393, $334, and $203 per month, 
respectively; and
    (iv) For the period beginning on October 1, 2000, and thereafter, 
$300, $521, $429, $364, and $221 per month, respectively.
* * * * *

    9. In Sec. 273.10:
    a. Amend the last sentence of paragraph (e)(4)(i) by removing the 
words ``a General Notice published in the Federal Register'' and adding 
in their place the words ``a table posted on the FNS web site, at 
www.fns.usda.gov/fsp.''
    b. Revise paragraph (e)(4)(ii) to read as follows:


Sec. 273.10  Determining household eligibility and benefit levels.

* * * * *
    (e) * * *
    (4) * * *
    (ii) Adjustment. Effective October 1, 1996, the maximum food stamp 
allotments must be based on 100% of the cost of the TFP as defined in 
Sec. 271.2 of this chapter for the preceding June, rounded to the 
nearest lower dollar increment, except that on October 1, 1996, the 
allotments may not fall below those in effect on September 30, 1996.
* * * * *


Sec. 276.2  [Amended]

    10. Remove the last two sentences of paragraph (a) and paragraph 
(e) in its entirety in Sec. 276.2.

    Dated: October 13, 2000.
Shirley R. Watkins,
Under Secretary, Food, Nutrition, and Consumer Services.
[FR Doc. 00-27483 Filed 10-27-00; 8:45 am]
BILLING CODE 3410-30-U


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