Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER. 

Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 

303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email 

corrections@akcourts.us. 

THE SUPREME COURT OF THE STATE OF ALASKA 

STATE OF ALASKA, 

DEPARTMENT OF HEALTH AND 

SOCIAL SERVICES, DIVISION OF 

PUBLIC ASSISTANCE, 

Petitioner, 

v. 

LESTER GROSS, 

Respondent. 

) 

) Supreme Court No. S-15339 

Superior Court No. 3AN-12-09838 CI 

O P I N I O N 

No. 7001 – April 24, 2015 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

Petition for Review from the Superior Court of the State of 

Alaska, Third Judicial District, Anchorage, Erin B. Marston, 

Judge. 

Appearances: Kathryn R. Vogel, Assistant Attorney General, 

Anchorage, and Michael C. Geraghty, Attorney General, 

Juneau, for Petitioner. Mark Regan, Disability Law Center 

of Alaska, Anchorage, for Respondent. 

Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and 

Bolger, Justices. 

MAASSEN, Justice. 

I. INTRODUCTION 

An applicant for federal disability benefits applied for state benefits that are 

intended to provide basic assistance while the federal application is pending. The 
 

 

 

 

 

 

 

 

 

Division of Public Assistance — the division of the Alaska Department of Health and 

Social Services that administers the state program1 — denied these interim benefits, 

relying on a subset of the criteria that the Social Security Administration uses to 

determine eligibility for federal benefits. The superior court reversed this decision, 

holding that Alaska law required the Department to apply the same federal substantive 

criteria and procedural requirements to its determination of eligibility for state interim 

benefits. The Department petitioned for review, and we granted the petition. 

We conclude that, while state law does not require the Department to track 

the federal analysis exactly when it assesses eligibility for state interim benefits, the 

Department’s application of the law erroneously excludes a category of applicants who 

will be found to be disabled for purposes of federal benefits and who therefore should 

be entitled to interim assistance. We therefore affirm the superior court’s decision in 

part, reverse it in part, and remand for further proceedings. 

II. FACTS AND PROCEEDINGS 

A. Facts 

Certain persons who are disabled and unable to work are entitled to federal 

Supplemental Security Income (SSI) benefits administered by the United States Social 

Security Administration. 2 In determining whether an applicant is “disabled” and 

therefore entitled to SSI benefits, the Social Security Administration uses a five-step 

1 See 7 Alaska Administrative Code (AAC) 40.040 (2015) (“Assistance 

under this chapter will be granted only upon application to the division.”); 7 AAC 

40.900(4) (2015) (“In this chapter, . . . ‘division’ means the division of public assistance 

of the Department of Health and Social Services.”). 

2 See 42 U.S.C. § 1381 (2012); 20 C.F.R. § 416.110 (2014). 

- 2 - 7001
 
 

 

 

 

 

process outlined in federal regulations. 3 Steps one and two are satisfied if the 

Administration finds first that the applicant is not currently engaged in “substantial 

4 gainful activity” and second that the applicant has a “determinable physical or mental

impairment” lasting at least one year or likely to result in death, significantly limiting the 

applicant’s “physical or mental ability to do basic work activities.”5 If these first two 

steps are satisfied, an individual may qualify for SSI benefits at step three, where the 

Administration considers whether the medical severity of the applicant’s impairment 

“meets or equals” a disability listed in federal regulations.6 

Individuals who satisfy the first two steps but do not qualify for SSI 

benefits at step three may nonetheless qualify through steps four and five. At step four, 

the Social Security Administration considers whether the applicant, despite his or her 

impairment, can perform work he or she has done in the past; if so, the applicant is not 

disabled and not entitled to SSI benefits.7 If the applicant cannot perform past work, 

however, the analysis proceeds to step five. 

At step five the Social Security Administration considers the applicant’s 

8 ability to do other work in the national economy; if the applicant can perform other

work, he or she is not disabled and not entitled to SSI benefits. The burden shifts at this 

3 See 20 C.F.R. § 416.920(a)(4) (describing five-step process in general); 

FRANK BLOCH, BLOCH ON SOCIAL SECURITY § 3:7 (2015 ed.). 

4 20 C.F.R. §§ 416.920(a)(4)(ii), 416.920(b). 

5 Id. §§ 416.920(c), 416.909. 

6 Id. § 416.920(d). The qualifying impairments are listed at id. § 404, subpart 

P, appendix 1. Id. § 416.920(a)(4)(iii). 

7 Id. §§ 416.920(f), 416.920(h), 416.960(b). 

8 Id. §§ 416.920(g), 416.920(h), 416.960(c). 

- 3 - 7001
 
 

 

 

 

 

step of the federal analysis, and the Administration, rather than the applicant, is 

“responsible for providing evidence that demonstrates that other work exists in 

significant numbers in the national economy that [the applicant] can do, given [the 

applicant’s] residual functional capacity and vocational factors.”9 Burden-shifting 

requires that the Administration present the testimony of a vocational expert when other 

methods of proof are insufficient. 10 If the Administration fails to carry its burden, the 

applicant is considered disabled and entitled to SSI benefits.11 

Determining eligibility for SSI can be a time-consuming process, lasting 

many months. To help alleviate hardship during the long application period, state 

interim assistance programs pay “assistance financed from State or local 

funds . . . furnished for meeting basic needs” of SSI applicants while their eligibility for 

federal benefits is being determined.12 The federal government reimburses Alaska for 

the interim assistance payments the State makes to individuals who are ultimately found 

to be entitled to SSI,13 but the State is responsible for determining the parameters of its 

interim assistance program, including the requirements for eligibility.14 

9 Id. § 416.960(c)(2). 

10 Id. § 416.966(e); see also BLOCH, supra note 3, § 3:36. 

11 See Bowen v. Yuckert, 482 U.S. 137, 146 n.5 (1987); Erickson v. Shalala, 

9 F.3d 813, 816-17 (9th Cir. 1993). 

12 42 U.S.C. § 1383(g)(3) (2012). 

13 See id. §§ 1383(g)(3)-(4); 20 C.F.R. § 416.1901(a). 

14 See, e.g., Kraft v. Comm’r of Pub. Welfare, 496 N.E.2d 1379, 1383-86 

(Mass. 1986) (discussing the relationship of federal and state law in interim assistance 

and stating that the federal statute and regulations “evince an intent to delegate to the 

States the power to determine the amount of such assistance and eligibility guidelines . . . 

(continued...) 

- 4 - 7001
 
 

 

Alaska’s interim assistance program is governed by AS 47.25.455, which 

provides: “The department shall pay at least $280 a month to a person eligible for 

assistance under this chapter while the eligibility of the person for benefits under [the SSI 

Program] is being determined.”15 A regulation, 7 AAC 40.180, provides that the 

Department will determine whether an applicant is eligible for interim assistance based 

on “whether the applicant is likely to be found disabled by the Social Security 

Administration, including whether the applicant’s impairment meets . . . [the] Social 

Security Administration disability criteria for the listings of impairments described in 

20 C.F.R. 404, subpart P, appendix 1.”16 The regulation further specifies that, “[i]n 

determining whether an applicant’s disability meets [these] criteria,” the Department will 

consider, among other things, whether the “impairment affects the applicant’s activities 

of daily living” and whether “the applicant can perform any other work, including 

sedentary work.”17 

14(...continued) 

[and] authorize the States to determine the appropriate methodology for calculating the 

amount of reimbursement due.”). 

15 AS 47.25.455(a). 

16 7 AAC 40.180(b)(1)(B) (2015). The regulation also requires the 

Department to examine “the SSI program’s presumptive disability criteria under 

20 C.F.R. 416.934,” 7 AAC 40.180(b)(1)(A), but Gross has not alleged eligibility under 

those criteria. 

While 7 AAC 40.180 has been amended since the events in question in this 

case, that amendment simply updated references to the Code of Federal Regulations 

without changing the substance or structure of the regulation. Compare former 

7 AAC 40.180 (am. 1/11/06), with 7 AAC 40.180 (am. 12/7/13). We therefore refer to 

the regulation’s most recent published version here. 

17 7 AAC 40.180(c)(3), (4). 

- 5 - 7001
 
 

 

 

B. Proceedings 

Lester Gross applied for federal SSI benefits and state interim assistance 

benefits in December 2011. He claimed eligibility for both based on a serious mental 

disorder. The Department denied Gross’s application for interim assistance. Based on 

information that Gross provided and using the five-step SSI analysis, the Department’s 

disability adjudicator determined at step five that Gross was not likely to be found 

eligible for SSI because there was “other work in the national economy” that he could 

perform, and that he was therefore not eligible for interim assistance. 

Gross requested a hearing, which was held in March 2012. The Department 

presented testimony from its disability adjudicator but not from a vocational expert. The 

hearing officer, interpreting 7 AAC 40.180 as incorporating all substantive and 

procedural aspects of the SSI analysis, concluded that Gross had failed to prove disability 

at step three. Proceeding to the remaining steps, however, the hearing officer concluded 

that under step five “the burden of proof shifts from the applicant to the agency” and that 

the Department had failed to meet its burden because it did not provide evidence that the 

jobs it identified for Gross actually existed in significant numbers in the national 

economy, nor had it provided the testimony of a vocational expert that Gross could 

perform those jobs. The hearing officer therefore found Gross eligible for interim 

assistance. 

After both Gross and the Department filed proposals for agency action,18 

the Department’s deputy commissioner issued a final decision.19 The deputy 

18 A proposal for action states a party’s position as to whether the agency 

should adopt, reverse, modify, or take other action on a hearing officer’s proposed 

decision. See AS 44.64.060(e). 

19 See AS 44.64.060(e)(5) (stating that the agency may, “in writing, reject, 

(continued...) 

- 6 - 7001
 
 

 

 

 

 

 

 

commissioner ruled that “7 AAC 40.180 incorporates only . . . steps 1, 2, and 3 of the SSI 

disability analysis” for determinations of eligibility for interim assistance, and that the 

regulation “does not require the Department to follow the analyses used in steps 4 and 5 

of the SSI analysis.”20 “In particular,” the deputy commissioner concluded, 

7 AAC 40.180 does not require the Department to present 

evidence through a vocational expert, and does not place any 

burden on the Department to prove[] (as SSA is required to 

do at step 5 of its analysis)[] that there is particular work in 

the national economy that the applicant is able to perform. 

Accordingly, because the hearing officer had determined that Gross was not likely to be 

found disabled at step three of the SSI analysis — finding him disabled only at step five 

— the deputy commissioner determined that Gross was not eligible for state interim 

assistance. 

Gross appealed the deputy commissioner’s decision to the superior court, 

which reversed it. Based on our decisions in Moore v. Beirne21 and State, Department 

of Health & Social Services v. Okuley,

22 the superior court concluded that the 

Department, when determining eligibility for the state interim assistance program, must 

follow all five steps of the SSI analysis. 

The Department petitioned for review. It argued that neither AS 47.25.455 

nor 7 AAC 40.180 requires it to undertake the full five-step federal analysis in evaluating 

19(...continued) 

modify, or amend an interpretation or application in the proposed decision of a statute 

or regulation directly governing the agency’s actions by specifying the reasons for the 

rejection, modification, or amendment, and issue a final agency decision”). 

20 Both emphases in original. 

21 714 P.2d 1284 (Alaska 1986). 

22 214 P.3d 247 (Alaska 2009). 

- 7 - 7001
 
 

 

 

 

 

 

 

 

 

eligibility for state interim assistance, and that its interpretation of the statute is otherwise 

permissible. The Department asked that we reverse the superior court’s decision and 

reinstate the decision of the deputy commissioner. 

We granted the petition. 

III. STANDARDS OF REVIEW 

“When a superior court acts as an intermediate appellate court in an 

administrative matter, we review the merits of the agency’s decision.”23 

The agency’s decision in this case is based on its application of a regulation. 

When examining regulations that were properly promulgated, “[w]e limit our review to 

‘whether the regulations are consistent with and reasonably necessary to carry out the 

purposes of the statutory provisions and whether the regulations are reasonable and not 

arbitrary.’ ”24 “In making the consistency determination, we use our independent 

judgment unless the ‘issue involves agency expertise or the determination of fundamental 

policy questions on subjects committed to an agency.’ ”25 “But the specific form our 

independent review takes is distinct from pure de novo review. We apply the 

substitution-of-judgment standard,” by which we “adopt the rule of law that is most 

23 State, Dep’t of Commerce, Cmty. & Econ. Dev., Div. of Ins. v. Alyeska 

Pipeline Serv. Co., 262 P.3d 593, 596 (Alaska 2011). 

24 Lakosh v. Alaska Dep’t of Envtl. Conservation, 49 P.3d 1111, 1114 (Alaska 

2002) (alterations omitted) (quoting Kelly v. Zamarello, 486 P.2d 906, 911 (Alaska 

1971)); accord Grunert v. State, 109 P.3d 924, 929 (Alaska 2005); see also 

AS 44.62.030. 

25 Lakosh, 49 P.3d at 1114 (quoting O’Callaghan v. Rue, 996 P.2d 88, 94 

(Alaska 2000)). We have explained that “ ‘reasonable necessity is not a requirement 

separate from consistency’ and the scope of review should center around consistency 

with the authorizing statute.” Bd. of Trade, Inc. v. State, Dep’t of Labor, Wage & Hour 

Admin., 968 P.2d 86, 89 (Alaska 1998) (quoting State, Bd. of Marine Pilots v. Renwick, 

936 P.2d 526, 531-32 (Alaska 1997)). 

- 8 - 7001
 
 

 

 

 

 

 

 

 

persuasive in light of precedent, reason, and policy, but in doing so we give due 

deliberative weight ‘to what the agency has done, especially where the agency 

interpretation is longstanding.’ ”26 In this case, the Department’s interpretation is due 

little deference based on longevity;27 Gross’s case appears to be the first in which the 

Department has adopted the interpretation at issue here, as the deputy commissioner 

noted in her decision.28 

IV. DISCUSSION 

The Department argues that AS 47.25.455 does not require use of the full 

five-step SSI analysis to determine eligibility for interim assistance and that 7 AAC 

40.180 — which the Department interprets as requiring only the first three steps — is 

therefore consistent with the statute. But because this interpretation of the statute would 

exclude from the interim assistance program an entire category of applicants potentially 

eligible for SSI, we reject the Department’s argument. 

26 Heller v. State, Dep’t of Revenue, 314 P.3d 69, 73 (Alaska 2013) (quoting 

Chugach Elec. Ass’n, Inc. v. Regulatory Comm’n of Alaska, 49 P.3d 246, 250 (Alaska 

2002)). 

27 See, e.g., Totemoff v. State, 905 P.2d 954, 968 (Alaska 1995) (stating that 

“if agency interpretation is neither consistent nor longstanding, the degree of deference 

it deserves is substantially diminished” (citing Bowen v. Am. Hosp. Ass’n, 476 U.S. 610, 

646 n.34 (1986))); Underwater Constr., Inc. v. Shirley, 884 P.2d 150, 153 n.11 (Alaska 

1994) (refusing to give agency’s inconsistent statutory interpretation any deference). 

28 While the Department suggests that it has advanced this argument in prior 

administrative proceedings, nothing in the record on appeal shows this to be the case. 

In the decision on Gross’s application, the deputy commissioner observed: “The 

Department is mindful that the ALJ’s proposed decision followed the interpretation of 

the Interim Assistance regulations previously applied by the Department’s former Office 

of Hearings and Appeals, and the interpretation adopted by the Director of the Division 

of Public Assistance in the Director’s Appeal decision issued on October 7, 2011 in 

OHA Case No. 11-FH-188.” 

- 9 - 7001
 
 

 

 

A. Why We Apply The Substitution Of Judgment Standard Of Review 

The Department argues that determining eligibility for interim assistance 

is “a policy decision and a judgment squarely within the agency’s area of expertise,” 

which we should review only to determine whether it has a reasonable basis. We use 

reasonable basis review “when the interpretation at issue implicates agency expertise or 

the determination of fundamental policies within the scope of the agency’s statutory 

functions.”29 Because the question in this case is one of statutory interpretation — 

requiring a determination of the legislature’s intent in creating the interim assistance 

program — we conclude that the substitution of judgment standard of review is 

appropriate instead. 

In support of its argument for reasonable basis review, the Department cites 

Marathon Oil Co. v. State.30 In that case we examined whether the Department of 

Natural Resources had permissibly denied a lessee’s request to apply retroactively a 

specific methodology for calculating royalties on gas leases. 31 We found the governing 

statute ambiguous as to “whether retroactive contract pricing is permitted.”32 We applied 

the reasonable basis standard of review because of our recognition that “[a]llowing 

retroactivity could have important consequences for how royalties are assessed and 

29 Marathon Oil Co. v. State, Dep’t of Natural Res., 254 P.3d 1078, 1082 

(Alaska 2011) (citing Matanuska-Susitna Borough v. Hammond, 726 P.2d 166, 175 

(Alaska 1986)). 

30 254 P.3d 1078 (Alaska 2011). 

31 See id. at 1081-82. 

32 Id. at 1085. 

- 10 - 7001
 
 

 

 

paid,” consequences the agency was more qualified than the courts to weigh.33 We 

observed that “[t]he state royalty and audit system is complicated, and DNR has expertise 

in deciding when retroactive application makes sense within that system.”34 We also 

noted that we were “especially inclined to defer when the agency’s statutory 

interpretation is long-standing,” as it was in Marathon Oil. 

35 

The question in this case is whether the Department may, consistent with 

the interim assistance statute, definitionally exclude persons who are eligible for SSI 

from eligibility for state interim assistance. Unlike Marathon Oil, answering that 

question does not require the “resolution of policy questions which lie within the 

agency’s expertise and are inseparable from the facts underlying the agency’s 

decision.”36 Rather, the answer depends on the legislature’s intent in creating the interim 

assistance program. “The question whether [the Department] properly interpreted the 

legislature’s mandate . . . is answerable through ‘statutory interpretation or other analysis 

of legal relationships about which courts have specialized knowledge and experience.’ 

Because this preliminary legal question resides within the traditional province of judicial 

33 Id. at 1082. 

34 Id. 

35 Id. at 1085. 

36 Id. (quoting Earth Res. Co. v. State, Dep’t of Revenue, 665 P.2d 960, 964 

(Alaska 1983)). 

- 11 - 7001
 
 

 

 

 

 

 

 

 

 

review and involves no technical expertise,”37 we employ the substitution of judgment 

standard.38 

The Department also urges us to defer to its interpretation because the adult 

public assistance statutes — of which the interim assistance program is a part — 

generally grant it the authority to “adopt regulations, not inconsistent with law, defining 

need, [and] prescribing the conditions of eligibility for assistance.”39 But the grant of 

regulatory authority in this case is unlike the broad grants of authority at issue in cases 

in which we have deferred to an agency decision. 40 Instead, because the issue is one of 

statutory interpretation, we apply the substitution of judgment standard, giving little 

deference to the agency’s new interpretation of the law, as explained above.41 

37 Lakosh v. Dep’t of Envtl. Conservation, 49 P.3d 1111, 1117 (Alaska 2002) 

(quoting Kelly v. Zamarello, 486 P.2d 906, 916 (Alaska 1971)). 

38 Heller v. State, Dep’t of Revenue, 314 P.3d 69, 73 (Alaska 2013) (“Because 

the interpretation involves legislative intent rather than agency expertise, we apply 

independent review here.”). 

39 AS 47.05.010(9). 

40 Cf. Kenai Peninsula Fisherman’s Coop. Ass’n v. State, 628 P.2d 897, 903 

(Alaska 1981) (reasoning that a statute allowing the Board of Fisheries to “make 

regulations it considers advisable” indicated “that the legislature intended to give the 

Board discretion to decide methods of regulation”); Kelly v. Zamarello, 486 P.2d 906, 

912 (Alaska 1971) (reasoning that a statute for competitive oil and gas leasing describing 

“such bonus as may be accepted by the Commissioner” of DNR indicated “that the 

legislature intended to give the Commissioner broad authority to determine the kind of 

bonus he will accept”). 

41 See Tesoro Alaska Petroleum Co. v. Kenai Pipe Line Co., 746 P.2d 896, 

902-04 (Alaska 1987) (“Tesoro argues that we should apply the ‘reasonable basis’ 

standard because the issues raised in these cases involve agency expertise and 

fundamental policy considerations in an area where the administrative agency has been 

(continued...) 

- 12 - 7001
 
 

 

 

 

 

 

 

 

Finally, in deciding this appeal we do not need to address whether the 

Department’s decision of Gross’s case has a reasonable basis in the regulation.42 For 

purposes of our decision we assume that the Department’s application of 7 AAC 40.180 

was based on a reasonable interpretation of it, leaving for our independent review only 

the question whether the regulation as so interpreted is consistent with the statute it was 

intended to implement. 

B.	 A Failure To Consider Steps Four And Five Of The SSI Analysis In 

Determining Eligibility For Interim Assistance Is Inconsistent With 

AS 47.25.455. 

The Department argues that nothing in AS 47.25.455 mandates use of the 

complete five-step federal SSI analysis to assess eligibility for state interim assistance, 

and that its interpretation of 7 AAC 40.180 as incorporating only the first three steps is 

therefore consistent with the statute. In particular, the Department argues that it is not 

required, as it would be at step five of the SSI analysis, to carry the burden of proving 

the existence of other work in the national economy that the applicant can perform, or 

to present expert testimony on that subject. We agree that the Department is not required 

to exactly replicate all procedural aspects of the five-step analysis; however, to the extent 

the Department’s interpretation excludes from interim assistance an entire category of 

41(...continued) 

granted broad regulatory authority. . . . [But b]ecause this case involves statutory 

interpretation, we conclude that the independent judgment test is the appropriate standard 

of review.”); supra notes 27-28 & accompanying text. 

42 Cf. Davis Wright Tremaine LLP v. State, Dep’t of Admin., 324 P.3d 294, 

301 (Alaska 2014) (“Assuming a regulation is valid, we review whether an agency’s 

interpretation of its regulation is plainly erroneous and inconsistent with the regulation 

— i.e., whether it has a reasonable basis.” (citation omitted) (internal quotation marks 

omitted)). 

- 13 -	 7001
 
 

 

 

 

 

 

 

 

 

 

 

disabled applicants — those who are entitled to federal benefits only because of step five 

— it is inconsistent with the statute. 

Alaska Statute 47.25.455(a) provides that “[t]he department shall pay at 

least $280 a month to a person eligible for assistance under this chapter while the 

eligibility of the person for benefits under [the SSI program] is being determined.” The 

Department contends that, because the statute requires that interim assistance be provided 

“while the eligibility of the person” for SSI is being determined, the legislature could not 

have intended that the Department apply the same analysis as that used by the federal 

government to determine SSI eligibility. It argues that the structure of the adult public 

assistance statutes in general supports its interpretation.43 

“[W]e interpret [a] statute according to reason, practicality, and common 

sense, considering the meaning of the statute’s language, its legislative history, and its 

purpose.”44 The language and structure of the relevant statutes do not directly answer 

the question whether the test for state interim assistance must be the same as that for SSI, 

but they do suggest that the two should closely track. Alaska Statute 47.25.455 specifies 

that benefits are to be paid “to a person eligible for assistance under this chapter while 

43 The Department also argues that the “policy and purpose” of Alaska 

Statutes Chapter 47 generally is “to cooperate and coordinate with the United States 

government in administering public assistance,” a purpose which is fulfilled through the 

reimbursement agreement between the state and federal governments, rather than through 

an identical definition of disability. The provisions allowing for reimbursement of 

interim assistance payments from the federal government, however, were not part of the 

initial interim assistance program, ch. 138, § 18, SLA 1982, and their subsequent 

addition, ch. 29, § 6, SLA 1993, did not imply a change in the overall purpose of or 

conditions of eligibility for the program. See, e.g., 1993 House Journal 87-88 

(Governor’s transmittal letter); Testimony of Jan Hansen, Div. of Pub. Assistance, at 

33:30–34:45, Hearing on H.B. 67 Before the House Judiciary Comm., 18th Leg., 1st 

Sess. (Mar. 15, 1993) (discussing interim assistance). 

44 Louie v. BP Exploration (Alaska), Inc., 327 P.3d 204, 206 (Alaska 2014). 

- 14 - 7001
 
 

 

 

 

 

 

 

 

 

the eligibility of the person for benefits under [the federal SSI program] is being 

determined”; the adult public assistance chapter specifies that a person is eligible if he 

or she is disabled, and it defines “disabled” in the same way the federal SSI program 

defines it. 45 The Department is correct, however, that the text of AS 47.25.455, which 

requires interim assistance payments “while the eligibility of the person for benefits 

under [SSI] is being determined” and therefore contemplates a more expedited decision, 

does not necessarily require that the test for interim assistance be exactly the same as the 

test for SSI. 

We directly addressed the interim assistance statute once before.46 In 

Moore v. Beirne, we held that AS 47.25.455 did not permit the Department to terminate 

interim assistance benefits based on the federal authorities’ preliminary denial of SSI 

benefits, but instead that interim assistance benefits must continue until the applicant’s 

45 Compare AS 47.25.615(5) (defining “disabled” as “being unable to engage 

in substantial gainful activity by reason of a medically determinable physical or mental 

impairment that can be expected to result in death or that has lasted or can be expected 

to last for a continuous period of not less than 12 months”), with 42 U.S.C. 

§ 1382c(a)(3)(A) (2012) (stating that “an individual shall be considered to be disabled 

for purposes of [the SSI program] if he is unable to engage in any substantial gainful 

activity by reason of any medically determinable physical or mental impairment which 

can be expected to result in death or which has lasted or can be expected to last for a 

continuous period of not less than twelve months”); see also 7 AAC 40.030 (stating that, 

to be eligible for adult public assistance, “[a]n applicant must meet the eligibility 

requirements of the SSI program . . . and the eligibility requirements set forth in [the 

Adult Public Assistance] chapter”). 

46 While the parties discuss our decision in State, Dep’t of Health & Soc. 

Servs. v. Okuley, 214 P.3d 247 (Alaska 2009), that case does not affect our analysis here. 

The facts underlying Okuley related to the Department’s failure to comply with the 

Administrative Procedure Act in enacting a prior version of 7 AAC 40.180. See id. at 

249-50 & 250 n.6. The merits of the case, however, related to attorney’s fees issues 

raised in subsequent class-action litigation, see id. at 252-58, and did not involve the 

interim assistance program itself. 

- 15 - 7001
 
 

 

 

 

 

 

SSI appeals had been exhausted and the Social Security Administration made a final 

decision on her entitlement to federal benefits. 47 The Department argues that nothing in 

Moore requires it to use the full five-part SSI analysis, and that Moore supports its 

interpretation of the statute because we recognized in that case that applicants for interim 

assistance and SSI are not similarly situated for equal protection purposes.48 

The Department is partly correct. As we noted in Moore, the legislature in 

creating the interim assistance program intended to codify the Department’s past practice 

of paying state benefits to SSI applicants while their entitlement to federal benefits was 

being determined.49 At that time, eligibility for interim assistance was assessed simply 

through the report of an accredited physician about the applicant’s likely entitlement to 

federal benefits,50 a process far less rigorous than the current one. Nothing in Moore 

requires the Department to exactly replicate the SSI analysis when it assesses eligibility 

for interim assistance. 

However, as we noted in Moore, “[t]he purpose of interim assistance is to 

alleviate hardship on applicants for SSI during the application period,”51 and the history 

of the program confirms that the legislature intended benefits to be broadly available to 

meet this purpose. It was recognized during development of the program that the waiting 

47 714 P.2d 1284, 1287 (Alaska 1986). 

48 See id. at 1287-88. 

49 Id. at 1286; see also Testimony of Rod Betit, Director, Div. of Pub. 

Assistance, at 48:30–51:30, Hearing on C.S.H.B. 357 (Rules) Before the Sen. Health, 

Educ. & Soc. Servs. Comm., 13th Leg., 1st Sess. (May 5, 1982). 

50 Moore, 714 P.2d at 1285 (“Interim assistance payments are granted after 

a preliminary examination of the applicant by a physician or psychiatrist.” (citing prior 

version of 7 AAC 40.180)). 

51 Id. 

- 16 - 7001
 
 

 

 

 

 

 

 

 

 

 

time for a determination of SSI eligibility was growing longer, and that assistance 

otherwise available to meet applicants’ basic needs during this period was insufficient.52 

Furthermore, when enacting the interim assistance program into law, the legislature 

eliminated the availability of other benefits pending a final SSI determination — benefits 

for which all SSI applicants had formerly been eligible — intending that interim 

assistance fill the gap.53 

And as already noted, the method of assessing eligibility at the time of the 

statute’s passage involved a much less rigorous process; rather than satisfying the federal 

eligibility criteria, an applicant for interim assistance had merely to “demonstrate[] some 

likelihood of meeting the statutory criteria for eligibility.”54 As the legislature intended 

to adopt the program currently in operation when it codified interim assistance,55 this 

again suggests a broadly available benefit. The interim assistance statute has been 

52 See Testimony of Rod Betit, Director, Div. of Pub. Assistance, at 

48:30–51:00, Hearing on C.S.H.B. 357 (Rules) Before the Sen. Health, Educ. & Soc. 

Servs. Comm., 13th Leg., 1st Sess. (May 5, 1982) (discussing development of the 

program codified as interim assistance in AS 47.25.455). 

53 Medicaid coverage for the interim period was eliminated as part of the 

package of legislation that included AS 47.25.455. Ch. 138, § 13, SLA 1982 (codified 

as amended at AS 47.07.020(e)); Testimony of Rod Betit, Director, Div. of Pub. 

Assistance, at 48:20–51:00, Hearing on C.S.H.B. 357 (Rules) Before the Sen. Health, 

Educ. & Soc. Servs. Comm., 13th Leg., 1st Sess. (May 7, 1982) (discussing genesis of 

program codified as Interim Assistance); Comments of Chairman Charlie Parr, at 

06:30–11:00, 43:45–45:00, Hearing on C.S.H.B. 357 (Rules) Before the Sen. Health, 

Educ. & Soc. Servs. Comm., 13th Leg., 1st Sess. (May 7, 1982) (discussing cuts to 

Medicaid benefits granted to individuals prior to a full federal disability determination 

and proposal to increase amount of Interim Assistance granted to cover medical bills 

prior to final determination). 

54 Moore, 714 P.2d at 1287. 

55 See supra note 49. 

- 17 - 7001
 
 

 

 

 

 

 

 

amended since its codification, but nothing in the later legislative history alters its 

broadly inclusive purpose. 

Also aiding our analysis is the rule “that a remedial statute is to be liberally 

construed to effectuate its purposes.” 56 Federal courts have recognized that the Social 

Security Act is remedial and must therefore be liberally construed. 57 We recognize the 

same remedial purposes in Alaska’s interim assistance program, which — as part of 

Alaska’s adult public assistance statutes — is intended “to furnish financial assistance 

as far as practicable to needy aged, blind, and disabled persons, and to help them attain 

self-support and or self-care.”58 

The Department’s interpretation of 7 AAC 40.180 to include only steps one, 

two, and three of the SSI analysis in determining eligibility for interim assistance would 

render an entire category of persons who are eligible for SSI — those deemed disabled 

at step five — ineligible for interim assistance. While the Department asserts that “[n]o 

argument or findings have been made in this case to support a theory that [its] 

interpretation of interim assistance actually results in an under-inclusive granting of 

56 State ex rel. Smith v. Tyonek Timber, Inc., 680 P.2d 1148, 1157 (Alaska 

1984). 

57 See Doran v. Schweiker, 681 F.2d 605, 607 (9th Cir. 1982) (“The Social 

Security Act is remedial, to be construed liberally.”); Haberman v. Finch, 418 F.2d 664, 

667 (2d Cir. 1969) (“[T]he Social Security Act is a remedial statute, to be broadly 

construed and liberally applied.”); see also Granberg v. Bowen, 716 F.Supp. 874, 878 

(W.D.Pa. 1989) (stating that the Supplemental Security Income program “is to be 

construed liberally to further its remedial purposes”). 

58 AS 47.25.590(b) (emphasis added). 

- 18 - 7001
 
 

 

 

 

 

 

 

 

 

 

interim assistance benefits to individuals later adjudicated disabled by SSI,” such underinclusion is an inevitable result of the Department’s interpretation.59 

The Department is certainly correct that it is consistent with AS 47.25.455 

to limit interim assistance benefits to those “likely to be found disabled”60 by the Social 

Security Administration for purposes of SSI and that, in doing so, it need not exactly 

replicate the entire set of procedures the Administration employs to determine eligibility 

for the federal program. However, the Department may not exclude from eligibility for 

interim assistance the entire category of persons eligible for SSI at step five.61 We leave 

it to the Department to decide in the first instance how it will satisfy the statutory 

mandate. 

59 Counsel for the Department suggested at oral argument before us that its 

three-step application of 7 AAC 40.180 effectively incorporates the substance of steps 

four and five because subsection (c)(4) provides that “[i]n determining whether an 

applicant’s disability meets the criteria set out in (b)(1)(B) of this section” (which is 

essentially step three of the SSI analysis), “the department will consider whether . . . the 

applicant can perform any other work, including sedentary work.” But the SSI analysis 

explicitly excludes consideration of vocational factors, such as the ability to perform 

other work, at step three. 20 C.F.R. § 416.920(d) (2014) (“If you have an impairment(s) 

which meets the duration requirement and is listed in appendix 1 or is equal to a listed 

impairment(s), we will find you disabled without considering your age, education, and 

work experience.”) (emphasis added). Under the Department’s interpretation, therefore, 

consideration of vocational factors could only serve to exclude from state benefits those 

who would be entitled to federal benefits at step three. 

60 7 AAC 40.180. 

61 Gross also argues that, by deciding his case based on a new interpretation 

of 7 AAC 40.180 imposed by the commissioner after the hearing, the Department 

violated his due process rights. Because we decide today that fuller consideration of 

Gross’s case is required under AS 47.25.455, we do not reach his due process claim. 

- 19 - 7001
 
 

V. CONCLUSION 

We AFFIRM the superior court’s decision in part, REVERSE it in part, and 

REMAND to the Department for proceedings consistent with this opinion. 

- 20 - 7001