CO Code § 26-2-128 (2021)
2021 Colorado Code|Title 26 - Human Services Code|Article 2 - Public Assistance|Part 1 - Colorado Public Assistance Act|§ 26-2-128. Recovery From Recipient - Estate

  If, at any time during the continuance of public assistance, the recipient thereof becomes possessed of any property having a value in excess of that amount set pursuant to the provisions of section 26-2-109 and the rules of the state department or receives any increase in income, the recipient shall notify the county department of the possession of such property or receipt of such income, and the county department may either terminate the public assistance or alter the amount of assistance payments in accordance with the circumstances and the rules of the state department. To the extent not otherwise prohibited by state or federal law, if the recipient is found to have committed an intentional program violation, the recipient is disqualified from participation in the public assistance program under this article 2 in which a recipient is found to have committed an intentional program violation for twelve months for the first incident, twenty-four months for a second incident, and permanently for a third or subsequent incident. Such disqualification is mandatory and is in addition to any other penalty imposed by law. Except as provided in subsections (3) and (4) of this section, any previously paid excess public assistance to which the recipient was not entitled is recoverable by the county as a debt due to the state and the county in proportion to the amount of public assistance paid by each respectively; except that any fraudulently obtained public assistance or fraudulently obtained overpayments of public assistance is recoverable and payable in proportionate shares as provided in section 26-1-112 (2)(b), and interest is charged and paid to the county department on any sum fraudulently obtained, calculated at the legal rate and calculated from the date the recipient obtained such sum to the date such sum is recovered. The following remedies apply for the enforcement and collection of a debt for fraudulently obtained public assistance or fraudulently obtained overpayments of public assistance:   If the debt for fraudulently obtained public assistance, fraudulently obtained overpayments of public assistance, or excess public assistance paid for which the recipient was ineligible has been reduced to a judgment in a court of record in this state, the county department may seek a continuing garnishment to collect the debt under article 54.5 of title 13, C.R.S.    If the person has received an overissuance of food stamp benefits resulting from fraud or willful misrepresentation that has not been recovered by repayment under section 13 (b)(1) of the federal “Food Stamp Act”, as amended, the state shall recover the overissuance by withholding unemployment compensation to which the person is entitled pursuant to section 8-73-102 (6), C.R.S.       If, upon the death or mental incompetency of any recipient, the inventory of the recipient's estate shows assets in excess of the amount that the recipient was allowed to have in order to receive public assistance, or if it be shown that the recipient was otherwise ineligible for public assistance, then the claim of the county and state for the excess public assistance paid for which the recipient was ineligible, if filed as required by section 15-12-804, C.R.S., shall have priority as a debt given preference under section 15-12-805 (1)(f.7), C.R.S.    Except as provided in subsection (4) of this section, when a recipient was ineligible for assistance payments solely because of property in excess of that permitted by state department rules and regulations adopted pursuant to section 26-2-109, the amount for which he shall be liable shall be the amount by which his property exceeded the amount allowable under such rules and regulations or the total amount of assistance payments thus received by him, whichever is the lesser amount. Actions for the recovery of such sums shall be prosecuted by the county or state department in any court of record having jurisdiction thereof.    Notwithstanding subsections (1), (2), and (3) of this section, in any assistance case in which more than the correct amount of payment has been made, there shall be no adjustment of payments to the county or state department or recovery by the county or state department from any person who is without fault and who has reported to the state department any increase in income or changes in resources or property, if such adjustment or recovery would deprive a person of income required for ordinary and necessary living expenses or would be against equity and good conscience. Overpayments in all cases involving a grant of aid to families with dependent children shall be recovered from the caretaker relative in the assistance unit who fraudulently obtained the public assistance or who was the direct payee of the overpayments or from such individual's estate. The state department and the county departments shall pursue all available overpayment recovery options against the caretaker relative in the assistance unit first and during this time all overpayment collection activities against the other overpaid members of the assistance unit shall be suspended. On March 26, 2002, the state department and the county departments shall cease any collection efforts being made against the children of an assistance unit in which public assistance was overpaid or fraudulently obtained by a caretaker relative if the caretaker relative has been located. The state and the county departments may elect not to attempt recovery of an overpayment from an individual no longer receiving public assistance where the overpayment amount is less than thirty-five dollars. Where the overpayment amount owed by an individual no longer receiving public assistance is thirty-five dollars or more, the state department and the county departments may determine, consistent with the six-year time limitation for the execution on judgments involving state debt, that it is no longer cost-effective to continue to pursue recovery of the overpayment. The state department and the county departments shall not pursue overpayment collection activities against children who have been part of a Colorado works program assistance unit.      When a recipient, during or because of continuance of public assistance, receives excess assistance through fraudulent acts, the county department shall make regular deductions consistent with federal regulations from said recipient's monthly grant until the excess payment is fully recovered.    Repealed.         The state department shall have a right to recover any amount of public assistance paid to a recipient because:   The trustee of a trust for the benefit of the recipient has used the trust property in a manner contrary to the terms of the trust;    A person holding the recipient's power of attorney has used the power for purposes other than the benefit of the recipient.       To enforce the right under this subsection (6), the county or state department may institute or intervene in legal proceedings against the trustee or person holding the power of attorney. Any amount of public assistance recovered pursuant to this subsection (6) shall be distributed between the state and county in proportion to the amount of public assistance paid by each respectively.    No action taken by the county or state department pursuant to this subsection (6) or any judgment rendered in such action or proceeding shall be a bar to any action upon the claim or cause of action of the recipient or his guardian, personal representative, estate, dependent, or survivors against the trustee or person holding the power of attorney.        History. Source: L. 73: R&RE, pp. 1193, 1649, §§ 2, 12. C.R.S. 1963: § 119-3-28. L. 75: (1) and (3) amended and (4) added, p. 896, § 1, effective June 23. L. 77: (1) amended and (5) added, p. 1335, § 6, effective January 1, 1978. L. 79: (5)(b) repealed, p. 1093, § 2, effective June 21. L. 81: (6) added, p. 1373, § 1, effective May 18; (1) amended, p. 1371, § 2, effective June 5. L. 91: (4) amended, p. 1863, § 7, effective July 1. L. 94: (1) amended, p. 2063, § 5, effective July 1. L. 2002: (4) amended, p. 114, § 1, effective March 26. L. 2006: (1) and (2) amended, p. 946, § 1, effective August 7. L. 2020: IP(1) amended,(SB 20-206), ch. 222, p. 1096, § 2, effective July 2. History. Source: L. 73: R&RE, pp. 1193, 1649, §§ 2, 12. C.R.S. 1963: § 119-3-28. L. 75: (1) and (3) amended and (4) added, p. 896, § 1, effective June 23. L. 77: (1) amended and (5) added, p. 1335, § 6, effective January 1, 1978. L. 79: (5)(b) repealed, p. 1093, § 2, effective June 21. L. 81: (6) added, p. 1373, § 1, effective May 18; (1) amended, p. 1371, § 2, effective June 5. L. 91: (4) amended, p. 1863, § 7, effective July 1. L. 94: (1) amended, p. 2063, § 5, effective July 1. L. 2002: (4) amended, p. 114, § 1, effective March 26. L. 2006: (1) and (2) amended, p. 946, § 1, effective August 7. L. 2020: IP(1) amended,(SB 20-206), ch. 222, p. 1096, § 2, effective July 2.    Cross references:   For the legislative intent contained in the 2006 act amending subsections (1) and (2), see section 8(2) of chapter 208, Session Laws of Colorado 2006.   ANNOTATION   Law reviews. For article, “Collecting Pre- and Post-Judgment Interest in Colorado: A Primer”, see 15 Colo. Law. 753 (1986). For article, “An Update of Appendices from Collecting Pre- and Post-Judgment Interest in Colorado”, see 15 Colo. Law. 990 (1986).   Public policy. To sanction the channeling of fraudulently obtained moneys to undeserving heirs and permitting them to profit from illegal and fraudulent actions would be against public policy. State v. Estate of Griffith, 130 Colo. 312 , 275 P.2d 945 (1954); Kostelc v. Lake County Dept. of Pub. Welfare, 122 Colo. 481 , 223 P.2d 614 (1950); Denver Dept. of Pub. Welfare v. Wysowatcky, 133 Colo. 153 , 292 P.2d 735 (1956).   Recovery permitted if payment made by mistake. If it is disclosed that the pensioner was in possession of property or securities that exceeded the maximum allowed, then there need be no showing of fraud in order to recover, if there has been a mistake either on the part of the pensioner or the department. The mistake may be unilateral, but if there was an excess of assets in the hands of the pensioner, it is recoverable. Denver Dept. of Pub. Welfare v. Wysowatcky, 133 Colo. 153 , 292 P.2d 735 (1956).   As part of restitution for fraudulently obtained food stamps in violation of this section, the court, pursuant to § 16-11-204.5 , properly included interest calculated in accordance with § 5-12-102 . It was error, however, for the court to consider only the victim's pecuniary loss and not the defendant's ability to pay. People v. Valenzuela, 874 P.2d 420 (Colo. App. 1994), aff'd in part and rev'd in part on other grounds, 893 P.2d 97 (Colo. 1995).   Interest payable for fraudulently obtained food stamps accrues from the time the state reimburses the federal government for the fraudulently obtained food stamps. Interest should accrue only from the time of the actual injury, and the state suffers actual loss only when it reimburses the federal government. Valenzuela v. People, 893 P.2d 97 (Colo. 1995).   The prosecution is not required to show that the state actually lost interest or had to pay interest as a result of defendant's conduct. Where the defendant wrongfully deprived the state of the funds, statutory law requires that she repay the amount with interest to compensate the state for the loss of use of the funds. Valenzuela v. People, 893 P.2d 97 (Colo. 1995).   Applied in Adams County Dept. of Soc. Servs. v. Frederick, 44 Colo. App. 378, 613 P.2d 642 (1980).