Arkansas Administrative Code › Agency 016 - DEPARTMENT OF HUMAN SERVICES › Division 20 - Division of County Operations › Rule 016.20.00-006 - TEA Policy 2272 - Resources to be Disregarded, Policy 2341 - Earned Income to be Disregarded, Policy 2344 - Computation of Earnings from Self-Employment , Policy 3223.2 - Micro-Enterprise Escrow Account

Current through Register Vol. 49, No. 6, June, 2024
3223
			 Micro-enterprise (Self-Employment)
Definition/Purpose
The Micro-enterprise activity is designed to allow individuals
				to engage In self-employment enterprises. It may include individuals who are
				already self-employed, those wanting to expand a self-employment enterprise,
				and those expressing an interest in developing and starting a
				Micro-enterprise.
Micro-enterprise activities may include but are not limited
				to:
* receiving instructions on the development of a business
				plan;
* working in a self-employment business; or
* participating in a micro-lending program and associated
				activities.
A Micro-lending program is one that provides training,
				technical assistance and loan funds to low-income entrepreneurs to start or
				expand a business venture.
As part of the micro-enterprise program, individuals will be
				allowed to escrow profits into an escrow account (Refer to TEA policy
				3223.2).
Discussion with Client
The Case Manager will discuss micro-enterprise activities with
				the recipient. If he or she indicates an interest in developing a business, the
				Case Manager will discuss the requirements of the program that will include the
				completion of a micro-enterprise assessment packet. During the assessment
				interview, the Case Manager will work with the client to determine his or her
				goals. The Case Manager will explain the availability of agencies in the area,
				which offer basic business skills training.
The Case Manager will assist the client in the completion of
				the assessment packet and, if appropriate, refer the client to a micro-lending
				agency or Small Business Administration (SBA). The Case Manager will also
				coordinate with the micro-lending agency or SBA for technical assistance with
				completion of the assessment packet.
Assessment Packet
Each county office will be responsible for coordinating with a
				local micro-lending agency or SBA to obtain or develop a micro-enterprise
				assessment packet to be completed by recipients interested in the
				micro-enterprise activity.
The assessment packet will include the following
				information;
[GREATER THAN] Business Summary - provides an overview of why
				the individual wants to enter into a business, the type of services or products
				the business provides and the goals and objectives that he or she may have for
				the business.
[GREATER THAN] Marketing Plan - identifies the area to be
				served, pricing and sales strategies and how the business will be
				promoted.
[GREATER THAN] Production Plan - identifies and describes how
				business products and services will be produced and made available to the
				customers.
[GREATER THAN] Financial Summary - is an overview of the
				projected cost for operating a business (e.g. cash flow, start-up costs, etc.)
				to achieve a profit.
[GREATER THAN] Narrative - summarizes the individual's goals
				and objectives and explains why he or she is committed to making a success in
				the business venture.
The recipient must complete the assessment packet to
				participate in a micro-enterprise activity. The Case Manager will assist the
				client in the completion of the packet. If determined appropriate, the client
				will be referred to a local micro-lending agency or SBA. (Refer to TEA
				3223.1)
If an individual is engaged in Micro-enterprise activities for
				at least the minimum number of hours as required in TEA policy 3201, the
				activity in and of Itself will meet the work activity participation
				requirements.
Supportive Services are available if needed for individuals who
				are engaged in Micro-enterprise activities. This may include the purchase of
				start-up supplies if no other funds are available.
3223.1
Coordinating witti
			 Micro-lending Programs
The County will determine what micro-lending agencies are
				available in the area (e.g. Good Faith Fund). Contact will be made to those
				agencies and coordination procedures developed for the referral of clients to
				the organizations. The location of the sites should be easily accessible to
				clients. In counties in which there are no accessible micro-enterprise
				development organizations, contact will be made with the Small Business
				Administration for coordination and referral procedures. .
A referral will be made via form DHS-3350 and any other
				documents as determined through coordination with the micro-lending agency. The
				worker will make a referral to the agency that is believed to best suit the
				needs of the client.
3223.2
Escrow Account
The maximum amount of funds deposited into an escrow account
				that can be disregarded as a resource is $10,000.00.
A TEA recipient may escrow profits from his or her business,
				which are not reinvested into the business, into a micro-enterprise escrow
				account. The funds placed in the escrow account will not count when computing
				the monthly gross self-employment income.
In addition, a TEA recipient will not lose any transitional or
				extended support services available to him or her for the life of the escrow
				account.
The purpose of the escrow account is to allow the individual to
				set aside a percent of his or her profits for future use (e.g. expand business,
				update equipment, make repairs, etc.).
The amount an individual places in an escrow account should be
				determined on
a
case by case basis. The amount deposited should
				not affect his or her ability to meet daily living expenses.
13. Individual Development Accounts (IDA).
			 (See TEA 3445)
14. Funds up to
			 $10,000.00 placed in an escrow account by a TEA recipient who is engaged in a
			 micro-enterprise work activity.
NOTE:
At any time there is a question as to
				whether a particular type of property or payment may be disregarded unde'r Item
				#10 above, the worker should submit the pertinent documents or information
				concerning the property or payment to the Office of Program Planning and
				Development, Slot 1220 for a determination. This information should include the
				specific federal or state statute under which it is believed the disregarded
				treatment is required.