Opinion ID: 1992362
Heading Depth: 4
Heading Rank: 1

Heading: historical and political context

Text: First, we consider the occasion and necessity for the statute, the circumstances under which it was enacted, the mischief to be remedied; the object to be attained; and the former law, including other statutes upon the same or similar subjects. 1 Pa.C.S.A. § 1921(c)(1-5). Essentially, we consider the historical and political context in which the legislation at issue was adopted. The early law of this Commonwealth regarding the relief of the poor may be summarized as follows. The father, grandfather, mother, grandmother, and children of any poor person unable to work were required to provide subsistence support to their poor relation. Likewise, husbands were required to provide subsistence support to their wife and children. These obligations could be enforced by court order and imprisonment for contempt. If no relative was able to provide support, then the local community was required to provide subsistence support. Poor persons on relief were to be put to work if able bodied, and removed from the community if the poor person did not have a lawful settlement there. Blind, crippled, and insane poor were maintained in their homes or in public almshouses. When the poor person died, the community was entitled to recoup the expense of the support provided by claiming whatever estate the poor person left. Though the terms of the early poor laws seem hardly likely to induce fraudulent claims for relief, the early poor laws nonetheless guarded against such claims by requiring lawful settlement (residency) and by providing that no person was to be entered into the Poor Book and given relief except by order of two magistrates or justices of the peace. [2] These laws were derived from earlier English poor laws. [3] The prior English law had itself evolved from parish customs regarding the allocation of a portion of the tithe to the relief of the poor. [4] The administration of Pennsylvania's early system of poor laws was fragmented and decentralized. By 1936, poor relief was being administered by a patchwork of nearly 500 agencies whose related functions and responsibilities inevitably resulted in overlapping of jurisdiction, duplication of effort, conflict of parties, and multiplication of costs. In addition to the traditional poor boards, Pennsylvania had created by then special funds for assistance of mothers, the blind, the aged, veterans, and the unemployed. See Poor District Case (No. 1), 329 Pa. 390, 395-96 & n., 197 A. 334, 336-37 & n. (1938); see also The Unemployment Compensation Law, 1936 2d Ex, P.L. 2897, No. 1; The Blind Pension Act, Ex 1933, P.L. 246, No. 61; Old Age Assistance Act, Ex 1933, P.L. 282, No. 64; Old Age Commission Act, 1923, P.L. 189, No. 141; World War Veteran's Compensation Act, 1923, P.L. 236, No. 156; Mother's Assistance Act, 1913, P.L. 118, No. 80. Significantly, each of the above statutes contained penalty provisions authorizing the imposition fines and/or imprisonment upon fraudulent claimants. The general poor law had not provided for such penalties. See The General Poor Relief Act, 1925, P.L. 762, No. 413. The Great Depression highlighted and exacerbated the substantive and administrative difficulties caused by the fragmented poor relief system. In 1936, the Goodrich Report of the Pennsylvania Committee on Public Assistance and Relief became both a catalyst and a blueprint for reform. Among the acts passed as a direct result of the Goodrich Report was the Public Assistance Law, 1937, P.L. 2051, No. 399, which abolished the fragmented agencies and replaced them with 67 county boards which were to distribute relief benefits from funds allocated to them by the Commonwealth Department of Public Assistance. Significantly, the new act contained the following provision (which is the direct antecedent of the statute construed in the instant case): Section 13. Penalties.  Any person who, by means of a wilfully false statement or misrepresentation, or by impersonation or other fraudulent means, secures, or attempts to secure, or aids or abets any person in securing assistance under this act shall be guilty of a misdemeanor, and, upon conviction thereof, shall be sentenced to pay a fine not exceeding one thousand dollars ($1000.00), or to undergo imprisonment not exceeding one year, or both, at the discretion of the court, and also may be sentenced to make restitutions of any moneys he has received by reason of any such false statement, misrepresentation or fraudulent means. (Emphasis added). The original restitution provision was plainly discretionary. The above provision underwent a series of revisions between 1936 and 1982, when the present provision was enacted. In 1937, the provision was amended as follows: Section 13. Penalties.  (a) Any person who, either prior to, or at the time of, or subsequent to the application for assistance, by means of a wilfully false statement or misrepresentation, or by impersonation or other fraudulent means, secures, or attempts to secure, or aids or abets any person in securing assistance under this act shall be guilty of a misdemeanor, and, upon conviction thereof, shall be sentenced to pay a fine not exceeding [one thousand dollars ($1,000.00)] five hundred dollars ($500.00), or to undergo imprisonment not exceeding [one year] six months, or both, at the discretion of the court, and also [may] shall be sentenced to make restitution of any moneys he has received by reason of any such false statement, misrepresentation, impersonation, or fraudulent means. 1939, June 26, P.L. 1091, No. 384 (brackets indicate deletion, emphasis indicates additions). Though the amount of the fine and imprisonment authorized was reduced, the discretionary restitution provision was plainly made mandatory. See Strauss & Rome, The Child and the Law in Pennsylvania, at 110 (1943) (construing the act to provide that, restitution of moneys received as a result of fraud must be made. (Emphasis added). When the Public Welfare Code was enacted in 1967, the penalty provision was amended to provide: § 481. False statements; penalty (a) Any person who, either prior to, or at the time of, or subsequent to the application for assistance, by means of a wilfully false statement of misrepresentation, or by impersonation or other fraudulent means, secures, or attempts to secure, or aids or abets any person in securing assistance under this article shall be guilty of a misdemeanor, and, upon conviction thereof, shall be sentenced to pay a fine not exceeding one thousand dollars ($1,000), or to undergo imprisonment not exceeding one year, or both, and also shall be sentenced to make restitution of any moneys he has received by reason of any such false statement, misrepresentation, impersonation, or fraudulent means. (b) Any person who, either prior to or at the time of or subsequent to the application for assistance, by means of a wilfully false statement or misrepresentation, or by impersonation, or other fraudulent means, secures or attempts to secure assistance not exceeding three hundred dollars ($300) under this article shall, upon conviction thereof in a summary proceeding, be sentenced to make restitution of such assistance, and to pay a fine of not more than two hundred dollars ($200), and, in default of making restitution and the payment of the fine imposed, to undergo imprisonment not exceeding sixty days. 1967, June 13, P.L. 30, No. 21, art. 4, § 481, codified at 62 Pa.Code § 481. (Emphasis added). This act provided for gradation of welfare fraud based upon the amount involved, retained the mandatory restitution provision, and specifically authorized imprisonment upon default of making restitution. In 1976, the above provision was amended as follows: Section 481. False Statements; Penalty.  (a) Any person who, either prior to, or at the time of, or subsequent to the application for assistance, by means of a wilfully false statement of misrepresentation, or by impersonation or other fraudulent means, secures, or attempts to secure, or aids or abets any person in securing assistance, or Federal food stamps, under this article shall be guilty of a misdemeanor, and, upon conviction thereof, shall be sentenced to pay a fine not exceeding one thousand dollars ($1,000), or to undergo imprisonment not exceeding one year, or both, and also shall be sentenced to make restitution of any moneys he has received by reason of any such false statement, misrepresentation, impersonation, or fraudulent means. (b) Any person who, either prior to or at the time of or subsequent to the application for assistance, by means of a wilfully false statement or secures or attempts to secure assistance or Federal food stamps not exceeding three hundred dollars ($300) under this article shall, upon conviction thereof in a summary proceeding, be sentenced to make restitution of such assistance, and to pay a fine of not more than two hundred dollars ($200). [and, in default of making restitution and the payment of the fine imposed, to undergo imprisonment not exceeding sixty days.] When having available sufficient means or the ability to acquire such means, wilfull failure to make restitution and pay the fine imposed shall result in imprisonment not exceeding sixty days. (c) There shall be a four-year statute of limitations on all offenses under this section. 1976, June 15, P.L. 993, No. 202, § 481 (brackets indicate deletions, emphasis indicates additions). These revisions brought food stamp fraud expressly within the scope of the provision, retained the mandatory restitution provision, limited imprisonment to cases of wilful default of making restitution or paying fines, and imposed a four year statute of limitations on the prosecution of welfare fraud offenses under the act. In 1982, the 1976 provision was revised to provide as follows: § 481. False statements; investigations; penalty (a) Any person who, either prior to, or at the time of, or subsequent to the application for assistance, by means of a wilfully false statement or misrepresentation, or by impersonation or other fraudulent means, secures, or attempts to secure, or aids or abets or attempts to aid or abet any person in securing assistance, or Federal food stamps, commits a crime which shall be graded as provided in subsection (b). (b) Any person violating subsection (a) commits the grade of crime determined from the following schedule: Amount of Assistance or Food Stamps Degree of Crime $3,000 or more Felony of the third degree $1,500 to $2,999 Misdemeanor of the first degree $1,000 to $1,499 Misdemeanor of the second degree $999 and under, or an attempt to Misdemeanor of the third degree commit any act prohibited in subsection (a) Pursuant to 42 Pa.C.S. § 1515(a)(7) (relating to jurisdiction and venue), jurisdiction over cases graded a misdemeanor of the third degree under this section shall be vested in district justices. (c) Any person committing a crime enumerated in subsection (a) shall be ordered to pay restitution of any moneys he has received by reason of any false statement, misrepresentation, impersonation, failure to disclose required information or fraudulent means. Restitution ordered under this subsection may be paid in a lump sum, by monthly installments or according to such other schedule as is deemed just by the sentencing court. Notwithstanding the provisions of 18 Pa.C.S. § 1106(c)(2) (relating to restitution for injuries to person or property) to the contrary, the period of time during which the offender is ordered to make restitution may exceed the maximum term of imprisonment to which the offender could have been sentenced for the crime of which he was convicted, if the sentencing court determines such period to be reasonable and in the interests of justice. (d) There shall be a four-year statute of limitations on all crimes enumerated in subsection (a). (e) The Treasury Department shall have the power to investigate and prosecute any case involving replacement of or duplicate receipt of or altered assistance checks and shall have the power to collect any funds as a result of such investigations and prosecution. For purposes of this section those employes of the Treasury Department as are designated `investigators' are given the power and authority to subpoena any document for review or audit and may question and subpoena any person believed to have any knowledge in such cases. The Treasury Department shall make such rules and regulations as may be necessary to carry out the provisions of this section. 1982, April 8, P.L. 231, No. 75, § 21 (effective in 60 days). (Emphasis added). The act provided a new standard for grading the offenses, retained mandatory restitution, authorized periodic payments toward restitution ordered, and exempted restitution orders under this provision from the limits upon the period during which restitution payments could be required under 18 Pa.C.S.A. § 1106(c)(2). Plainly, the mischief to be remedied by the foregoing statutes was welfare fraud. Pennsylvania has a paramount interest in seeing that its limited public assistance funds are distributed as provided by law. See Wyman v. James, 400 U.S. 309, 319-20, 91 S.Ct. 381, 386-87, 27 L.Ed.2d 408, 414 (1971). If some welfare recipients receive more than their rightful share of these finite resources through fraud, then it is likely that other needy persons will be adversely affected either by reductions in assistance, or by the Commonwealth's inability to increase assistance. Cf. Jacquet v. Westerfield, 569 F.2d 1339, 1340 (5th Cir. 1978). Moreover, deterrence of welfare fraud is necessary to maintain public support for such programs. Prior to the final Senate vote on the 1976 amendments, Senator Kury expressed that concern as follows: No system can function if its integrity is under attack. No one here needs to be reminded that the integrity of public welfare in Pennsylvania is less than sound. The plain fact is that there are a host of hard working, productive, taxpaying citizens in this State who look at the welfare program and conclude that there are a lot of people getting something for nothing out of it at their expense. That outrages them, and in many respects, that outrage is justified. That is why House Bill No. 694 is so important. It is a measure which, in its largest sense, attempts to reinforce the integrity of the welfare system. It is a measure which says to the productive citizens of this State, we in the General Assembly are intent in rectifying the inequities of the welfare system. It says that we are serious in our efforts to curb the potential for fraud or abuse of that system.       The general public is very suspicious of the welfare program as it currently functions. Until that suspicion is overcome, welfare will never achieve a position of widespread public acceptance. Without that acceptance, it just cannot function properly. 1 Sen.Leg.J. 1742-43 (June 22, 1976). We believe these remarks are indicative of the sentiments which underly welfare fraud sanctions in general. Cf. Bowen v. Roy, 476 U.S. 693, 709, 106 S.Ct. 2147, 2157, 90 L.Ed.2d 735, 751 (1986) quoting 127 Cong.Rec. 24783 (1981) ([w]e know that however generously motivated Americans may be to furnish resources to the poor to enable them to survive, . . . they understandably object if they believe that those resources are being abused or wasted. . . .); Clark, Cracking Down on Fraud, Waste, Abuse and Error, 11 National Journal 96, 96 (1979) ([u]nless these [reform] efforts succeed, the [Carter] Administration fears, Congress may kill the social programs which breed most of the fraud and waste.). Deterrence of welfare fraud is not an easy task: As welfare programs have grown, so have opportunities for cheating. Isolating individual cases is difficult, time consuming and expensive for federal and state investigators; recouping misspent funds is an even taller order. Demkovich, Welfare Cheating  Dealing With the Problem Not the Image, 14 National Journal 1719, 791 (1982) (outlining federal initiatives to deter welfare fraud, waste and error during the first two years of the Reagan Administration). [5] Moreover, in large cities like Philadelphia, limited law enforcement resources are often by necessity focused on combatting violent crime rather than welfare fraud, thus making the task even more difficult. See Commonwealth, Department of Public Welfare v. Heckler, 730 F.2d 923, 924 (3rd Cir. 1984) (`[d]ue to a dearth of funds and a surfeit of violent crimes, the Philadelphia DA had lagged far behind the rest of the state in prosecuting welfare fraud cases referred by DPW.). Nonetheless, welfare reform efforts have begun to show encouraging results. See generally Demkovich, supra; see also Bowen v. Roy, supra, 476 U.S. at 710-11, 106 S.Ct. at 2157-58, 90 L.Ed.2d at 751-52 (noting the success of computer matching programs in detecting welfare fraud); Commonwealth, Department of Public Welfare v. Heckler, supra, 730 F.2d at 924 (noting that following adoption of a cost-sharing plan with the state, the number of welfare fraud prosecutions in Philadelphia jumped from 16 in 1980 to 400 in 1982 and that by March 1983 the Philadelphia DA had obtained restitution orders totalling $905,588). In fiscal year 1987-88 the Pennsylvania Department of Welfare's Office of Fraud and Abuse Investigation and Recovery recovered a staggering $2,820,115.00 in Public Assistance claims and an additional $442,527.00 in Food Stamp claims. See BSC-056 & RMS-056 Reports, unpublished (Pa.D.P.W. 1988) (available from the Office of Fraud and Abuse Investigation and Recovery); see also Office of Fraud and Abuse Investigation and Recovery Final Report Fiscal Year 1986-87, passim (Pa.D.P.W. 1988) (providing detailed statistics concerning welfare fraud restitution). Plainly, restitution orders have become an important component of welfare fraud sanction and deterrence efforts. In sum, we find that the historical and political context in which the statute was enacted supports a conclusion that the restitution provision of the 1982 act was intended to retain the mandatory character of the 1937, 1967, and 1976 acts which preceded it. Such a construction is likewise in harmony with our analysis of the mischief to be remedied and the object to be attained by the provision, i.e. to sanction and deter welfare fraud.