Court Opinion

ID: 5294
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:04:27+00
Date Added: 2024-06-11T13:24:57.361297
License: Public Domain

United States Court of Appeals,

                                            Fifth Circuit.

                                           No. 92–1463

                                        Summary Calendar.

                      Anita WILLIAMS and her Children, Plaintiffs–Appellants,

                                                 v.

     Burton RAIFORD, Commissioner of the Texas Department of Human Services, et al.,
Defendants–Appellees.

                                           Nov. 6, 1992.

Appeal from the United States District Court for the Northern District of Texas.

Before GOLDBERG, KING and GARWOOD, Circuit Judges.

          PER CURIAM:

          Plaintiffs are a family who received financial assistance through Aid to Families with

Dependent Children ("AFDC")1 and food stamps under the Food Stamp Program,2 until the Texas

Department of Human Services ("TDHS") determined that the family was no longer eligible for those

benefits because one child had come into the equivalent of a small inheritance upon the death of her

father.3 Although the money is controlled by a representative payee who will not release the funds

for purposes of supporting the family, the Texas Depart ment of Human Services ("TDHS")

nevertheless "deemed" the child's assets available to support the child and the rest of her family.

Plaintiffs sued the commissioner of the Texas Department of Human Services under 42 U.S.C. § 1983

   1
       42 U.S.C. § 601 et seq.
   2
       7 U.S.C. § 2011 et seq.
   3
     On the death of her father, the child obtained Old–Age, Survivors, and Disability Insurance
Benefits ("OASDI"), including a monthly payment of $519, which the parties do not dispute is
"deemable" to the family and reduces their eligibility for AFDC and food stamps, and an $11,844
lump sum, constituting retroactive OASDI benefits, of which $8,000 was used by the child's
state-appointed representative payee to purchase a certificate of deposit on the child's behalf. The
representative payee invested the $8,000 in the hope of preserving the funds for the education of
the child after she attains majority. The representative payee has indicated a willingness to release
these funds prior to that time if necessary for the child's welfare, but has not considered the
family's loss of AFDC and food stamps to present such a necessity. The representative payee
resides outside the plaintiffs' household.
(action for deprivation of civil rights under color of state law), 42 U.S.C. § 1396a(a)(17)(D)

(Medicaid Program), 42 U.S.C. § 407 et seq. (Social Security), 7 U.S.C. § 2011 et seq. (Food Stamp

Program).

        Plaintiffs contend that a child does not have a duty to support her family with her own assets.

We do not address this global claim, for it is not necessary to decide whether a child's assets may be

reached in order to prevent the family's destitution. We find that it is well established that a child's

assets may be reached by her siblings and other family members residing in the same househo ld if

necessary to prevent or reduce their reliance on welfare benefits. See Bowen v. Gilliard, 483 U.S.

587, 107 S.Ct. 3008, 97 L.Ed.2d 485 (1987); Jackson v. Jackson, 857 F.2d 951, 955–56 (4th

Cir.1988).

        Plaintiffs contend that even if the child do es have a duty to support her family, when a

representative payee or trustee residing outside the household controls the child's assets and refuses

to release them, the assets may not be deemed "available" to the family for purposes of determining

eligibility for AFDC and food stamps. Although plaintiffs have found support for this proposition in

the discussion sect ion of the regulations implementing the Deficit Reduction Act of 1984

("DEFRA"),4 which at least one other circuit has found compelling,5 we find it unpersuasive in light

of the overwhelming evidence that Congress sought, through DEFRA, to assure that only the most

needy receive benefits, and sought, in particular, to "end the present practice whereby families exclude

   4
    The Supplementary Information, Discussion of Major Provisions section of the AFDC interim
rules under DEFRA, includes the following language:

               When title II [OASDI] benefits are paid to a representative payee on behalf of a
               member of the assistance unit and the payee lives in the same household as the
               assistance unit, the title II benefits must be counted as income. When the
               representative payee does not live in the household, the title II benefits are
               included only to the extent that the payee makes them available for the support of
               the beneficiary.

       49 Fed.Reg. 35586, 35589 (1984).
   5
    See Cunningham Through Conner v. Toan, 762 F.2d 63, 66 (8th Cir.1985) ("If the
representative payee does not live in the same household as the OASDI beneficiary and the
dependent child, appellants must consider the OASDI benefits as income available for the purpose
of AFDC eligibility and grant amount determinations only to the extent that the representative
payee makes the OASDI benefits available for the support of the OASDI beneficiary").
members with income in order to maximize family benefits, and [to] ... ensure that the income of

family members who live together and share expenses is recognized and counted as available to the

family as a whole." Gilliard, 483 U.S. at 593, 107 S.Ct. at 3013 (quoting S.Rep. No. 98–169 at

980). Section 402(a)(38) of the Act implementing Aid to Families with Dependent Children provides

that "any income of or available for"6 a family member living in the same household as the rest of his

or her family is to be included in making the determination of the family's eligibility for AFDC, and

specifically notes that 42 U.S.C. § 405(j) (providing for the appointment of representative payees)

is no obstacle. See 42 U.S.C. § 602(a)(38). Thus, one of the duties of the representative payee is

to perform the function within the dictates of 42 U.S.C. § 602(a)(38).7

       The fact that plaintiffs do not contest the application of the child's monthly OASDI income

to determinations regarding the family's eligibility for AFDC8 suggests they understand the weakness

of their argument that the child's assets must be preserved even while the family is forced to rely on

welfare for support. The heart of the dispute, therefore, is no t whether the child's assets may be

applied to support other family members who otherwise would be forced to rely on welfare, but

whether the representative payee may shelter the child's retroactive benefits, despite the fact that the

back benefits are not different in kind from the monthly income received by the child.9

   6
    We see no reason to limit the term "income" so as to exclude assets in this case, especially
since the assets in question are simply the accumulated total of retroactive benefits which the child
otherwise would have received monthly.
   7
    42 U.S.C. § 407, which provides that OASDI benefits are not transferable or assignable, is no
barrier, both because it must be read in light of the later enacted 42 U.S.C. § 602(a)(38), and
because it covers different situations than the one presented here. In making the child's OASDI
benefits available for purposes of supporting herself and her family, neither an assignment nor a
transfer is being effected.
   8
    Plaintiffs concede that, "The representative payee is required to provide for the child's
immediate needs, which the parties agree she does by providing a portion of the monthly Social
Security income to the household. The lump sum (i.e., the resource in question), is invested in
anticipation of [the child's] future education needs."
   9
     Both the retroactive benefits and the monthly income derive from OASDI. The fact that the
retroactive benefits were received in a large lump sum does not in any meaningful respect
distinguish them from the monthly income. If the representative payee fears that release of the
lump sum will result in its being squandered, the representative payee might release the funds in
monthly installments sufficient to prevent plaintiffs from requiring welfare assistance.
       As desirable as it may be for this child to have a trust fund which she might use for various

purposes when she attains majority, we cannot agree that she may maintain that trust fund while her

family languishes in poverty and is supported wholly or in part by the public purse. We hold that the

child's assets are "deemable" for the purposes of determining her family's eligibility for AFDC and

food stamps. If the representative payee will not release the funds necessary to make up the loss of

the AFDC benefits and food stamps, plaintiffs are not left without a remedy. They may challenge the

appointment of this particular representative payee (or seek her removal) under 42 U.S.C. §§

405(j)(2)(E)(i) and 405(j)(2)(E)(ii), or they may sue the representative payee.

       AFFIRMED.