holding recovery of SNAP overpayments is mandatory, regardless of fault
How later courts described this case
- holding recovery of SNAP overpayments is mandatory, regardless of fault
Written by the judges who cited it.
The opinion
RECORD IMPOUNDED
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2773-23
S.M.,1
Petitioner-Appellant,
v.
DEPARTMENT OF HUMAN
SERVICES, DIVISION OF
FAMILY DEVELOPMENT,
Respondent-Respondent,
and
OCEAN COUNTY BOARD OF
SOCIAL SERVICES,
Respondent.
_____________________________
Submitted April 20, 2026 – Decided May 22, 2026
Before Judges Sabatino and Walcott-Henderson.
On appeal from the New Jersey Department of Human
Services, Division of Family Development, Docket No.
C092417015.
1
We use initials to protect the petitioner's privacy interests. R. 1:38-3(f)(4).
S.M., self-represented appellant.
Jennifer Davenport, Attorney General, attorney for
respondent (Sookie Bae-Park, Assistant Attorney
General, of counsel; Laura N. Morson, Deputy
Attorney General, on the brief).
PER CURIAM
Petitioner S.M., a self-represented litigant, appeals from a final agency
decision of the Department of Human Services, Division of Family
Development ("DFD"), adopting the initial decision of Administrative Law
Judge ("ALJ") Dean J. Buono, finding S.M. received an overpayment of
Supplemental Nutrition Assistance Program ("SNAP") benefits in the amount of
$24,264.2 S.M. challenges DFD's determination, alleging various constitutional
due process and substantive flaws in the hearing before the ALJ and the Board's
reliance on the ALJ's initial determination. Discerning no abuse of discretion
or legal error by the Board, whose decision is supported by amply evidence in
the record, we affirm.
2
The Supplemental Nutrition Assistance Program was established by Congress
in 1964, "to safeguard the health and well-being of the Nation's population by
raising levels of nutrition among low-income households." 7 U.S.C. § 2011;
N.J.A.C. 10:87-1.1. SNAP benefit eligibility is limited to households "whose
incomes and other financial resources, held singly or in joint ownership, are
determined to be a substantial limiting factor in permitting them to obtain a more
nutritious diet." 7 U.S.C. § 2014(a).
A-2773-23
2
I.
The following relevant facts are largely undisputed. This matter stems
from the Ocean County Board of Social Services' ("OCBSS") determination that
petitioner received an overpayment of SNAP benefits in the amount of $24,264.
Petitioner first applied and was approved for SNAP benefits in May 2017,
requiring her to complete financial information about her household income .
Petitioner resides in the same household with her husband, S.L., and is a
recipient of monthly benefits from the Department of Veterans Affairs ("VA").
S.M. submitted applications for SNAP benefits annually, which required her to
update her household income and, relevant to these proceedings, between March
2017 and March 2019, S.M. reported S.L.'s VA benefits at $1,635 per month.3
According to the DFD, S.M. continued to report that income until May
2020 when she claimed that S.L.'s benefits had increased to $1,728. Three
months later, however, S.M. reported that S.L.'s income had in fact decreased to
$1,644, approximately ten dollars more than it was in March 2019.
Following S.M.'s revision of S.L.'s income, OCBSS initiated an
investigation into the couples' household income, and discovered S.L.'s
3
S.L. is not a named party in this action. However, as a household member,
his income is at issue here. S.L. also testified in the hearing before the OCBSS.
A-2773-23
3
undisclosed United States Automobile Association ("USAA") account, which
was held solely in his name, and showing annual deposits of income in excess
of $40,000 each from 2017 through 2020, when the parties were also receiving
SNAP benefits. More particularly, OCBSS ultimately determined that S.M.'s
household received "undisclosed VA deposits as follows: $40,371.34 in 2017;
$41,139.07 in 2018; $42,317.83 in 2019; and $42,984.46 in 2020." These
reports reflect income that made the household ineligible for SNAP benefits.
When DFD advised S.M. that she would be required to reimburse them
for the overpaid benefits and the amount owed, S.M. requested a hearing to
contest the determination and amount of the claimed overpayment. 4 The matter
was transmitted to the Office of Administrative Law ("OAL") as a contested
hearing, pursuant to Administrative Procedure Act ("APA"), N.J.S.A 52:14B-1
to -15.
The matter was assigned to ALJ Buono and initially scheduled for a
telephonic hearing on September 15, 2023, at which time S.M. requested an
adjournment, seeking additional time to obtain allegedly undisclosed
documents. The hearing eventually commenced on January 3, 2024 with all
4
The OCBSS issued a notice to appellant on April 15, 2023, informing her of
her obligation to repay the inadvertent household error overissuance of $24,264
of SNAP benefits.
A-2773-23
4
parties appearing in-person. S.M. presented the testimony of S.L. and noted that
she would be relying on his testimony. S.L.'s testimony consisted of complaints
regarding the Board's proceed and investigation, claiming due process and
Fourth Amendment violations, OCBSS's investigators conspired to withhold
information from them, and provided invalid subpoenas to obtain their personal
banking information that they were not entitled to in violation of federal and
state law.
DFD presented Renee Savage as its sole witness, who testified that
although S.M. submitted an August 2020 Fulton Bank statement reflecting a
$1,727.21 VA deposit, OCBSS subpoenaed additional financial records
revealing no such deposit.
Nearing the conclusion of the trial, S.M. through S.L., asked the ALJ to
subpoena multiple OCBSS employees to question them about their
investigation. The ALJ, however, denied their request and concluded the matter
on that day.
The ALJ issued a comprehensive written decision, summarizing the
testimony of the witnesses, setting forth the applicable law and engaging in a
thorough and compelling legal analysis. The ALJ began by explaining the
categories of overpayment claims against household members, noting that
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County Welfare Agencies "must collect overpayments, regardless of who is at
fault," whether the overpayment arises from: (1) an intentional program
violation claim; (2) an inadvertent household error claim; or (3) an agency error
claim. The ALJ next discussed the laudable goals of the SNAP program, noting
that SNAP was designed to promote the general welfare and to safeguard the
health and well-being of the population by raising the levels of nutrition among
low-income households pursuant to N.J.A.C. 10:87-1.1.
The ALJ further noted that the amount of SNAP benefits a household
receives is "based upon the number of people in the household and the
household's countable income," which is defined as "'all income from whatever
source unless such income is specifically excluded." The ALJ next determined
S.L.'s VA benefits do not qualify as excludable income under N.J.A.C. 10: 87-
5.3, and further S.M. did not advance this argument.5
The ALJ concluded "the petitioners' earned income due to S.L.'s [VA]
benefits and S.M.'s income" were not correctly reported to the Board, "OCBSS
was thus unable to accurately compute the SNAP benefits . . . awarded benefits
5
Referring to the categories of income excluded from SNAP eligibility
calculations under N.J.A.C. 10:87-5.3, the ALJ found that VA benefits are not
among the enumerated exclusions, and therefore, constituted countable
household income for purposes of determining SNAP eligibility and any
resulting overpayment.
A-2773-23
6
when the household was ineligible." The ALJ rejected all claims of procedural
and code violations, emphasizing most significantly that "neither S.L. nor S.M.
ever addressed the amount of overissuance or whether there was an actual
overissuance at all," and instead "simply addressed nonexistent procedural
issues, federal codes including the [Uniform Commercial Code], as well as case
law that is inapplicable." The ALJ concluded that the statutory mandate to
recoup overpayments, even when the recipient is not at fault, includes the ability
to obtain bank records, thus, petitioners are "obligated to repay $24,264, the full
amount of the SNAP overpayment. The parties filed exceptions, which were
reviewed by the DFD's Commissioner, although S.M. now argues on appeal that
the procedures surrounding the filing and consideration of those exceptions
deprived her of a full opportunity to be heard.
The Commissioner concurred with the ALJ's initial decision,
characterizing it as "thorough and comprehensive" for providing a detailed
factual timeline, "outlining the applicable law, and then applying the law to [the]
fact[s]." The Commissioner further emphasized S.L.'s testimony before the
ALJ, noting his failure "to address the amount of overissuance or whether an
overissuance had occurred at all." S.M. appealed.
A-2773-23
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II.
Our review of an administrative agency's decision is limited. We will
disturb the agency's decision only if it is "arbitrary, capricious or unreasonable,"
or is unsupported "by substantial credible evidence in the record as a whole." In
re Stallworth, 208 N.J. 182, 194 (2011). We further recognize the Commissioner
has "complete discretion" to determine an inmate's placement and custody
status. Smith v. N.J. Dep't of Corr., 346 N.J. Super. 24, 29 (App. Div. 2001)
(citing N.J.S.A. 30:4-91.2). Nonetheless, we will find an abuse of discretion
"when a decision is 'made without a rational explanation, inexplicably departed
from established policies, or rested on an impermissible basis.'" Flagg v. Essex
Cnty. Prosecutor, 171 N.J. 561, 571 (2002) (quoting Achacoso-Sanchez v.
Immigration & Naturalization Serv., 779 F.2d 1260, 1265 (7th Cir. 1985)). "[I]t
is a fundamental of fair play that an administrative judgment express a reasoned
conclusion . . . [which] requires evidence to support it and findings of
appropriate definiteness to express it." N.J. Bell Tel. Co. v. Commc'ns Workers
of Am., 5 N.J. 354, 375 (1950) (internal citation omitted).
As a threshold matter, New Jersey counties are responsible for certifying
eligible households and administering SNAP benefits; however, the State "is
ultimately responsible for ensuring that program operations conform with
A-2773-23
8
Federal laws and [United States Department of Agriculture] regulations."
N.J.A.C. 10:87-1.2. In accordance with this mandate, the Commissioner of the
Department of Human Services has adopted comprehensive rules and
regulations governing financial eligibility, pursuant to N.J.S.A. 44:10-85 and
the APA. N.J.S.A 52:14B-1 to -31; N.J.A.C. 10:87-5.1 to -5.11.
To determine a household's eligibility for SNAP benefits, an applicant
must cooperate with the county, which includes verifying the household's "gross
nonexempt income." N.J.A.C. 10:87-2.14. Gross nonexempt income refers to
"all income from whatever source unless such income is specifically
excluded[.]" N.J.A.C. 10:87-5.3; N.J.A.C. 10:87-5.8. Relevant here, VA
benefits are not specifically excluded from household income under N.J.A.C.
10:87-5.9.
In addition, beneficiaries must report "all income currently being received
by all members of the household and any income changes or additions which the
household anticipates" at the time of certification or recertification. N.J.A.C.
10:87-5.2; N.J.A.C. 10:87-5.9. All applications and recertification forms must
contain "understandable terms that benefits will be subject to verification by
Federal, State and local officials to determine that the information is factual and
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9
that incorrect information can lead to . . . civil and criminal penalties." N.J.A.C.
10:87-2.13(a). (emphasis added).
It is also well-settled that when SNAP benefits are overpaid, counties are
obligated to seek repayment. N.J.A.C. 10:87-11.20. There are three types of
claims against households when benefits are overpaid: (1) an intentional
program violation claim; (2) an inadvertent household error claim; and (3) an
agency error claim. N.J.A.C. 10:87-11.20(e); 7 C.F.R. § 273.18(b). The county
is required to recoup the overissuance, regardless of the cause. Ibid. Counties
therefore have "no discretion whatsoever with regard to seeking recovery of
overpayments of public assistance funds or over[]issuances" and "states are
subject to severe sanctions, not merely state reduction of participation in the
program, but state liability for the overissuance[], should a state fail to recover
or make good faith efforts to recover." Childs v. Essex County Div. of Welfare,
236 N.J. Super. 127, 141 (App. Div. 1988) (holding recovery of SNAP
overpayments is mandatory, regardless of fault) (citing 7 C.F.R. §§ 275, 276).
When an overissuance is discovered, the county board of social services
and/or DFD is required to provide the household with written notification of the
claim before they "begin collection action on any claim." 7 C.F.R. § 273.18(3).
Unless the amount of the claim is established at a fair hearing, the agency must
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notify the household that they are entitled to request a fair hearing on the
decision related to the claim and that they have ninety days to request a fair
hearing. 7 C.F.R. § 273.18(3)(iv)(I). The written notice must also include "a
time frame to either repay or make arrangements to repay the claim." 7 C.F.R.
§ 273.18(3)(iv)(N).
Before us, S.M. argues that the final agency decision must be vacated and
the matter remanded because the DFD failed to respond to her petition for a time
extension to file an exception, thereby depriving them of the opportunity to be
heard. We reject S.M.'s alleged procedural deficiencies in the proceedings. On
the contrary, we are satisfied that S.M. was afforded proper notice of the claims
against her and granted a hearing before an ALJ consistent with N.J.A.C. 10:87-
8.6 and 7 C.F.R. § 273.15, which govern fair hearing procedures in SNAP
overpayment matters. Under these circumstances, we discern no merit to S.M.'s
constitutional challenges and affirm the DFD's final agency decision
substantially for the reasons stated in the ALJ's comprehensive initial dec ision
adopted by the DFD.
We further reject S.M.'s claims the ALJ erred by failing to grant her
additional time to file exceptions, concluding instead that nothing precluded
S.M. from filing exceptions between January 19, 2024, (the date of the petition
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for a time extension), and March 28, 2024, (the date of the final agency
decision).
Also, critical to our conclusion is that neither S.M. nor S.L. ever disputed
the actual overpayment of SNAP benefits, or the specific amount of the
overpayment sought by the county, as noted by the ALJ and adopted by the DFD.
It therefore stands to reason that despite any alleged procedural deficiencies,
S.M. accepted DFD's contention that she and her household were the recipients
of SNAP benefits to which they were not entitled and the law compelled them
to make reimbursement to the county. See Childs, 236 N.J. Super. at 141.
Accordingly, DFD properly entered the putative order against S.M. and ordered
reimbursement of $24,264. S.M.'s argument that the subpoena used to obtain
S.L.'s bank records was illegal because it violated the RFPA is meritless because
the RFPA only applies to administrative subpoenas issued by federal
government agencies. See 12 U.S.C. § 3401(3) (defining "government
authority" as "any agency or department of the United States, or any officer,
employee, or agent thereof[.]); 12 U.S.C. § 3405 (discussing the circumstances
under which a "government authority" may obtain financial records pursuant to
an administrative subpoena or summons). Thus, S.M.’s assertion that she or her
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husband were entitled to notice of the DFD’s subpoena under the RFPA is
legally incorrect.
To the extent we have not specifically addressed any of S.M.'s remaining
arguments, we conclude they lack sufficient merit to warrant discussion in a
written opinion. R. 2:11-3(e)(1)(E). Nothing in this opinion precludes S.M. and
the DFD from working out a plan for repayment in installments. The existing
stay of the final agency decision shall expire on June 8, 2026, unless it is
extended further by the Supreme Court on application.
Affirmed.
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