# Appendix — Rosado v. Wyman > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385001_1311%3A3 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 1969 - **Citation:** 395 U.S. 826 ## Text J oot Shaka Re ns hh BAe wae 2s ' oh % ~ “ fea = Bnet | ; ‘ Office-Supreme ‘Court, U, wPREMe COURT. UB 8 = - _. FILED SUN 17 1965 IN THE Supreme Cour of the United Staff § DAS, cent : - OCTOBER TERM, _— i ; - as 1 5 3 3981540 - JuLIA Rosado, Ya: Hiernanpez, Masorm Mitey, Sopuia Aprom, RUBY | ER Mae Kina, CATHRYN FoLg, Annie Lov ° ividually, on behalf of their minor chil: dren, and on behalf of all other persons rly situated, fis Petitioners-Appellants, —vegainst— ie as Grorer K. Wrens individually and in his capacity as Comitissioner of Social Services for the State of New York, and the Di DEPARTMENT OF ee SERVICES FOR THE STATE or New. YORK, —— se aera Respondents-Appellees. ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE : EASTERN DISTRICT OF NEW YORK * _ APPENDIX TO PETITION FOR CERTIORARI, MOTION TO EXPEDITE AND JURISDICTIONAL STATEMENT Cant Ronin | ' Leg A. ALBERT JAMEs SPITZER aa 7 * Center on Social Welfare Davip DRASCHLER - We and Law ma Scholarship, Education and 401 West 117 Street Defense Fund, Inc. New York, New York 10027 164 Madison Avenue . 280-4112 - New York, New York 10016 Henry A, FREEDMAN ' SYLvia ANN Law . Berr. NEUBORNE = Rosert P. Borsopy © _ New York Civil Liberties Union. - Of Counsel 156 Fifth Avenue | ; See : New York, New York 10010. ‘Martin Garsus : _ Roger Baldwin Foundation of the : _ American Civil Liberties Union ‘“ “aoe ' 156 Fifth Avenue . : “i New pests New York 10012 ; > . . 7. Lat INDEX TO APPENDIX PAGE ‘APPENDIX: A. _ Stein, District Judge, dated April 23° 1969 Deny- Memorandum and Order of —— Jack B. Wein- ing Defendants’ Motion to Join HEW as a Nec- | + . essary Party Defendant ‘ave la. > Memorandum anit thea of Hon. Jack B. Wein- stein, District Judge, dated April 24, 1969 -Con- _ vening a Three-Judge Court and Issuing a Tem- porary Restraining Order . 4a Memorandum and Order of Three-Judge District Court dated May 12, 1969 Dissolving Itself ....’......... 10a Opinion in Support of the issuance of a Prelimi- nary Injunction of Hon. Jack B.. Weinstein, Dis- trict Judge, dated May 15, 1969 .............. 1 14a Order of Hon. Jack B. Weinstein, District Judge, dated May 16, 1969 ; | 64a Order of United States Court of Appeals for the Second Circuit, of June 11, 1969 Staying the In- junction siccindesiendeieai inebdesaienachieaimniaipeie 66a APPENDICES A ‘ | la °° * APPENDIX A Memorandum and Order of Hon. es. Weinstein, District Judge, dated “April 23, 1969 Denying Defendants’ Motion to Join HEW as a Necessary Party Defendant This i is a class action brought by ton recipients ‘of welfare assistance under the Aid to Families With Dependent Children Program (AFDC) to declare invalid and enjoin the implementation of the recently:enacted amendment to — New York’s Social Services Law which allegedly cuts sub- stantially the level of welfare payments throughout the state as of July 1, 1969. N. Y. Soe. Serv. §131-a added by Laws Ch. 184, March 31, 1969. The defendants -have moved pursuant to Rule 19 of the Federal Rules of Civil Procedure to join the Department of Health, Education and Welfare (H.E.W.).as a necessary and indispensable party. For the reasons stated below, the motion is denied. A necessary siti is defined by Rule 19(a) as: A person ... (1) in [whose] : . . absence complete relief cannot be accorded among those already parties, ~ - or (2) [who] . .. claim[s] an interest relating to the ‘subject of the action and is so situated that the dis- position of the action in his absence may (i) as a prac- tical matter impair or impede his ability to protect that interest or (ii). leave any of the persons already parties subject to a substantial risk of incurring doubt,. multiple, or otherwise inconsistent obligations by rea- son of his claimed interest. H.E.W. does not fall within clause (1) of Rule 19(a). This Court would not “be obliged to grant partial or ‘hollow’ ence ee Silents geese aia tig CRP Tia inte aS ali Sani bh Eg 60 BA TED ctw 0 te EE ne ee -, / 2a rather than complete’ relief to the parties before” it.in the -’ absence of H.E.W. Advisory Committee Notes to Rule 19. Plaintiffs are seeking to invalidate section 13l-a so that the present welfare law will remain in effect; they do not seek to cut-off federal funds. Such a remedy is an appro- priate one and can be granted in the absence of H.E.W. See, e.g., King v. Smith, 392 U.S. 309 (1968); Westberry v. Fisher, 37 U.S.L.Week 2573 (D. Me. 1969); Williams. v. Danridge, —— F. Supp. —— (D. Md. 1969) ; cf. Note, Fed- eral Judicial Review of State Welfare Practices, 67 Colum. | L. Rev. 84, 117 (1967). H.ELW. has not been a party in the recent challenges to-staté welfare laws. See, e.g., Sha- piro v. Thompson, —— U.S. ——, 37 U.S.L.Week 4333 (1969) ; King v. Smith, 392 U.S. 309 (1968); Westberry v. Fisher, 37 U.S.L.Week 2573 (D..Mé. 1969); Williams v. Danridge, —— F. Supp. —— (D. Md. 1969). Although a state has the option of withdrawing from the AFDC pro- gram, it cannot be said t6 have exercised the option by the passage of a statute inconsistent with federal law in the absence of an express statement of withdrawal by the state legislature. See, e.g., King v. Smith, 392 U.S. 309 (1968). ' To require plaintiffs to proceed against H.E.W. would put them in the untenable position of being forced to seek a cut-off of all welfare payments in order to challenge a law on the ground that it provides for inadequate payments. Such a rule would only serve to insulate -state welfare laws from judicial review by deterring potential — from challenging them in the courts. H.E.W. does not fall within clause (2) of Rule 19(a). While it does have an arguable interest in the subject * matter of this litigation since it is required to review each state plan to determine whether the _ complies with fou - se sii eae ere Snatch 3a federal standards, H.E.W.’s absence wiil not, “as a prac-. tical matter,” impair its ability to protect that interest or expose any of the existing parties to double or inconsistent liability... H.E.W. has strenuously opposed the motion to join it as a party. Its interests can be adequately protected, and its position made known to the Court, by the filing of an amicus brief. See Lampton v. Bonin, Civ. No. 68-2092, See. ~ E (E.D. La., complaint filed November 14, 1968) (H.E.W. requested to file amicus brief); Jefferson v. Hackney, CA-3012-B (N.D. Tex., complaint filed February 12, 1969) (same). Any negotiations H.E.W. is currently conducting with New York State can continue while this action is progressing. : . Defendants’ motion to join H.E.W. as a necessary and 7 indispensable party is denied. | : | aA ; So ordered. | Dated: Brooklyn, New York April 23, 1969 Jack B. WEINsrTEIn . U.S.D.J. ' de APPENDIX B Memorandum and Order of Hon. Jack B. Weinstein, District Judge,.dated April 24, 1969 Convening a . Three-Judge Court and Issuing a Temporary | Restraining Order This is a ” ae pare to‘ declare invalid section 131-a of the New/York Social Services Law, effective July 1st of this year, fixing maximum benefits for certain classes of - welfare recipients in the state. Plaintiffs, residents of Nassau County and the City of New York who are pres- ently receiving welfare benefits which will be substantially reduced under the new law, have moved for a temporary restraining order. Defendants have moved for the can- © vening of a three-judge court. For the reasons stated below, both motions are granted. | Plaintiffs allege that the New York statute violates the Equal Protection Clause of the Fourteenth Amendment of the United States Constitution and the Social Security Act of 1935, as amended, and the regulations of the United States Department of Health, Education and Welfare, con- ditioning receipt of federal aid and its use by the states in their welfare programs. In brief, it is the contention of plaintiffs that federal law requires New York State, if it is to participate in the federal welfare reimbursement program, to take into account increases in the cost of living in computing new benefit levels; that the new state statute violates federal standards by arbitrarily decreasing the sums permitted to be paid to welfare recipients and by arbitrarily discriminating against Nassau County residents in reducing their payments substantially below those avail- able ‘to New York City residents without any basis in cost- ‘ eee 5a of-living differentials ; and that the new state law, if it becomes operative, will cause severe and irreparable sais to plaintiffs and their infant charges. ’ At this preliminary stage of the litigation it is important to note that plaintiffs are not contending that federal law or regulations require the states to provide any welfare _benefits. The power of the legislature to determine how the state’s resources should be allocated through the levy- ing of taxes and the appropriations of state monies is-not | being: challenged. Rather, it. is plaintiffs’ position that’ when a state chooses ‘to participate in the federal welfare program and receives federal appropriations, it must com- ply with valid federal conditions. | | _ We first address ourselves to the question of a three- judge court. The way the issues have been framed by the parties, they can he broken down into two questions: first, whether a three-judge court is required to hear plaintiffs’ equal protection*claim and, second, if a three-judge court would be required, whether it should be convened now or whether a single judge- should first decide the ne cost-of-living claim. A three-judge court is necessary to heap plaintiffs’ equal protection argument. It is clear that it raises a substantial federal question. The Supreme. Court’s opinion in Shapiro v. Thompson, —— U.S. , 37.U.S.L.W. 4333 (1969), de- . cided this past Monday, establishes that the Equal Protec- tion Clause has wide application in the welfare area and suggests that the purpose of conserving funds may not, in and of itself, support grossly dissimilar treatment between similarly situated individuals. Plaintiffs allege that the classification of New y York City residents separate and apart from non-City residents— particularly those in Nassau County—is ‘an invidious dis- a ene . pts fd 5 Se ee ee ee . a Oty Sy 6a crimination. It is contended that the distinction is not based on need since the cost-of-living for welfare recipients in Nassau ‘County is equal to, or higher than, that in New © York City. Under the present law Nassau County~ is grouped with New York City in determining the schedule of payments. Under the proposed law it is grouped with counties outside the City; as a result, welfare payments will be substantially lower than those for New York City residents. The differences are, it is argued, so far out- of-line with cost-of-living differences between the City and County as to constitute an irrational, invidious and uncon- stitutional discrimination. We cannot, on the record before us, say that this claim is frivolous. The two arguments that plaintiffs present against con- vening a three-judge court on this issue are not persuasive. The fact that they are seeking a declaratory judgment rather than injunctive relief, in the circumstances of this case, is merely a semantical, not a practical, difference. A declaratory judgment would have an effeet identical to an injunction. In their complaint plaintiffs ask for “such other relief” as is appropriate and ‘the Court will have the power to grant an injunction. That one may be required is suggested by the fact that plaintiffs are now secking a temporary restraining order. The contention of plaintiffs that, so far as Nassau resi- ‘dents ‘are concerned, a statewide statute is not. under at- tack, is without merit. Challenged is the state’s entire plan for setting levels of welfare payments. Plaintiffs’ attack, -if fully successful, may have an effect on welfare recipients in every county in the state. _ The second question is whether this Court should refrain from convening a three-judge court until it decides the a 7a statutory cost-of-living issue. Plaintiffs’ argument that _ this is a separate and independent claim and that the statu- tory issue should be decided first, in an attempt to avoid reaching the constitutional issue, is normally persuasive. In this case, however, all parties agree that time is of the essence. Were the Court to decide the statutory claim first — and decide it against plaintiffs, a three-judge court would then need to be convened. The delay a ' costly to all concerned. A three-judge court appears to be the appropriate vehicle for speedily resolving all the issues in this case so that uncertainty may be eliminated as soon as possible. A direct appeal to the Supreme Court would lie from a three-judge determination. That Court can move quite expeditiously _ in matters of this sort, particularly with regard to a stay. Should it subsequently be determined that a three-judge court was not required, the single judge’s decision, as part of that three-judge court, would become the opinion of the Court. : We turn now to the pene of whether a temporary : ~ restraining order should be granted anieetad - convening of a three-judge court. : Extensive briefing, argument, affidavits of the individual plaintiffs, and experts’ testimony in Court requires a find- ing at this preliminary stage of the litigation that plaintiffs have a substantial probability of establishing the validity of their claims and the right to the remedies they seek, both provisionally’ and permanently. These findings, it should be emphasized, are not findings on the merits of the action. Both sides have indicated that prejudice will result should section 13l-a be declared invalid after administra- © SEER Ee ps > nae me eee ~~~ «tive action has been taken which would. prevent the state from keeping the present system in effect on July 1st. Plaintiffs’ testimony supports a. provisional finding that the new statute will cause welfare recipients to lose funds required to keep them at the level of bare subsistence. The | state’s witness testified that, on the one hand, many recipi- ents will receive higher payments under the new system and, ‘should the state commence payments under section -131-a, the state will not be able to obtain reimbursement if the section is struck down. On the other hand, he stated, it will reimburse ee whose payments were illegally re- duced. The sums involved are large. It is estimated that pay- ments under the new system will—be approximately $10,000,000. a month less than under the old. And in some cases reductions to welfare recipients run in the order of 20%. Thus, both the state and many welfare recipients may be irreparably harmed if payments made under the new statute are ultimately determined to be illegal. Witnesses for both sides indicated, that it would take between six to eight weeks to change from one system to the other. The state’s testimony indicated that it was possible to prepare for the new system under section ~131-a while being able to remain in a position to continue the present system should that be required. This could be ~- done, state experts believe, by presérving the present elec- tronic data processing tapes (or by making: a copy of them), while making new tapes in planning for the new system. Since the plaintiffs’ witness indicated that the City intends to proceed by modifying the present tapes, it is important that the state take steps for their dipuabi a- tion. ACRES PR LATE aR a lA GRE NTE PODS Bi ci INDIE 0 0204 8S Gn mst REET deh ane ee Sat 9a Accordingly, the Court is signing and filing a temporary restraining order today and is writing to the Chief, delay its passage. See New York State Constitution, Art, 3 ~’ _§14. The Governor signed the bill on- May 9, 1969 and, according to its terms, it takes effect on July 1, 1969, as did the original subdivision 4. Pursuant to this new subdivision 4, the Commissioner of Social Services of the State of New York may—either on his own motion or after an application by a local Social Services ‘Officer with the consent of the local legislative - body or upon the petition of an aggrieved party, pursuant to Article 78 of the New Yerk Civil Practice Law and Rules—provide schedules for monthly payments in all parts of the state which reflect differences in cost of living. Under the circumstances it is apparent that the consti- tutional issue posed is .no longer justiciable. The constitu- tional attack on the provision as originally adopted has heen rendered moot and any attack on the newly adopted ~ subdivision would ‘not be ripe’ for adjudication by this Court: until there has been an opportunity for action by | - state officials and until the matter comes before: this Court in an appropriate proceeding. We need. not consider the | now academic question of whether the three-judge court might, in the exercise of its pendent jurisdiction, have de- cided the alleged statutory issue either before it considered | the alleged constitutional issue or after it decided the ae constitutional issue against the plaintiffs. Cf. King v. | Smith, 392 U.S. 309, 312, n. 3 (1968). Under the circum- -. stances of this case there i is no reason for continuing the - three-judge court. | It is ordered that the three-judge court. heretofore con- vened be and is dissolved-and that the matter be and is’ remanded to the single judge to whom the complaint was « ‘ 188 originally presented for such further proceedings as are, _ appropriate. See Peterson v. Clark, 285 F. Supp. 698, 700 (N.D. Calif. 1968}; cf. International Ladies’ G. W. B+ Donnelly. Garment Co., 304 U.S. 2438 (1938). So ordered. Dated: Brooklyn, New York 7 12, 1969 /s/ LEOWARD P. Moors 5 ae ' Leonard P. Moore, Judge, - United States Court of Appeals . . /s/ JacoB Misuse Co a ( e ~ Jacob Mishler, Judge, United States District Court, Eastern District of New York. /s/ Jack B. WEtNstEIn ! Jack B. Weinstein, Judge, , United States District Court, ° _. « Eastern District of New York . ‘ 14a _ APPENDIX. D Opinion in Support of the Issuance of a Preliminary Injunction of Hon. Jack B. Weinstein, District Judge, Dated May 15, 1969 Plaintiffs allege that section 131-a of the New York Social Services Law, effective July 1st of this year (ch. 184, L. 1969) is void because it conflicts with section 402(a) (23) of the Social Security Act of 1935, as amended in 1968, providing Federal Aid to Families with Dependent Chil- dren (AFDC). See 42 U.S.C. $§ 601, 602; 45 C.F-R. § 233.20 (a) (2) (i); 34 Fed. Reg. 1394 (1966). Their contention ‘is that section 402(a)(23) requires New York State, if it is to participate in. the relevant: federal welfare reimburse- ment program, to take into account increases in the cost of living in computing new benefit lev els; that the new State statute violates federal standards ‘by decreasing ‘the sums to be paid to many welfare recipients and that the new state law, if -it becomes operative, will cause severe _ and irreparable harm to plaintiffs and their infant charges. Both plaintiffs and defendants have moved for summary judgment. In addition, plaintiffs have moved for a pre- liminary injunction to. enjoin the defendants from in- stituting changes pursuant to section 131-a until this litiga- tion can be decided on’ the merits. The test for granting summary judgment is whether there exists “any ‘genuine issue as to any material fact.’ F. R. Civ. P. 56(c); see, F. R. Civ. P. 56(e).” Waldron v. Cities Service Co.,861 F. 2d 671, 672 (2d Cir. 1966), aff'd sub nam. First National Bank of Arizona v. Cities Service Co., 391 U.S. 253 (1968). The test for granting a pre- liminary injunction is whether plaintiffs have made “a Sinem atheetie': GB a 15a clear showing of probable success and probable irreparable injury.” Clairol Incorporated v. Gillette Company, 389 F. 2d 264, 265 (2d Cir. 1968). See F. R. Civ. P. 65. For the reasons stated below, it is clear that plaintiffs have a substantial claim with a high likelihood of prevail- _ ing on the merits and that they will probably suffer irrepar- - able damage unless a preliminary injunction is granted. Accordingly, such an injunction will issue. There are still a number of unresolved questions of fact; the statistical and other data underlying this dispute ane not yet been developed with clarity sufficient to warrant granting summary judgment: Pursuant to Rule 56(f) of the Rules of Civil Procedure this Court orders “a continu- ’ “ance to permit affidavits to be obtained or depositions to : be had” or testimony and exhibits to be presented. Because of the importance of this matter we assume that defendants will wish to take an immediate interlocutory | appeal pursuant to section 1292(a)(1) of title 28 of the United States Code from the order granting the preliminary injunction. In order to render as much assistance as possible to the Court of Appeals and to the parties, should an appeal be taken, we have set out below the posture of the case in more detail than is ordinarily warranted in disposing of preliminary applications. It should be em- phasized that the conclusions are tentative only, are made ‘only for the purpose of deciding the motions before us, and do not determine the merits of the case. oe eee I. JURISDICTION . Plaintiff's complaint challenges section’ 131-a on two main grounds: first, denial of.equal protection of the laws -because residents of Nassau County are discriminated ° against by payment schedules substantially below those for the City of New York; and, second, conflict with a federal . PPE Oe Pee? entry ee -_ —— anus ‘ = aa TT le Bats ee tye ee € ‘ eet 16a statute. A three-judge court was required to be convened - because plaintiffs’ equal protection claim raised a: sub- stantial federal constitutional question with respect to the applicability of a state-wide statute. 28 U.S.C. § 2281. See, e.g., King v. Smith, 392 U.S. 309, 312, n. 3 (1968); Florida Lime and Avocado Growers, Inc. v. Jacobsen, 362 U.S. 73 (1960) ; Kramer vy. Union Free School Dist. No. 15, . 379 F. 2d 491 (2d Cir. 1967). See also Shapiro v. Thomp- son, —— sha S. —— (1969); Westberry v. Fisher, —— F. Supp. » 37 U.S.L.W. 2573 (D. Me. 1969); Williams v. Dandridge, citar Pe Supp. —— (D. Md. 1969); Lampton v. Bonin, —— F. Supp. (i.D. La. 1969). After the three-judge court was convened the legisla- ture adopted an amendment to section 13l-a which ren- dered the equal protection claim moot. Accordingly, the Court dissolved itself and remanded the case “to the single judge to whom the complaint was originally presented for such further proceedings as are appropriate.” Rosado v: | 1.D.N.Y. 1969). At the outset we must confront the question of our juris- . diction to. decide the federal statutory claim. Cf. King v. Smith, 392 U.S. 309, 312, n. 3 (1968). There are a number of independent bases for concluding that jurisdiction exists. | A: Pendent Jurisdiction Once its. jurisdiction has been properly invoked, a fed- eral district court acquires pendent jurisdiction to de- _ eide all related claims, including those involving federal and state statutory questions, arising out of the same trans- action or dispute. See, e.g., United Mine Workers v. Gibbs, 383 U:S7715 (1966) ; Hurn v. Oursler, 289 U.S. 238 (1933) ; Gulickson v. Forest, 290 F. Supp. 457, 464 (E.D. N.Y. 1968). The district court has power to decide the . pendent claim even if it does not reach the issue which pro- vided the basis for the court’s jurisdiction or even if it first 17a decides the jurisdiction-founding issue against the plain- tiffs. See, e.g., King v. Smith, 392 U.S. 309 (1968) ; United Mine Workers v. Gibbs, 383 U.S. 715 (1966) ; Siler v. Lows- ville € Nashville R. Co., 213 U.S. 175 (1909) ; Gulickson vy. Forest, 290 F. Supp. 457, 464 (E.D.N.Y. 1968). | In the present case, it is clear that at the time the three-judge court was convened jurisdiction existed pur- suant to section 1343(3) of title 28 and sections 1983 and 1988 of. title 28 of the United States Code. These provi- sions grant original jurisdiction to the federal district courts, without respect to the amount in controversy, over cases where it is claimed that a right under the United States Constitution is being violated. The three-judge court, in its per curiam opinion, noted that it. had been - “properly convened” (Rosado v. Wyman, F. Supp. »— (E.D.N.Y. 1969) ), thereby impliedly ruling that a substantial federal question had been raised. See, e.g., ; Swift & Co. v. Wickham, 382 U.S. 111, 115 (4965) (“no such court [three-judge court] is called for when the alleged con- stitutional claim is insubstantial”); Kramer v. Union Free School Dist. No. 15, 379 F. 2d 491 (2d Cir. 1967). There is no doubt that under the liberal test recently enunciated ‘by the Supreme Court in United: Mine Workers y. Gibbs, 383 .U.S. 715 (1966), the cause of action based on the Social Security Act would be considered pendent to the equal protection claim. - « The question posed is whether this Court has been - divested of pendent jurisdiction because the federal con- stitutional-claim was rendered moot after the three-judge court convened and heard argument on motions by all par- _ties for summary judgment. This question must be an- swered in the negative. Once pendent jurisdiction attaches, a federal court has the power to decide the entire case. Where the claim which I ECL PTE OR Fo Rae iD RM} Ss \ 18a t provided the basis. for its jurisdiction has been disposed of. prior to trial, however, courts have in the exercise of discretion, tended to voluntarily abstain from deciding pendent questions. See United Mine Workers vy. Gibbs, 383 U.S. 715, 726 (1966) (Certainly, if the federal claims aré dismissed before trial, even though not insubstantial in a jurisdictional sense, the state claims should be dismissed as. well”); Wham-O Mfg. Co. v. Paradise Mfg. Co., 327 F. 2d 748, 752-54 (9th Cir. 1964); Strachman v. Palmer, 177 F. 2d 427, 431 (1st Cir. 1949) (concurring opinion) ; Note, ~ The Evolution and Scope of the Doctrine of Pendent Juris- diction in the Federal Courts, 62: Colum. L. Rev. 1018, 1025 (1967) ; cf. Clairol Incorporated vy. Gillette Company, 389. F. 2d 264, 267-268 (2d Cir. 1969) (jurisdiction over unfair competition claim despite concession of lack of valid trade- mark registration); Rogers v. Valentine, 37 F.R.D. 231 (S.D.N.Y. 1964) (after summary judgment granted on fed- eral claim, jurisdiction retained over pendent non-federal © claim). The rationale for this doctrine of restraint in the exer- cise of pendent jurisdiction is that a federal court should seek to avoid “[nJeedless decisions of state law’: Needless decisions of state law should be avoided both as a matter of comity and to promote justice between the parties, by procuring for them a surer-footed read- ing of applicable law. United Mine Workers v. Gibbs, 363 U.S. 715, 726 (1966). See also Wham-O-Mfg. Co. v. Paradise Mfg. Co., 327 F. 2d 748, 753 (9th Cir. 1964); Strachman v. Palmer, 177 F. 2d . 427, 431, 433 (1st Cir. 1949) (concurring opinion). Accord- ~ingly, applying what has been referred to as “the intro- duction of evidence test,” some federal courts “hold that when a federal claim is dismissed on the pleadings, the 19a court should not retain a related nonfederal elaina absent an independent basis for federal jurisdiction.” Note, The. | Evolution and Scope of the Doctrine of Pendent Juris- diction in the Federal Courts, 62 Colum. L. Rev. 1018, 1025 (1962) (emphasis in original). _ Application of this rule would be slay inappropriate, wasteful of judicial energy and dangerous te the litigants in a case such as the one before us. The pendent claim does not involve-state law alone, but poses crucial and important questions of federal statutory law. It vitally affects a na- tional program designed to protect the fundamental rights. -of children to the sustenance and stable family life which will enable them to develop into full members of our society capable of exercising their rights and responsibilities under the United States Constitution and it involves the expendi- ture of billions of dollars of federal monies. The courts in the federal system are in at least as good_a position as state courts to adjudicate this question of federal law. Nor ean this be described as a petty or unimportant contro- versy of the kind Congress sought to exclude from the federal courts. We do not mean to suggest that the New York State courts would be more. likely to fall into error or to show hostility toward federal law than would a federal court. We are only now deciding whether it is appropriate for a federal eourt to divest itself of jurisdiction of a pénding case. | Factors to be taken into account in deciding this ques- tion include “judicial economy, convenience, and fairness to litigants.” ” United Mine Workers v. Gibbs, 383.U.8, 715, 726 (1966). These criteria provide justification for the doctrine of pendent jurisdiction generally; they compel retention of jurisdiction in the instant case. oe ) COAT CRE TO ROLY wre ate, . MURR ae, yt By RSI RENE Ree grenniNriep seus oi, 20a A speedy determination of this litigation is highly de- sirable. From the point of view of the plaintiffs, an un- necessary reduction of their benefits may reduce their in- come below subsistence level, causing grievous harm. From the state’s vantage point, an unnecessary extension of any temporary. restraining order preventing institution of the new reduced benefits would, according to the testimony of a Deputy Commissioner in the State Department of Social Services, result in a loss to the state of up to ten million dollars a month. Dismissal, under the abstention doctrine, would require plaintiffs to commence a new-suit in the state courts. Resulting loss of time would make it impos- sible to decide the issues before administrative arrange- ments must be made to implement the new state statute by its effective date—July 1, 1969. . Furthermore, the parties have already presented sub- stantial testimony, affidavits and briefs to the Court. The expenditure of time by the litigants and the Court would be, to a large extent, wasted were all these materials to be offered anew in a state court. Having found that pendent jurisdiction exists, we need - not reach the question whether administrative remedies must be exhausted in a suit challenging a state AFDC pro- - vision solely on statutory grounds. See King v. Smith, 392 U.S. 309, 312 n. 4 (1968) ; Rosado v. Wyman, —— F. Supp. (E.D.N.Y. 1969) (HEW not necessary party) ; cf. Note, Federal Judicial Review of State Welfare Practices, 67 Colum. L. Rev. 84, 91-92 (1967 ) (inadequacy of federal . administrative forum). B. Federal Question Jurisdiction Jurisdiction also rests on section 1331 of title 28 of the United States Code. This section grants the district courts jurisdiction over. all civil actions arising under “the Con- 2la stitution, laws, or treaties of the United States” provided that “the matter in controversy exceeds the sum or value ~ of $10,000.” There is no doubt.that the first requirement is met s since plaintiffs allege that the challenged state statute violates - section 402(a) (23) of the Social Security Act. Defendants —~ contend, however, that the ear inkiaee | does not involve -more than $10,000... The test for determining the amount in controversy relies heavily upon plaintiffs’ good faith and the certifica- tion of lawyers pursuant to Rule 11 of the Federal Rules of Civil Procedure that there is “ground to support” the - pleadings. It has been described 7, the Supreme Court as follows: The rule governing.dismissal for want of jurisdiction in cases brought in federal court is that, unless the - law gives-a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in © good faith. It must appear to.a legal certainty that the claim is. really for less than the jurisdictional amount to justify dismissal. St. Paul Mercury In- demnity Co. v. Red Cab Co., 303 U.S. 288, 288 (1938). See also Horten v. Liberty Mutual Ins. Co., 367 U.S. 348, “” 393 (1960). Where, as here, the plaintiffs in apparent good faith allege that more than $10,000 is in controversy, courts - are most reluctant to sustain a challenge to jurisdiction. See Wright, Federal Courts 94-95 (1963). In determining whether this test has been satisfied ‘in a class action of this kind, the claims of the individual plaintiffs or individual members, of the class may. not be aggregated. Snydgr v. Harris, U.S: , 37 U.S.L.W. 4262 (1969). Cohpare 1 Moore, Federal Practice { 0.91[1] at p. 827 (2f/ed. 1964) wath Wright, Federal Courts 100 22a (1963). Nevertheless, for purposes of jurisdiction in this case, each family may be considered as a unit an@the claims of each member of a Single AFDC family can.be combined because the federal statutory program relied upon by plain- ' tiffs is designed to protect the family as a. unit. If we only look to the impending reductions in welfare payments that any: family in the class may suffer, the monetary loss to each of the plaintiffs does not approach $10,000. Yearly welfare payments may not be multiplied ~ by a number of years in the future to make up the $10,000 requirement because it is too speculative to assume that any particular plaintiff will remain on welfare (or that . ' the program will remain unchanged. | While the direct damage to each member of the class. does not suffice, the indirect damage to each plaintiff and his charges may be very high. There is before this Court uncontradicted evidence, by testimony and affidavits, that members of the class are at or below a bare subsistence © level. Under such circumstances, a reduction in welfare benefits putting their income substantially’ below that. . threshold may threaten injuries to their children’s physical and mental development far greater than the mere mone- tary loss in benefits. Cf. Brown v. Board of Education, 347 U.S. 483, 494 (1954) (psychological. damage resulting from improper schooling). Deprivations during garly years may irreversibly retard mental and physical development and have an adverse impact on personality. Without intimating that the position of: these plaintiffs is at all comparable, the possibility of a serious injury resulting from a comparatively minor deprivation may be more clearly seen if we look at the situation of a Biafran child. A few cents a day is enough to prevent starvation or permanent maiming of such a child; several dollars a year might mean the difference between a healthy life and \ — stasis A ne didnt a Me ae 23a a stunted life or death. Certainly, to such a child, the ques- tion whether $10 in foodstuffs should be granted or with- held over a period of a year inv olves the monetary vem of a human life. ; We need not go outside the record in this case to con- sider general literature and Congressional hearings on the _ grave and permanent harm, particularly to the children in- volved, that might result from a reduction in welfare pay- ments. Typical of the material before this cant are some of the affidavits quoted below. A Professor of Pediatrics and ‘Attending Pivuclon ina ghetto hospital with “a great many patients who are. re- j cipients” of public assistance swears that many of them . : “have marginal nutritional status;” that “a decrease in the amount of assistance which these individuals receive for the purchase of food would create a deficiency in their diets and could lead to clinical. malnutrition ;” that “mal- _. nutrition tends to retard the physical and mental growth” of children and “may greatly diminish the ability of the individual to learn;” that this deficiency “will remain with ~e the individual for life;” that children born of “under- tieurished mothers” have a substantially increased tendency | to premature birth’ with “greater incidence of infant mor-_ tality ang an increased likelihood of mental and neuro- ‘logical damage ;” and that elimination of special diets and other assistance by reductions such as those proposed by the statute in question will cause damage “td individual recipients . . . so great as to be incalculable.” | A Senior Social Worker at a Medical Center swears that “at existing welfare levels most’ welfare recipients live in a state of constant anxiety, depression, frustration, and . _ physical suffering due to. the inadequacy of their welfare grants” and as a result of the proposed reductions the “suffering which will result ... will cause irreparable, and " incalculable, harm.” “-. 24a ’ A. Certified Social . _Worker with 28 years experience, employed by the Community Service Society of New York, Ine., swears that as a result of the reductions, “Serious unattended health problems will muliiply and proliferate, chitdren’s ability to achieve in school will be even further depleted, diets will beat a starvation level as families try to stretch their grossly inadequate budgets to meet their _ most-basic needs ... . ;” and that “Family life, already strained, will be . . ..severely jeopardized.” - The Chief of Budget Standard Service of the Community Council of Greater "New York swears that “deprivation [from the new proposed standard] will result in incal- culable hardship and misery to the “already severely de- prived families in our community,” A Dean of a School of Social Work swears that the pro- posed reduction will cause “great harm to. the physical, mental, emotional and moral health of these families.” A Pyofessor at a medical college and Director of a Neigh- ~ borh gd Health Center swears that “any diminution in inconge [of the families involved in this litigation] will worsen an already intolerable situation, resulting in ir- reparable damage.” . A Retired Medical Director of the United States Public Health Service serving as Deputy Director of Obstetrics. and Gynecology at a ghetto. hospital and Professor at a college of medicine swears. that “the possible harm afflicted upon pregnant mothers and newborn children is incaleu- lable.” In view of the relatively trivial injuries which result in recovery of more than $10,000 in this Court, it cannot be said that under no view of the facts is the amount in controversy less than $10,000 as to any member of the class. We do not, of course, in considering this jurisdictional 25a matter, pass upon, or express any view with respect: to, the accuracy of the affidavits quoted. C. Jurisdiction Under 28 U.S.C. § 1343(3) Plaintiffs also invoke section 1343(3) of title 28 of the United States Code as a basis for jurisdiction. This pro- vision grants the district courts original jurisdiction of any civil action, irrespective of the amount in controversy, to “redress the deprivation: under color of any State law ..., of any right privilege or immunity secured by . . . any Act of Congress providing for equal rights of citizens.” laintiffs assert that this section, when read with section 1983 of title 42, grants federal courts oa sdiction over controversies involving substantial individual rights pro- ‘tected by federal welfare statutes. Becausé jurisdiction to decide the statutory claim of invalidity is clearly founded both on section 1331 of titlé 28 and upon pendent jurisdic- tion arising from section 1343(3) of title 28, we need not _ and do not address ourselves to this position: Cf. King v. Smith, 392 U.S. 309, 312, n. 3 (1968). Compare Cover, Establishing Federal Jurisdiction in Actions Brought to Vindicate Statutory (Federal) Rights When No Viola- tions of Constitutional Rights Are Alleged, Clearinghouse Review, February-March, 1969 at p. 5;"Note, Federal Ju- dicial Review of State Welfare Practices, 67 Colum. L. Rev. 84, 112-14 (1967) with Note, The Proper Scope of the Civil Rights Acts, 66 Harv. L. Rey. 1285, 1291-93 (1953). Il. GeneraL NATURE OF FEDERAL-STATE PRoGRAM FOR Aw -Tto Famities With DEPENDENT CHILDREN . New York, together with every other state, participates in the AFDC program established by the Social Security a ee © ey re " s 26a Act of 1935. Section 401 of the Act provides that the fed- eral government shall make “payments to States which have submitted, and had approved by” the federal government “State plans for aid and services” to “needy children and the parents or relatives with whom they are living.” These federal payments are made on a matching fund: basis. Ad- ministration of the program is entirely in the hands of the _ States, although each state’s plan must meet the several requirements of the Social Security Act'and the rules and regulations promulgated by the United States Department _ of Health, Education and Welfare (HEW). 42 U.S.C. § 602. See King v. Smith, 392 U.S. 309 (1968). Each state participating in AFDC must formulate, in monetary amounts, a standard of need and provide a level of benefits based upon this standard. 45 C.F.R. § 233. 20 (a)(2)(i), 34 Fed. Reg. 1394 (1969). Phporationly, the standard of need is computed by adding the cost of all of the items deemed to be necessary for subsistence. Those whose incomes are below the standard of ‘need have a’ budgetary deficit consisting of the difference between their income and the standard of need, and they are eligible for welfare assistance. A state is free to determine the ae and their costs, to be included in its standard of need. In practice, it may not include all the necessary items or the prices used may not reflect true cost. That this is often the ease is evi- denced by affidavits and supporting memoranda submitted to the Court establishing that welfare budgets based on standard of need tend to be below the level which most studies indicate is necessary for normal daily ftnction- ing and healthy family life. _ Were a state paying 100% of its standard of need, the - amount of the welfare grant to a recipient with no income 27a would be equal to the standard of need. But, some states’ level of benefits are not determined solely by their own standard of need. Some states impose a flat maximum on the amount of the benefit—z.e., no family can receive a ' welfare grant of more than a stated number of dollars, | an amount which varies according to the size of the family —even if this sum does: not fully cover the budgetary deficit indicated by its own computation. Other states apparently pay only a fixed percentage of need—e.g., if the standard of need were $100 per month, the state would pay 80% of need and a person without other income would. _thus receive only $80 per month. Since “each State is free to set its own standard of need and to determine the level of benefits” (King v. Smith, 392 U.S. 309, 318-19 (1968) ), the sums paid by different states to comparable families under the AFDC program vary considerably. Thus, 29 states pay 100% of what they de- fine as standard of need, while Mississippi pays only 27% of its standard of need. The average monthly AFDC pay- . ment per recipient ranges from a high of $71.75 in New York to a low of $8.50 in Mississippi, as of June, 1968. IIl. New Yorx’s Current ProcramM Up to now New York’s levels of benefits have purportedly been designed to fully make up budgetary deficits as de- fined by its standard of need. The New York Department of Social Services is authorized to establish grant levels “in accordance with standards of public health in the com- munity with due regard for variations in cost from time to time and between localities.” N.Y. Soc. Serv. §131(3). Pursuant to section 131 of the New York Social Services Law, the Regulations of the Department of Social Services establish the “budgetary method” of computing the stand- ‘ ee | ery te ¥ Cer ee eis “meena TRE HURRY RT romps . hak aie ee Da De oa SOP EVE Be tle earerneye moe [ee ee aa > 28a ard of need and levels of payments. 18 N.Y.C.R.R. § 353.1. “[AJll items of basic maintenance and all items of special need required by [individual] case circumstances” com- prise the recipient’s “estimate of regularly recurring need” and are to be included in the welfare budget: 18 N.Y.C.R.R. § 353.1(d). The “recurring cash grant [is] ... the full budget deficit,”—that is, the excess of “the exthionte of reg- ularly recurring need” over the recipient’s “available re- sources” 18 N.Y.C.R.R. §§ 353.1(a), (d) ; 353.3(a). The test - by which it is determined which persons or families are eligible for welfare benefits, is defined as follows: _ An individual or family shall be deemed “in need” when a budget deficit exists or when the budget surplus is inadequate to meet one or more non-budgeted special needs required by the case circumstances and in- | cluded in the standards of assistance. 18 N.Y.C.R.R. —-§ 353. ci New York welfare allowances have consisted of two sep- arate types of grants. First, the basic, recurring grant. to cover food, clothing, household supplies, school expenses, and other items of basic subsistence, exclusive of rent and fuel for heating which are added to the allowance of the . recipient on a separate basis. The amount of this grant varies with the size of the family and the age of the oldest child (18 N.Y.C.R.R. § 352.4(a), (b)) because older children, _ particularly growing teenagers, require more in the way of food and clothing. . Payments are presently made according tc three sched- - ules promulgated by the State Commissioner of Welfare. One of them, set out below, covers the area of New York City.and nearby counties where most persons receiving aid reside, | | ewer 29a ‘4[Nps UB SB poJeZpnq st OUT Yons ‘plTyo B SB PozoSpnq you ueyA, ‘[0OYdS Zurpu0z3e AT1epnBe1 you st pus ' prryo sour: B jo juored oy} SB doMEZSISSB ButAlode1 Sf OY SSETUN P[TYO B SB peyospnq st [Z e3B8 sepun yuordroor Auy ‘ZE$ PPB ‘ployssnoy oy} UT OT 10A0 uossed [VUOIyIPpe Yous 10,7 . ‘eg ppv ‘dnoid prez @ ur yuatd~er Cg VV Yue 107 [-porqesiq puw pug fpedy 03 pry] ‘s$ ppe ‘euoye Buray quordyoor (GVW Ue JOF- | V-oc'e$ pps ‘proyssnoy ozs Aue ur uvMIOM yuBusoid ¥B 10,7 “3aps Teuory:ppe yoe.s 1OF OT$ ppv ‘AstIdjse UB YIM SPfoyosNoy Uy F[MpPs euo Wey} CLOUT SB} OLY} TOUM » Lz 8&3 86T 9ST Ort _ 99 a FOFs Lev cé6E pce ere 693 133 eLT sit TS 40 03 PITY? 3SePIO CFF s CIP» 98€ Cre 60E 693 133 eLT sit 6 40 ST PITY? IePIO T3¥« F6Es POEs cee £63 663 133 eLT sit LT 40 OT PIEY? ISEPIO 00F* GLEx CPEs PIEs €86 0S Ts | SaT sit ST 10 FT PITY? $0PIO SLE. ToEs 138s. 36G% S9G« OFS 103 oot Sit . €T 10 ST PIT¥? IPO Offs 638s 00Es TL3« OFS» 8TSs T6T 6st Lot TT 40 OT PITY? 3S9PLO FPEs LI€e . 88S« 693% 83S» £03* SLI ect L0T 6 10 8 PITYT3SEPIO SEEs POEs Clos OFS» Ole . ° G6Tx Cols | 8ETx LOT L 40 9 PITY9 3S9PIO 03Es €6G« 9Ge (FES F0Gs O8Ts 6ST CSTs *6 Jepun 10 o3¥ Jo sive ¢ P[ty? ySep[O SUudsLIgT SUuoslId SUu0sSLIT SUugsiad SUDSLIT SUu0sLIT SUuoslag SUudsSLIaT suoslagd uossoT VER A OUT yb. uanay rg any 4noy CERT Rf Ont . .aua Ayyquojy "4998949389,41 pun 493870 “y1ofIng ‘nvssvN ‘aosuojy ‘aussi ‘ssayoing :4O SAIZNQ00 ANV ALIO HXOA MAN L-VS aINGaHOS 30a The other two schedules, covering upstate areas, are simi- lar in form but somewhat lower in amounts. In May of each year, the Department of Social Services has conducted a cost-of-living survey. It has adjusted the standard of need as reflected in ehanging price levels as. of August of the same year. Since prices have been rising ‘ for some time, the yearly adjustment has required increases’ in the standard of need. Schedules presently in effect are based on a May, 1968 cost-of-living survey. They were issued on August 23, 1968 and each local Department of Social Services was required to implement them within nine months of August 1, 1968. . As supplements to the basic grant shown in Schedule SA-1, above, New York provides what it calls “special needs” grants. Special needs grants are designed to cover expenses for extraordinary or non-recurring items such as major items of clothing and furniture and household sup- plies (18 N.Y.C.R.R. §§ 352.4(¢), 352.5(j)), medically- dictated special diets (18 N.Y.C.R.R. § 352.4(b)(7), (8), (9)), moving expenses (18 N.Y.C.R.R. §352.5(m)), and- _ expenses incident to education (18 N.Y.C.R.R.. § 352.5(d)). See also 18 N.Y.C.R.R. §§ 352.4(c) (iv) (layette) ; 352.4(b) (6)(i) (restaurant allowance for persons unable to pre- pare meals at home) ; 18 N.Y.C.R.R. 352.5(b), (ce) (ex- penses incident to employment and securing employment) ;_ 352.5 ( g) (child care services) ; 352.5(h) (laundry services) ; 352.5(i) (telephone service when such service is incident to the production of income, health, or safety); 352.5(p) (transportation expenses to secure medical care or other essential verified transportation needs). These. grants are required because it is recognized that the basic schedules + si al ° . * - . Bn Ae oe . ° 3la ” provide no surplus from which additional needs can be met. Pursuant to a “demonstration project” instituted on Au- gust 27, 1968, New York welfare recipients in the City of © _ New York were given a flat cyclical grant of $100 per year; a family of four, for example, would receive $400 per year. This flat grant was designed to replace many—but not all— of the special needs grants and to eliminate the necessity of the welfare recipient applying for many small individual items as they were needed. Affidavits, studies and testimony before the Court agree that the present schedules, as supplemented by cyclical grants and special grants, are not in excess of present mini mum requirements for life at the lowest acceptable level in ' New York. As the Commissioner of the Nassau County Department of Social Services put it, speaking of the pre- section 131-a situation, “the present standards.of assistance provide for life on a level of sustenance, nothing’ more, and often less.” Or, as the Deputy Commissioner in the State Department of Social Services testified, AFDC re- cipients “of necessity have learned to squeeze every penny.” IV. New Yorx’s New Procram Section 131-a is intended to substantially alter the welfare system in New York State beginning in July, 1969. In place of the présent administratively drawn schedules based on annually determined costs of living, the size of the family and the age of the oldest child, it substitutes a sys- “} tem of flat grants set by the legislature and varying solely - with the size of the family. All special grants, including the $100 flat cyclical grant for New York City residents, are abolished (except for the special grant for the replace- a ee 32a ment of clothing and furniture destroyed by flood or fire). Two separate schedules of payments are created, one solely for ‘New York City and the other for the rest of the state. (The schedule for the rest of the state may be modified ad- ministratively so long as it does not exceed the schedule for the City of New York. See Rosado v. Wyman, —— F. Supp. —— (E.D.N.Y. 1969) (three-judge court) ).. The new schedules were computed by using the average payments toa family of four as the base and then adding or subtracting fixed amounts for additionaLor lesser num- - bers of children in families of different sizes. Set out be- low is the statutory schedule of maximum grants to resi- dents in the City of New York: Number of Persons in H ousehold One Two Three Four Five - Six Seven $70 $116 $162 $208 $254 $297 $340 For each additional eligible needy person in the house- hold there shall be an additional allowance of forty- ‘three dollars monthly. To these sums is added the cost of rent and fuel. A lower schedule is provided for areas outside the City. These schedules, the statute declares, “shall be deemed to make adequate provision for all items of need.” The state’s brief describes “the method of establishing the levels set forth in the schedules contained in the stat- ute” as follows: The mean age of the oldest child in each size family was ascertained. The mean age rather than the median was used as this produced a more generous result in most cases. The amount of allowance provided in 1968 33a for a family of each size in cases where the oldest - child was of the mean age was then adopted as the allowance for that size family. Where the mean -age contained a fraction, the older age was ‘used, ‘again — working a benefit to the recipient. Thus, for a family of four, which received amounts ranging from $152.00 ‘ to $221.00 (depending upon the age of its oldest child), _the mean age of such oldest child was found to be 10.09 and, therefore, $191.00, the figure where the old- © est child was ten or eleven, was used as a base amount. To this was added $17.00—the amount necessary to bring the allowance up to $35.35, the subsistence: level determined by the United. States Government for New York City for a family of four, or a monthly allow- ance of $208.00. The allowance for the remainder of the state was determined at a differéntial of $25.00 - fora family of four. As the computations of the De- partment show, these levels, based on the previous allowance incliding the cost of living increases of 1968, will result in. slightly increased benefits to families with younger children and slightly decreased benefits _ to those with older children. Memorandum of Law in Support of Defendants’ Motion ~ Summary Judg- ment, pp. 9- 10. It is not yet clear how such a statistically even-handed technique resulted in even steps of either $43 or $46 as the size of the. family increased. Special grants were seemingly not included in these computations. No attempt was made to average them out . acfoss the state and then to add that figure to that of the Basic recurring grant. ee | * | 34a Each of the individual plaintiffs in this action will suffer substantial cuts ranging up to 20% in their welfare pay- ments as a result of section 131-a. Set out below is a table listing the individual plaintiffs, thé number. of dependents | of each plaintiff, the monthly grant exclusive of rent each is currently receiving, and the maximum that each will _ receive. - : Maximum ' Size of Family ; Current . Under Plaintiff and: Age of Oldest Child Grant 181-0 Rosado 5 people, oldest child 14 . $280 $254 . Hernandez 3 people, oldest child16 $218 $162 Miley © 10people, oldest child15 — $535 $469 Abrom + 7 people, oldest child13 $406 $340 _ Gathers 7 people, oldest child 19 $382 $340 Lowman 8 people, oldest child14 $396 — $3883 King 9 people, oldest child 17 $482 $426 Folk. — 4 people, oldest child 16 $337 $208 Phillips 5 people, oldest child 14 $314.40 $224 Duffy 10 people, oldest child 20 $563.40. $389 (Plaintiffs Phillips and Duffy are residents of Nassau County.. If they resided in New York City, or if the Com- missioner .of Social Services increases their maximums as much as the statute permits, their respective maximums under section 13l-a would be $254 and $469.) As a result of the abolition of special grants, plaintiff Abrom, will not receive the following grants now supplied to her: $15 a month for large sized clothing for her chil- ~ .. - dren; $15 a month for medically required special diets; and $5.80 a month for the laundry of diapers. Plaintiff ' Miley will not be able to receive the following special grants now supplied: $155 a month for a homemaker and 35a $9 a month for a telephone, both required for medical reasons; and $80 a month for special diets for herself and her family. | While a large percentage of families, particularly tim living outside the New York City metropolitan area with young children and with little need for special grants, - will receive more under the new system than they do at present, a substantial majority of the AFDC families in the state will have their payments reduced on July 1, 1969. _ It is not clear how much the reductions will amount to inside and outside the city and by size of family. Most beneficiaries of the AFDC program live in New York City (657,000 out of a state total of 887,000 was the - 1968 monthly average). Under subpoena, and based upon statistics supplied by a State Department of Social Serv- ices study of July, 1968 and 1969-70 caseload projections, the Acting Deputy Director of the Bureau of Fiscal Ad. ‘ministration of Social Services of the City of New York ~ has made the following computations of the effect of sec- tion 13l-a in that City: The total benefits lost to diate will be $39,142, 768. . 63.5% of the cases will lose while .36.2% gain. The average annual loss per case will be 343.81 while the average — is 145. 55. - These computations have been controverted by defendants’ testimony indicating that 41.5% of AFDC cases would . receive increases, 58.1% would receive decreases and .04% would be unchanged. Apparently the plaintiffs’ computations include special and cyclical grants. They do not indicate the effect of the changes outside the City of New York. The effect of upstate residents seems to be less severe; approximately ~ ns RS AOR Ne 8 AS NRO ee Sg en ~s 36a 51% suffer cuts, while 49% are afforded increases. Any . possible gain to upstate residents, who comprise only a’ small percentage of AFDC recipients, probably does not offset the reductions to City residents of total amount of aid paid. It is not clear whether this result would be changed if counties outside New York City took advantage — of the opportunity afforded by the amendment ‘to section 131-a discussed in the per curiam opinion of the three- judge court, Rosado v. Wyman, F. Supp. —— (E.D. N.Y. 1969), and raised their schedules of payments to New ‘York City levels. Computations of loss by the parties apparently do net include allowance for a cost-of-living adjustment which } ‘has heretofore been made administratively each year in - May. Under section 131-a no cost-of-living adjustment will be made in 1969 even though it is undisputed that the New York City: Consumer Price Index has risen at an average rate of 0.5% per month in the last two years and that the rate of increase has accelerated since February of. this year. V. Reasons ror New York’s New Procram In the state’s view it “was not the case”. that section 13l-a resulted in a “reduction of: standards;” rather, it contends, section 13l-a was intended to, and did, main- tain the standard of heed while providing administrative streamlining. Reply Memorandum for Defendants, pp. 7-8. Its brief declares : > ; . ) ~ the adoption of §131l-a was the fruit of continuous legislative and departmental study of the problem of _ maintaining a standard of need during a period of sharply increasing numbers of recipients, especially in the ADC program. To avoid a reduction, adminis- -\ trative streamlining and elimination of individual de- ° 37a 7 terminations of eligibility for a plethora of special grants was regarded as essential. Jbid. The.adv ‘antages of a system of flat grants to the recipient are, the state contends,—and the plaintiffs do not dispute this—substantial : the flat grant concept, regarded as the most enlightened and progressive method of public assistance payment, eliminating the necessity of the welfare recipient ap- plying for individual items—often a degrading and time-consuming process—and thereby, enhancing his dignity, increasing. his ability to budget and self- respect, and freeing case workers from: bookkeeping decisions in order to allow them to devote their time to counseling. of recipients. Memorandum of Law In Support. of Defendants’ Motion for Summary —_ ment, p. 8. ' There is considerable doubt about the defendants’ sug- gestion that the new schedules were designed .wholly, or even primarily, to meet the demands of efficiency. The pro- posal to convert to a flat gfant system was initiated. by the New York State Board of Social Welfare. In its report to ‘the Governor in May, 1968 it recommended flat grants “based” on family size and the age of the oldest child” to “include food, clothing, personal incidentals, household sup- plies, school expenses” and the like, with “additional money amounts” in certain circumstances such as special diets or moving expenses, which are not common to all recipients.” Challenge and Response, 4 (May 1968). This proposed change was not designed to reduce stand- ards of need or payments. In a letter of Commissioner ‘Wyman to the Governor’s Counsel dated September 13, ‘ CORE EM ay vier Ft NS Te ee ee. oe re ae Sn ee? Laas, A oe aie BE an vpaaks Wayepaak. ie: — tance nasa ro ‘38a 1968, the flat grant system was spelled out in great detail as Proposal 20, an outline of a proposed bill to provide establishment of standards of assistance. The schedules included were those in present section 131, not the reduced, schedules in section 131-a. Moreover, many special grants such as those for special clothing and for diet supplements for pregnant women and medical patients were proyided. . And there was a provision for annual repricing of schedules . : _ “whenever the repricing shows an increase ‘or decrease of 2% or more. ” This proposal qwas never introduced in bill ; =‘ form. ' -' The Governor’s Budget, dated January 21, 1969, a not * indicate any plan for a shift in methods of computing stand- ards of need. See Executive Budget for the Fiscal Year April 1, 1969 to. March 31, 1970, 566-67, 571-72, 778-780. AFDC payments were expected to continue “to increase principally because of the increasing cost of living and a continued demand for public assistance recipients for the’ granting of special need items in addition to the basic subsistence allowances.” Id. at 779. The ‘percentage of federal aid was expected to decline because of a “freeze” on the number of children to be aided and restricted par- ticipation in cases of.aid due to unemployment of a parent. Ibid. Based upon monthly AFDC averages, the projected number of recipients for 1968-69 was 917,235 and for 1969- _ 70 it was 1,095,704. The average budgeted monthly grant was $74.57 for 1968-69 and $83.37 for. 1969-70. -Id. at 779. : The total 1969-70 AFDC program cost was projected at See ee : — $1,096,172,000 ; $440,195,000 was anticipated in federal aid: i Id. at 778. The estimated cost-of-liying increase for 1969- 70, based upon the system then in force was $5,000,000 and _ this sum was apparently included in the $1,096,172,000 fig- am ure. Since the share of the state and of local social-service EVA, ~ ae - — on’, - vs = peeseeen Bove 5 “ s ah PRL SIRE ce ER MG Ra Se NS acs nt SEE DS aR RRNA CE SES 39a districts is almost equal (id. at 778), $321,125,000 was budgeted for. 1969-70 as: the state’s share of the 1969-70 AFDC. program. The total Local Assistance Fund for State Aid Programs for the Department of Social Services was budgeted at $1, 040,514,000. Id. at 786. See also Sen. 1689, Ass. 2305 (1969). o® Beeause, the Governor reported, “necessary expenditures are expected to outstrip. available funds,” he suggested “a reduction in the level of recommended budget expendi- tures by approximately 5 per cent across-the-board.” Ex- ecutive Budget for the Fiscal Year April 1, 1969-to March 31, 1970, M7. The Local Assistance Fund, including AFDC contributions by the state, was to_be “limited to 95 per cent This would have redueed the catego a state aid to ifne by approximately $16,000,000 and all programs of state social service local aid would have been — by $52,- 000,000 to $988,000,000. a It is not clear from the Governor’s proposals whether bs the total AFDC program cost was intended to be reduced 5% from $1,096,172,000, for a cut of approximately $55,- 000,000, or whether the local social service districts were expected to. increase their share leaving the total program is Bain In any event, no one suggested that. the 5% et was anything but a money saving device. During the legislative session the Governor’s proposed budget was modified to provide greater aid than the Gov- ernor had requested for some items but to reduce state Aid to Dependent Children even further. The budget ’bills do not show the detailed amounts for each category of local aid but show a lump sum for all categorical assistance. Instead of $988,000,000 proposed by the Governor—after ee ee ee Se ee ha Is ee . - 2 ° ce TR ee ee 02 ae He AIOE athe ‘Bice | 2 nS RM Di Nil Rs Hina ph ER i Ly ae, ‘the 5% cut—$913,000,000 was ‘appropriated. Sen. 1689-A, Ass. 2305-A (adopted March 29, 1969, ch. 49, L. 1969). This constituted a reduction of approximately 127% from the original projected eost. We are informed that departmental x computations indicate that $297, 441, 000 was the amount in- tended for the. AFDC program, a saving of $23 684,000 or about 7% over the Governor’s Budget. When the $5,000, 000 amount in the Governor’s Budget for 1969 cost-of-living increases is eliminated the reduction is $18,684,000, or about _ 6%. Since the state’s share is some 34%, the decrease in total AFDC payments under the program seems to have ° been at least some $50,000,000. A further reduction of $42, 000, 000 was made by the sup- plemental budget,. making the total reduction in local aid for categorical. assistance some 16% from what the Gov- ernor’s Budget had estimated as projected costs. Sen. 5692, Ass. 7205 (adopted May 2, 1969, ch. 340, L. 1969). We are told by the state that if this sum is not supplied by the ~ federal government “‘the-1970—Legislature would—be—re- quested to cover the amount in a supplementary budget.” Defendants have indicated, in a letter to the Court dated * May 14, 1969, that the $42,000,000 cut in. the Supplemental Budget: was taken “from the $297,441,000 figure” for local AFDC aid. This would mean a total cut of $65,441,000 from the Governor’s original cost estimate of $321,125,000 for this item. Such a reduction of 20% in AFDC payments is so great as to suggest that it represents technical budge- . tary adjustments rather than reductions in payments to recipients. The same letter just referred to states: the budget bureau, which has been working at a break- neck speed at the end of the legislative session, has not been able to fully retrieve and prepare the tables on this amount to indicate whether the difference of :$23,- a 7s os ‘ a *. BRE ST ee pone Gee 4la | 684, 000 over the proposed budget, represents qdminis. . - trative savings or partial savings from the abolition of special grants and to what extent it contemplates an expanded purchase of services program. Some further explanation seems callé@¥or of how and avhy the budgets affecting AFDC were Mood. Timing of legislative action shows the close relation be- = tween the new AFDC program and budgetary decisions. Section. 131-a was not introduced until February 18, 1969 — in the Assembly (Ass. 6620) and March 27, 1969 in the Sen- ate (Sen. 5419), some time after the Governor’s Budget Message was delivered on January 21, 1969.’ ‘The amend- . - ment was adopted on March 29, 1969, the same day as the: budget. There is good reason to believe, when the budget is read with section 131- -a, that a cut in the projected cost of the total AFDC program as well as in the state contribu- tion was intended. . _ Since a reduction of_ payments, based on projections, ~ was likely to be required to achieve these budgetary reduc- tions, since all affidavits and testimony indicate that pay- ments have not been above the standard of need, and since New York continues to purport to. pay at 100% of standard’ of need under section 131-a, there is strong support for the - contention that standards of need were reduced. Motive and purpose of the legislature may be considered ° in determining what it in fact did. Cf. Williams v. Dand- ridge, F. Supp. (D. Md. 1969) (maximum grant regulation motivated by “an inadequate State ,appropria- tion”). The method by which this reduced appropriation was to be divided among recipients under section 131-a may well have permitted a more efficient administrative ‘system. But there is clearly a ait for the plaintiffs’. 42a contention that section 13l-a worked a reduction of stand- ard of payment. ne Defendants argue that the elimination of the cyclical, grant and the special grants are not to be considered in determining whether the standard of payment has been reduced since they “were over and above New York’s pay- ment of 100% of its standard of need” and, thus, “totally gratuitous on the part of the State.” Memorandum of Law in Support of Defendants’ Motion for Summary Judgment, © p. 25. This argument is difficult to credit. The festimony ; of witnesses for the plaintiffs and the witness for the de- fendant:- ‘agree that New York does not pay more than is required for. bare subsistence. Special grants are: not _ luxuries; they are merely a different method for meeting family and individual need for bdre necessities. In fact, New York’s definition of the standard of need prior. to adoption of section 131-a included items covered by special — "An individual or family shall be deemed “in need” when a budget deficit exists or when the budget sur: plus is inadequate to meet one or more non-budgeted special needs retjuired by the case circumstances and ~ included in the standards of assistance. 18 x .Y.C.R.R. § 353.1(¢). See also 18 N:Y.C.R.R. § 353.1(d) (“all items of basic main- tenance and all items of special need required by case cir- cumstances” comprise the recipient’ S estimate of regu- arly recurring need”). Defendants suggested on argument that the State Com-. _ missioner of Welfare was considering the adoption of pro- viding for some of the special grants “on a purchase of ser- vice basis.” To date we have not been favored with a copy 43a nS of any such regulations. It is mot clear from the argument that such regulations will, if adopted, cover cyclical or — special grants to the same extent as they were covered prior to adoption of section 131-a:. .-' : This Court is not, of course, concerned. with justifications for state budgetary decisions, nor does it sit to discourage . desirable improvement in the efficiency of state welfare pro- * grams. The issue before us is whether the system of re- ‘ ducing standards of need and levels of payment embodied _ _ in section 131-a violates federal statutes. We turn now ; to the relev ant federal provision for an answer to that ques- tion. neat s . VI. Feperat Limitations on_Repuctions —— in. AiD TO DEPENDENT CHILDREN | A. Seiad Paragraph 23 of subdivision (a) of section 402 of the Social Security Act of 1935, as amended (42 U.S.C. $602 ( a) (28), requires that each state’s AFDC plan must: _ provide that by J uly 1, 1969, the amounts used by the State to determine the needs of individuals will have been adjusted to reflect fully changes in: living costs — since such amounts were established, and. any maxi- - mums that the State imposes on the amount of aid paid . to families wn have been proportionately apeene. This provision was effective January 2, 1968.. Pub. L. 90- 248, Title II, § 202(b); 81 Stat. 821. ° 3 Defendants contend that 402(a)(23) should be nar- rowly construed. They interpret it as- being primarily aimed at raising a state’s standard of need and as not controlling a ‘state’s level of benefits to AFDC recipients. * cas 1 wenden ee ee ee ee SS ed he. rely upon the } position gf HEW. as expressed i in its amicus . brief: filed in pam - La. 1969) and the fmplementing regulation*of HEW ‘which would. permit a state to make downward adjustments in. ‘the amount of AFDC payments through the device of . “ratable reductions”—#.e., percentage reductions applied ~~, to the standard of need. 45 C.F.R.. § 233.20(a) (2) (ii), 34 Fed. Reg. 1394 (1969). We disagree and hold that a » 44a In support of this construction of the statute, defendants v. Bonin, —— F. Supp. (E.D. broader construction of 402(a)(23) is required by lan- guage, statutory history and good ‘sense. Section 402(a) (23) plainly states that both the “amounts used by the State to determine the needs of individuals”— i.e., the standard of need—and “any maximums that the State i imposes on the amount of aid paid:to families’”—i.e., the level of benefits—be adjusted “to reflect fully changes in living costs since such amounts were established. ” The adjustment contemplated by. 402(a) (23) is undoubtedly a upward one’in view of the inflationary trend this countr has experienced over the last two decades. The one judge who has heretofore considered this question at length has reached a similar conclusion. Lampton vy. Bonin, —— F. Supp. (E.D. La. 1969) (dissent, setting out legis- lative Mater at length; the majority, did not reach the. question) (“Congress’ intention to compel the states to . raise ADC payments”). See also Dandridge v. Williams, —— F. Supp. , —— (D. Md. 1969) (“designed te in- _ erease benefits to keep pace with living costs”). This federal provision grew out of an attempt to reform the inequitable and unsatisfactory aspects of our present welfare system resulting from the inadequate and widely varying level of grants among the states. The solution first ' proposed by HEW would have required all states to meet ie ae A tert RATES SURE at kn eta a ea ewes e cA eal 45a in full their own need standards and to adjust payments annually so as to maintain payments at the 100% level despite intervening, inflationary price rises. Congress: put _ off enacting any basic change to allow further study and ~ - consideration of .altérnatives. At the same time, it did take an interim step, a helding action against further deteriora- .tion in levels of benefit. Section 402 (a) (23) embodies that interim wih temporary solution. It creates a floor under present levels of benefit ‘by prohibiting future cuts in welfare payments: and by requiring that all states provide at least one increase by - July 1; 1969 to at least partially compensate for the rise ' in the cost-of-living. As already. noted, section 402(a) (23) grew out of an Administration proposal to require all states to pay 100% -of need and to make annual cost-of-living adjustments be- ginning July 1, 1969. This proposal was originally em- bodied in the bill introduced in the House in 1967 at the request’ of the Administration to’amend the Social Security Act. Section 202 of H.R. 5710, 90th Cong.,. Ist Sess. The bill ultimately reported out by the House Ways and Means Committee and passed by. the House, H. R. 12080, contained fo such provision. The Administration renewed its request in the hearings before the Senate Finance Committee and proposed the. following amendment-to the House Bill: | [each state plan must] provide (A) effective July 1 1969, for meeting ... all the need, as determined in accordance with standards applicable under the plan - for determining need, of individuals eligible to receive - aid to families with deperdent’ children .. . and (B), effective July 1, 1969, for