Supplemental Security Income For the Aged, Blind, and Disabled; Indian Judgment Funds and Per Capita Distributions

DEPARTMENT OF HEALTH AND HUMAN SERVICES

20 CFR Part 416

RIN 0960-AB86

Supplemental Security Income For the Aged, Blind, and Disabled;

Indian Judgment Funds and Per Capita Distributions

AGENCY : Social Security Administration, HHS.

ACTION : Final rules.

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SUMMARY: These final regulations update the lists of types of income

and resources that are excluded under the supplemental security income

(SSI) program by Federal laws other than the Social Security Act (the

Act) by reflecting the provisions of Public Law 97-458, enacted January

12, 1983, Public Law 98-64, enacted August 2, 1983, and Public Law 100-

241, enacted February 3, 1988. In addition, we are making two minor

technical changes. The effects of these final regulations are, in

certain cases, to provide additional exclusions from income and

resources permitting eligibility for, or increases in the payment of,

SSI benefits.

EFFECTIVE DATE: February 23, 1994.

FOR FURTHER INFORMATION CONTACT: Duane Heaton, Legal Assistant, 3-B-1

Operations Building, 6401 Security Boulevard, Baltimore, MD 21235,

(410) 965-8470.

SUPPLEMENTARY INFORMATION:

Background:

Public Law 97-458

Public Law 97-458 was enacted January 12, 1983. Section 4 of this

legislation provides that certain Indian judgment funds held in trust

by the Secretary of the Interior or distributed per capita pursuant to

a plan prepared by the Secretary of the Interior and not disapproved by

a joint resolution of the Congress are excluded from income and

resources under the SSI program. Indian judgment funds include interest

and investment income accrued while the funds are held in trust. The

exclusion extends to initial purchases made with Indian judgment funds.

The exclusion does not apply to the proceeds from sales or conversions

of initial purchases or to subsequent purchases made with funds derived

from sales or conversions of originally excluded purchases, because

Congress sought to protect only the distributions made by the Secretary

of the Interior.

Section 4 of Public Law 97-458 also excludes from resources any

interests of Indians in trust or restricted Indian lands. Our current

regulations address only those lands that such individuals may possess.

These final regulations now also exclude from resources nonpossessory

interests in such lands.

Public Law 98-64

Public Law 98-64 was enacted August 2, 1983. This legislation

excludes all funds held in trust by the Secretary of the Interior for

an Indian tribe and distributed on a per capita basis from income and

resources for SSI purposes.

The Social Security Administration (SSA) sought advice from the

Department of the Interior on the issue of whether Alaska Native

Regional and Village Corporation (ANRVC) dividends not excluded under

the Alaska Native Claims Settlement Act (ANCSA) could be excluded under

Public Law 98-64. SSA issued interim instructions directing that ANRVC

dividend distributions paid on or after August 2, 1983, whether or not

excluded under ANCSA, would be excluded for SSI purposes pending

resolution of the issue.

The Department of the Interior has since advised SSA that funds

held by ANRVCs are not ``funds held in trust by the Secretary of the

Interior'' within the purview of Public Law 98-64. We therefore

concluded that these ANRVC dividend distributions could not qualify for

exclusion for SSI purposes under that law.

Public Law 100-241

A new law, Public Law 100-241, was enacted on February 3, 1988.

Under this law, none of the following, received from a Native

Corporation, is considered income or resources of an individual Alaska

Native or a descendant of an Alaska Native: cash (including cash

dividends on stock received from a Native Corporation) to the extent

that it does not, in the aggregate, exceed $2,000 per individual per

year (the exclusions are applied each year to the amount received in

such year); stock (including stock issued or distributed by a Native

Corporation as a dividend or distribution on stock); a partnership

interest; land or an interest in land (including land or an interest in

land received from a Native Corporation as a dividend or distribution

on stock); and an interest in a settlement trust.

Public Law 100-241 specifically provides that cash received from a

Native Corporation (including cash dividends on stock received from a

Native Corporation), to the extent that it does not, in the aggregate,

exceed $2,000 per individual per year, shall not be considered or taken

into account as an asset or resource. Although this statutory provision

does not explicitly mention ``income,'' the legislative history clearly

shows that such cash should not be considered a resource or ``otherwise

utilized in determining eligibility.'' H.R. Rep. No. 31, 100th Cong.,

1st Sess. 20 (1987). This language seems to require the exclusion of

the distributions from income as well as resources, to the extent that

they do not, in the aggregate, exceed $2,000 per individual per year in

determining eligibility and payment amount. To exclude a portion of the

distributions only from resources would result in benefit reductions or

ineligibility in months in which the distributions are received and

would be contrary to congressional intent. Therefore, we have changed

the income provisions of the appendix to subpart K to reflect the

exclusion.

In accordance with Public Law 100-241, we exclude ANRVC cash

(including cash dividends on stock received from a Native Corporation)

to the extent that this ANRVC cash does not, in the aggregate, exceed

$2,000 per individual per year. With respect to resources, we apply the

exclusion to each calendar year without regard to the prior year, so

that retained cash not exceeding $2,000 which an individual received

from a Native Corporation in a prior year will not be counted in a

subsequent year. This interpretation is consistent with the policy of

the Aid to Families with Dependent Children program. Any retained cash

exceeding $2,000 per year will be counted toward the SSI resource

limit.

Regulations Changes

The appendix to subpart K lists the types of income that are

excluded under the SSI program by Federal laws other than the Act and

explains how exclusions provided by other Federal statutes apply to

income deemed from a sponsor to an alien. We are amending the appendix

to subpart K, IV. Native Americans, on the basis of the legislation

discussed above by revising paragraph (a), deleting paragraph (b)(4),

redesignating paragraphs (b)(5) through (b)(13) as (b)(4) through

(b)(12), and adding new paragraphs (g) and (h). In addition, paragraphs

(g) and (h) provide that the exclusion applies to the sponsor's income

only if the alien lives with the sponsor, because the statute

authorizing the exclusions applies only to benefits to which the

household or member of the household would be eligible.

Similarly, we are amending subpart L of the regulations, which

deals with resources and exclusion of resources under the SSI program,

to reflect the above legislation. Specifically, we are amending

Sec. 416.1234 regarding exclusion of Indian lands and, Sec. 416.1236,

which encompasses resource exclusions provided by other statutes.

Public Comment

A Notice of Proposed Rulemaking (NPRM) was published on July 27,

1992 (57 FR 33137). A 60-day comment period was provided. The comment

period ended September 25, 1992. We received 9 comments. The comments

generally supported the NPRM. We have summarized and responded to the

issues raised in the comments below.

Comment: Seven commenters expressed concern that the Secretary of

Health and Human Services (the Secretary) might begin to apply a $2,000

annual limit to all exclusions of Indian judgment funds and per capita

distributions. They stated that the proposed regulations were unclear

as to whether ANCSA, as amended by Public Law 100-241, might adversely

affect the SSI benefits of Native Americans other than Alaska natives.

Response: ANCSA provides for the exclusion of ANRVC cash to the

extent that it does not, in the aggregate, exceed $2,000 per individual

per year. The provisions of ANCSA apply only to ANRVC distributions to

Alaska Natives. We believe this is clearly explained in the amended

regulations at paragraph IV(a) of the appendix to subpart K and at

Sec. 416.1236(a)(10). In accordance with Public Law 97-458 and Public

Law 98-64, the Secretary totally excludes all judgment fund and per

capita distributions made pursuant to those public laws.

Comment: One commenter asked why the proposed regulations did not

refer to a $2,000 limit for per capita distributions to Indian tribal

members other than Alaska Natives, because Public Law 97-458 appears to

include such a limit. Five commenters suggested that instead of

applying a $2,000 annual limit on Indian judgment fund and per capita

distributions, the Secretary should apply a $2,000 per payment limit,

in accordance with Public Law 97-458 and Public Law 98-64.

Consequently, only Indian judgment funds or per capita distributions in

excess of $2,000 per payment would be countable for SSI purposes.

Response: There appears to be some confusion over whether, as a

result of the proposed regulations, SSA would or could begin to apply a

$2,000 exclusion limit to other than ANSCA distributions. SSA never

intended to apply a $2,000 limit to such other distributions and these

final regulations clearly do not do so.

Public Law 97-458 provides that any Federal or federally assisted

program, other than Social Security Act programs, shall not consider

Indian judgment funds except for per capita shares in excess of $2,000,

as income or resources. However, the statute does not limit the amount

of payments that can be excluded under the Social Security Act

programs. Public Law 98-64 does not provide a $2,000 limit on exclusion

of funds covered by that statute.

Accordingly, for SSI purposes the Secretary excludes from income

and resources all judgment fund and per capita distributions made under

Public Law 97-458 and Public Law 98-64.

Comment: One commenter proposed that foster care payments paid to

tribal members to help defray the costs of basic needs, and that

General Assistance payments from the Bureau of Indian Affairs be

excluded from income and resources under the SSI program.

Response: We believe that the exclusions proposed by the commenter

would require the enactment of new legislation. Accordingly, in the

absence of such authority, we have not revised the regulations to

incorporate such exclusions.

Comment: One commenter suggested that the proposed regulations not

limit the exclusion of purchases contained in Pub. L. 97-458 to initial

purchases made with Indian judgment funds and per capita distributions,

because that law refers to ``* * * any purchases made with such funds *

* *''

Response: The exclusion of purchases in Pub. L. 97-458 does not

apply to proceeds from the sales or conversions of initial purchases or

to purchases made with the money derived from the sales or conversions

of initial purchases. As indicated earlier in this preamble, this

policy reflects Congressional intent to protect only the distributions

made by the Secretary of the Interior. Any purchases made subsequent to

initial purchases would not be made from distributions made by the

Secretary of the Interior. Furthermore, tracking the funds beyond the

initial purchase would be administratively difficult, if not

impossible.

Comment: One commenter suggested that the Secretary correct a

conflict between Sec. 416.1210(i) and Sec. 416.1234 as proposed.

Section 416.1210 provides a list of resource exclusions with

corresponding regulatory citations. Specifically, Sec. 416.1210(i),

states that the resource exclusion of restricted allotted land applies

to ``an enrolled member of an Indian tribe as provided in

Sec. 416.1234.'' Section 416.1234 states that the exclusion applies to

``an individual * * * who is of Indian descent from a federally

recognized Indian tribe,'' and does not limit its exclusion to an

enrolled member of an Indian tribe.

Response: We agree that Sec. 416.1210(i) may appear to be in

conflict with Sec. 416.1234. Although a change to correct this possible

inconsistency was not included in the NPRM, we believe a technical

change to correct our oversight and make our intent clear is

appropriate. Therefore, we are making a technical change to the

regulations at Sec. 416.1210(i) to read, ``Restricted allotted Indian

lands as provided in Sec. 416.1234;'' to provide a simplified and more

accurate cross-reference.

Other Regulations Changes

The provisions of Public Law 98-64 regarding the exclusion of

certain funds from income are reflected in the appendix to Subpart K,

IV. Native Americans, by the addition of paragraph (h) to these final

regulations. This obviates the need for continuance of paragraph (c)(3)

which only partially reflects the income exclusion provisions of Public

Law 98-64. Paragraph (c)(3) is duplicative and no longer needed.

Therefore, we are making a technical change to the regulations by

deleting paragraph (c)(3).

Except for the technical change in response to an issue raised by a

public comment and the technical change to remove a duplicative

provision, we are adopting these regulations as proposed.

Regulatory Procedures

Regulatory Flexibility Act

We certify that these regulations will not have a significant

impact on a substantial number of small entities. Therefore, a

regulatory flexibility analysis as provided in Public Law 96-354, the

Regulatory Flexibility Act, is not required.

Paperwork Reduction Act of 1980

These regulations impose no additional reporting and recordkeeping

requirements necessitating clearance by the Office of Management and

Budget.

(Catalog of Federal Domestic Assistance: Program No. 93.807--

Supplemental Security Income)

List of Subjects in 20 CFR Part 416

Administrative practice and procedure, Aged, Blind, Disability

benefits, Public assistance programs, Reporting and recordkeeping

requirements, Supplemental Security Income.

Dated: November 19, 1993.

Shirley Chater,

Commissioner of Social Security.

Approved: February 8, 1994.

Donna E. Shalala,

Secretary of Health and Human Services.

Part 416 of title 20 of the Code of Federal Regulations is amended

as follows:

1. The authority citation for Subpart K of Part 416 continues to

read as follows:

Authority: Secs. 1102, 1602, 1611, 1612, 1613, 1614(f), 1621,

and 1631 of the Social Security Act; 42 U.S.C. 1302, 1381a, 1382,

1382a, 1382b, 1382c(f), 1382j, and 1383; sec. 211 of Pub. L. 93-66,

87 Stat. 154.

2. In the appendix following subpart K of part 416, under the

heading IV. Native Americans, the text preceding the note in paragraph

(a) is revised, paragraph (b)(4) and the note following it are removed,

paragraphs (b)(5) through (b)(13) are redesignated (b)(4) through

(b)(12) respectively, paragraph (c)(1) is amended by adding the word

``and'' after the semicolon, paragraph (c)(2) is amended by removing

the semicolon and the word ``and'' and adding a period, paragraph

(c)(3) is removed, and new paragraphs (g) and (h) are added to read as

follows:

Appendix to Subpart K of Part 416--List of Types of Income Excluded

Under the SSI Program as Provided by Federal Laws Other Than the Social

Security Act

* * * * *

IV. Native Americans

(a) Distributions received by an individual Alaska Native or

descendant of an Alaska Native from an Alaska Native Regional and

Village Corporation pursuant to the Alaska Native Claims Settlement

Act, as follows: cash, including cash dividends on stock received from

a Native Corporation, to the extent that it does not, in the aggregate,

exceed $2,000 per individual each year; stock, including stock issued

or distributed by a Native Corporation as a dividend or distribution on

stock; a partnership interest; land or an interest in land, including

land or an interest in land received from a Native Corporation as a

dividend or distribution on stock; and an interest in a settlement

trust. This exclusion is pursuant to section 15 of the Alaska Native

Claims Settlement Act Amendments of 1987, Public Law 100-241 (43 U.S.C.

1626(c)), effective February 3, 1988.

* * * * *

(g) Indian judgment funds that are held in trust by the Secretary

of the Interior or distributed per capita pursuant to a plan prepared

by the Secretary of the Interior and not disapproved by a joint

resolution of the Congress under Public Law 93-134 as amended by Public

Law 97-458 (25 U.S.C. 1407). Indian judgment funds include interest and

investment income accrued while such funds are so held in trust. This

exclusion extends to initial purchases made with Indian judgment funds.

This exclusion does not apply to sales or conversions of initial

purchases or to subsequent purchases.

Note--This exclusion applies to the income of sponsors of aliens

only if the alien lives in the sponsor's household.

(h) All funds held in trust by the Secretary of the Interior for an

Indian tribe and distributed per capita to a member of that tribe are

excluded from income under Public Law 98-64 (25 U.S.C. 117b). Funds

held by Alaska Native Regional and Village Corporations (ANRVC) are not

held in trust by the Secretary of the Interior and therefore ANRVC

dividend distributions are not excluded from countable income under

this exclusion. For ANRVC dividend distributions, see paragraph IV(a)

of this Appendix.

Note--This exclusion applies to the income of sponsors of aliens

only if the alien lives in the sponsor's household.

3. The authority citation for subpart L of part 416 continues to

read as follows:

Authority: Secs. 1102, 1602, 1611, 1612, 1613, 1614(f), 1621,

and 1631 of the Social Security Act; 42 U.S.C. 1302, 1381a, 1382,

1382a, 1382b, 1382c(f), 1382j, and 1383; sec. 211 of Pub. L. 93-66,

87 Stat. 154.

4. Section 416.1210(i) is revised to read as follows:

Sec. 416.1210 Exclusions from resources; general.

* * * * *

(i) Restricted allotted Indian lands as provided in Sec. 416.1234;

* * * * *

5. Section 416.1234 is revised to read as follows:

Sec. 416.1234 Exclusion of Indian lands.

In determining the resources of an individual (and spouse, if any)

who is of Indian descent from a federally recognized Indian tribe, we

will exclude any interest of the individual (or spouse, if any) in land

which is held in trust by the United States for an individual Indian or

tribe, or which is held by an individual Indian or tribe and which can

only be sold, transferred, or otherwise disposed of with the approval

of other individuals, his or her tribe, or an agency of the Federal

Government.

6. In Sec. 416.1236, paragraphs (a)(3) and (a)(10) are revised and

paragraph (a)(12) is added to read as follows:

Sec. 416.1236 Exclusions from resources; provided by other statutes.

(a) * * *

(3) Indian judgment funds held in trust by the Secretary of the

Interior or distributed per capita pursuant to a plan prepared by the

Secretary of the Interior and not disapproved by a joint resolution of

the Congress under Public Law 93-134, as amended by Public Law 97-458

(25 U.S.C. 1407). Indian judgment funds include interest and investment

income accrued while the funds are so held in trust. This exclusion

extends to initial purchases made with Indian judgment funds. This

exclusion will not apply to proceeds from sales or conversions of

initial purchases or to subsequent purchases.

* * * * *

(10) Distributions received by an individual Alaska Native or

descendant of an Alaska Native from an Alaska Native Regional and

Village Corporation pursuant to the Alaska Native Claims Settlement

Act, as follows: cash, including cash dividends on stock received from

a Native Corporation, is disregarded to the extent that it does not, in

the aggregate, exceed $2,000 per individual each year (the $2,000 limit

is applied separately each year, and cash distributions up to $2,000

which an individual received in a prior year and retained into

subsequent years will not be counted as resources in those years);

stock, including stock issued or distributed by a Native Corporation as

a dividend or distribution on stock; a partnership interest; land or an

interest in land, including land or an interest in land received from a

Native Corporation as a dividend or distribution on stock; and an

interest in a settlement trust. This exclusion is pursuant to the

exclusion under section 15 of the Alaska Native Claims Settlement Act

Amendments of 1987, Public Law 100-241 (43 U.S.C. 1626(c)), effective

February 3, 1988.

* * * * *

(12) All funds held in trust by the Secretary of the Interior for

an Indian tribe and distributed per capita to a member of that tribe

under Public Law 98-64. Funds held by Alaska Native Regional and

Village Corporations (ANRVC) are not held in trust by the Secretary of

the Interior and therefore ANRVC dividend distributions are not

excluded from resources under this exclusion. For treatment of ANRVC

dividend distributions, see paragraph IV(a)(10) of this appendix.

* * * * *

[FR Doc. 94-3960 Filed 2-22-94; 8:45 am]

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