Food Stamp Program: Monthly Reporting on Reservations Provision of the Food Stamp Program Improvements Act of 1994

SUMMARY: This rulemaking proposes to amend Food Stamp Program

regulations to establish procedures for implementing the restrictions

concerning use of monthly reporting for households residing on

reservations contained in the Food Stamp Program Improvements Act of

1994.

DATES: Comments must be received on or before August 7, 1995 to be

assured of consideration.

ADDRESSES: Comments on this proposed rulemaking should be addressed to

Margaret Thiel, Acting Supervisor, Eligibility and Certification

Regulations Section, Certification and Policy Branch, Program

Development Division, Food Stamp Program, Food and Consumer Service,

USDA, 3101 Park Center Drive, Alexandria, Virginia 22302. (Datafax

number 703-305-2454). All written comments will be open to public

inspection at the office of the Food and Consumer Service, during

regular business hours (8:30 a.m. to 5:00 p.m., Monday through Friday),

at 3101 Park Center Drive, Alexandria, Virginia, Room 718.

FOR FURTHER INFORMATION CONTACT: Questions regarding this proposed

rulemaking should be addressed to Margaret Thiel at the above address

or by telephone at (703) 305-2496.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This proposed rule has been determined to be not significant for

purposes of Executive Order 12866 and therefore has not been reviewed

by the Office of Management and Budget.

Executive Order 12372

The Food Stamp Program is listed in the Catalog of Federal Domestic

Assistance under No. 10.551. For the reasons set forth in the final

rulemaking and related Notice(s) to 7 CFR 3105, Subpart V (Cite 48 FR

29115, June 24, 1983; or 48 FR 54317, December 1, 1983, as appropriate,

and any subsequent notices that apply), this program is excluded from

the scope of Executive Order 12372 which requires intergovernmental

consultation with State and local officials.

Regulatory Flexibility Act

This proposed rulemaking has also been reviewed with respect to the

requirements of the Regulatory Flexibility Act of 1980 (Pub. L. 96-354,

94 Stat. 1164, September 19, 1980). The Administrator of the Food and

Consumer Service (FCS), has certified that this proposal would not have

a significant economic impact on substantial number of small entities.

The primary impact of the procedures in this rulemaking would be on FCS

Regional Offices, State governments, and individuals who might apply

for benefits in State agencies that use monthly reporting procedures.

To the extent that county or other local governments assist in the

administration of the Food Stamp Program, they would also be affected.

Executive Order 12778

This proposed rulemaking has been reviewed under Executive Order

12778, Civil Justice Reform. This rule is intended to have preemptive

effect with respect to any State or local laws, regulations, or

policies which conflict with its provisions or which would otherwise

impede its full implementation. This rule is not intended to have

retroactive effect unless so specified in the EFFECTIVE DATE section of

this preamble. Prior to any judicial challenge to the provisions of

this rule or the application of its provisions all applicable

administrative procedures must be exhausted. In the Food Stamp Program

the administrative procedures are as follows: (1) For Program benefit

recipients--state administrative procedures issued pursuant to 7 U.S.C.

2020(e)(10) and 7 CFR 273.15; (2) for State agencies--administrative

procedures issued pursuant to 7 U.S.C. 2023 set out at 7 CFR 276.7 (for

rules related to nonquality control (QC) liabilities) or Part 283 (for

rules related to QC liabilities); (3) for retailers and wholesalers--

administrative procedures issued pursuant to 7 U.S.C. 2023 set out at 7

CFR 278.8.

Paperwork Reduction Act

Pursuant to the Paperwork Reduction Act of 1980 (44 U.S.C. 3507),

reporting and recordkeeping requirements for monthly reporting and

retrospective budgeting have been approved by the Office of Management

and Budget (OMB) under current OMB No. 0584-0064. Although the

provisions of the proposed rule change the content of certain notices

to households, they do not impose additional reporting and

recordkeeping burden requirements.

Background

Section 1723 of the Mickey Leland Memorial Domestic Hunger Relief

Act (Title XVII of the Food, Agriculture, Conservation, and Trade Act

of 1990, Pub. L. 101-624, 104 Stat. 3359, November 28, 1990) amended

Section 6(c)(1)(A)(i) of the Food Stamp Act of 1977, as amended (the

Act), 7 U.S.C. 2015(c)(1)(A)(i), to exempt households residing on

reservations from monthly reporting and retrospective budgeting (MRRB)

effective February 1, 1992. The Department announced the regulatory

adoption of the requirements of Section 1723 in a final rule amending 7

CFR 273.21(b)(4) published on December 4, 1991, 56 FR 63605, and

scheduled to take effect on February 1, 1992.

Since that time, several pieces of legislation were enacted, each

delaying the effective date of Section 1723. Implementation was

initially postponed by Section 908 of the Food, Agriculture,

Conservation, and Trade Act Amendments of 1991 (Pub. L. 102-237, 105

Stat. 1818, December 13, 1991) until April 1, 1993, and then by Pub. L.

103-11 (107 Stat. 41, April 1, 1993) until February 1, 1994. In

response, in a November 1, 1993, rulemaking, the Department proposed at

58 FR 58459 a new implementation date of February 1,

[[Page 29768]] 1994. Following publication of that proposed rule,

Section 1 of Pub. L. 103-205 (107 Stat. 2418) was enacted on December

17, 1993, again postponing implementation of the prohibition concerning

MRRB on reservations until March 15, 1994. State agencies were notified

of this delay through an implementing memorandum dated January 6, 1994.

On March 25, 1994, the Food Stamp Program Improvements Act of 1994

(Pub. L. 103-225 (108 Stat. 106)) was enacted. Section 101(a) of that

law modified the prohibition against monthly reporting for households

residing on reservations that had been added to section 6(c)(1)(A) of

the Act (7 U.S.C. 2015(c)(1), by Section 1723 of the Leland Act.

Section 6(c)(1)(C)(iii) now prohibits State agencies which were not

requiring households residing on reservations to submit monthly reports

on March 25, 1994, from establishing monthly reporting requirements for

these households. These households may be retrospectively budgeted.

State agencies that were using monthly reporting on March 25, 1994, for

households residing on reservations may continue to do so if certain

enumerated conditions are met. On August 29, 1994, in the Miscellaneous

Provisions of the Food, Agriculture, Conservation, and Trade Act

Amendments of 1991 and Earned Income Tax Credit Amendment final rule

(59 FR 44303), the Department addressed the prohibition against

establishing new monthly reporting for households residing on

reservations if no monthly reporting system was in place on March 25,

1994.

In this rulemaking, the Department is addressing the provisions in

Section 101(a) of Pub. L. 103-225 dealing with the one-month grace

period afforded reservation households for submitting required reports,

7 U.S.C. 2015(c)(1)(C)(i) and (ii). This subparagraph establishes the

following requirements on a State agency if it requires monthly

reporting for households residing on reservations:

(1) Reinstate benefits without requiring a new application for any

household that submits a report not later than one month after the end

of the issuance month; and

(2) do not delay, reduce, suspend, or terminate the allotment of a

household that submits a report not later than one month after the end

of the month in which the report is due; and

(3) establish two-year certification periods for households on

reservations required to submit monthly reports, unless the State

agency is granted a waiver for shorter certification periods.

In order to implement these legislative requirements, the

Department is proposing a new paragraph Sec. 273.21(t). The specific

provisions of this new paragraph are discussed below.

Definition of Residing on a Reservation

Section 3(j) of the Act defines a reservation as ``the

geographically defined area or areas over which a tribal organization

(as that term is defined in subsection (p) of this section) exercises

governmental jurisdiction.'' Section 3(p) of the Act defines a tribal

organization as ``the recognized governing body of an Indian tribe

(including the tribally recognized intertribal organization of such

tribes), * * * , as well as any Indian tribe, band, or community

holding a treaty with a State government.'' Section 10(a) of Pub. L.

103-225 did not modify the Act's definition of a reservation or tribal

organization. Accordingly, the Department is proposing in

Sec. 273.21(t)(1) to adopt these definitions for the purpose of

determining whether a household shall be considered to be residing on a

reservation.

Certification Periods

In light of the amendments to Section 6(c)(1) of the Act made by

Section 101(a) of Pub. L. 103-225, the Act now requires that State

agencies establish two (2) year certification periods for households

residing on reservations that are required to submit monthly reports (7

U.S.C. 2015(c)(1)(C)(iv)). In order to implement this requirement, the

Department is proposing at Sec. 273.21(t)(2) to require that monthly

reporting households residing on a reservation be certified for two (2)

years.

However, Section 6(c)(1)(C)(iv) allows FCS to permit a State agency

to establish certification periods for households residing on

reservations shorter than two (2) years if the State agency can show

good cause for a shorter certification period. Therefore, the

Department is proposing in 7 CFR 273.21(2)(i) that a State agency may

request a waiver to allow it to establish shorter certification periods

for those households. In considering a request for a waiver to allow

shorter certification periods, the Department has been urged by the

Congress to consider both the reasons the State desires to implement a

shorter certification period and the burden that households on the

particular reservation would face in going through the recertification

process more often. Cong. Rec. S2905, March 11, 1994. Further, Congress

has also indicated that the Department should exercise its discretion

to waive the two (2) year certification period requirement only after

consultation with the appropriate tribal government and when

extraordinary circumstances exist, such as widespread fraud, a

substantial change in circumstances on a reservation which results in

wide fluctuations in income for large numbers of food stamp recipients,

or similar changes which require more frequent certification to protect

the financial integrity of the Program and to maintain the lowest

practicable error rates. Cong. Rec. S2906, March 11, 1994. In

considering any approval of a waiver, the Department will be taking

into account the administrative burdens of the State agency in

administering the two (2) year certification periods, the input of the

affected tribal organization, the quality control (QC) error rate for

the affected households, and the impact on the households of requiring

them to be interviewed more frequently than every two years.

Anecdotal information provided to the Department by State agencies

affected by this provision indicates that households frequently move

off of and on to reservations. With this in mind, the Department is

proposing to allow a State agency to opt either to continue the two-

year certification period for any household that moves off a

reservation or to shorten the certification period as appropriate to

the household's reporting requirements off the reservation. The

Department is providing this option to increase flexibility for State

agencies and to meet potential concerns about QC error rates. Switching

households back and forth between two-year and shorter certification

periods is administratively complex. However, the Department recognizes

that long certification periods could result in increased payment

errors, particularly if a household switches to change reporting when

it is off a reservation. Accordingly, in 7 CFR 273.21(2)(ii), the

Department is proposing that a State agency may opt to continue the

two-year certification period for any household that moves off a

reservation. If the State agency adopts this option and the household

is still living off a reservation at recertification, the household

shall be subject to the certification period requirements in 7 CFR

273.10(f)(4). If the State agency does not adopt this option, any

household that moves off a reservation shall have its certification

period shortened. A household continuing to be subject to monthly

reporting shall not have its certification period shortened to less

than six months. A household becoming subject to change reporting shall

not have its certification period end any earlier than the month

following the month in [[Page 29769]] which the State agency determines

that the certification period shall be shortened.

Missing and Incomplete Monthly Reports

Section 101(a) of Pub. L. 103-225 (Section 6(c)(1)(C)(ii), 7 U.S.C.

2015(c)(1)(C)(ii)) prohibits a State agency from delaying, reducing,

suspending, or terminating the benefits of a household residing on a

reservation that submits a report not later than one month after the

end of the month in which the report is due. Normally, if a complete

monthly report is not received within the time frames specified in 7

CFR 273.21, the State agency would terminate the household. Under

Section 101(a) of Pub. L. 103-225, a State agency must now issue

benefits to a household residing on a reservation on its normal

issuance date even if it has failed to submit a monthly report. In

order to implement this provision, the Department is proposing in

Sec. 273.21(t)(3)(i) to require the State agency to provide a household

residing on a reservation which does not submit its monthly report by

the issuance date with the same benefit amount that the household

received the previous month. This issuance must be provided to the

household on the household's normal issuance date. If the household's

report is received prior to the issuance date, but too late to be

processed without delaying the household's issuance, the household

shall be issued its benefits on the normal issuance date.

The Department is also proposing in Sec. 273.21(t)(3)(ii) to

require a State agency to provide a household residing on a reservation

its benefits on the normal issuance date if the household submits an

incomplete monthly report that cannot be completed by the normal

issuance date. The State agency would be required to attempt to have

the household complete the report prior to the normal issuance date, in

accordance with the procedures in 7 CFR 273.21(j). Section 101(a) of

Pub. L. 103-225 does not address incomplete reports. However, the

legislative history indicates that the State agency should not take any

action against the household for failing to submit an incomplete

report. ``The purpose of this grace period is to provide ample

opportunity to resolve misunderstandings and ensure that households do

not suffer * * * when they unintentionally submit incomplete reports. *

* *'' Cong. Rec. S2905, March 11, 1994. Thus, the intent of the

legislation is to provide benefits even if an incomplete report has

been submitted.

The legislative intent of the grace period is to ensure that

households are not penalized for administrative reasons. Therefore, if

there is complete and verified information for some of the monthly

report, there is no reason for the State agency to not act on that

information. Such action would result in more accurate benefits being

provided to the household.

In enacting this legislation, Congress did not intend that

households residing on reservations participate indefinitely without

submitting monthly reports. ``Households that do not submit reports by

the end of the grace period would have their benefits suspended.''

Cong. Rec. S2905, March 11, 1994. Accordingly, the Department is

proposing in Sec. 273.21(t)(3)(iii) that if a household failed to

submit a monthly report or submitted an incomplete monthly report that

was never completed and then fails to submit the next consecutive

monthly report or submits an incomplete report for the next consecutive

monthly report that is not completed by the issuance date, the

household would be terminated in accordance with the provisions in 7

CFR 273.21(m).

In Sec. 273.21(t)(3)(iii), the Department is also proposing that

the household would not be terminated if it fails to ever submit or

complete the first missing monthly report so long as it submits the

next report by the end of the month in which it is due. The intent of

the grace period is to prevent interruptions in benefits for

administrative reasons. Receipt of old information as opposed to more

current information does not serve the purpose of requiring monthly

reports on household circumstances. To require that the missing or

incomplete report be submitted/completed at the same time as requiring

the next month's monthly report would be confusing to the households.

It would also be an unnecessary administrative burden to require the

State agency to process the missing report.

Benefit Determination

Despite the one-month grace period provided to households residing

on reservations to submit monthly reports by Section 101(a) of Pub. L.

103-225

(7 U.S.C. 2015(c)(1)(C)(ii)), it is the intent of Congress that

benefits be issued based on actual household circumstances. Cong. Rec.

S2905, March 11, 1994. Therefore, to the extent possible, incomplete

reports should be completed prior to the issuance of benefits. The

Department is proposing that State agencies follow the procedures in 7

CFR 273.21(j)(1) (i) through (v) to attempt to obtain a complete report

prior to the issuance date. The Department is proposing in

Sec. 273.21(t)(4) that the State agency repeat the previous month's

benefit amount if a report is not received by the issuance date. In

addition, the Department is proposing in Sec. 273.21(t)(4) that the

State agency issue the household's benefits based on the previously

submitted report without regard to any changes in the household's

circumstances that were not completed or verified. Finally, the

Department is proposing in Sec. 273.21(t)(4) that the State agency

adjust the amount of the benefits issued if there is any information on

the incomplete report that can be used as submitted. As discussed

earlier, the grace period was established to ensure that households

were not penalized for administrative reasons. However, there is no

reason for the State agency not to adjust benefits to reflect

information that is complete and verified.

Reinstatement

Section 101(a) of Pub. L. 103-225 (7 U.S.C. 2015(c)(1)(C)(i))

provides that, if a household is terminated for failing to submit or to

complete a monthly report, the household shall be reinstated without

being required to submit a new application if a monthly report is

received no later than the last day of the month following the month

the household was terminated. Accordingly, the Department is proposing

at Sec. 273.21(t)(5) to require that a State agency reinstate a

household terminated in accordance with Sec. 273.21(t)(3)(iii) without

the household's being required to submit a new application if a monthly

report is received no later than the last day of the month following

the month the household was terminated.

Notices

The changes proposed above that provide for separate and different

treatment of monthly reporting households residing on reservations

require the notice requirements contained in 7 CFR 273.21(j)(2) to be

modified for these households. The intent of Congress is that State

agencies provide all the notices currently required for monthly

reporting households in 7 CFR 273.21(j)(2), modified as necessary to

reflect the alternative termination and reinstatement impacts for

missing and incomplete reports. Cong. Rec. S2905, March 11, 1994.

Accordingly the Department is proposing in Sec. 273.21(t)(6) modified

notice requirements. [[Page 29770]]

In Sec. 273.21(t)(6)(i), the Department is proposing that all

notices regarding changes in a household's benefits meet the definition

of adequate notice as defined in 7 CFR 271.2. This will ensure that

households receive due process in any action that may negatively impact

their Food Stamp Program participation.

The Department is proposing in Sec. 273.21(t)(6)(ii) that the State

agency provide a notice to the household about missing or incomplete

reports that requests that the household take the action necessary to

submit the missing report or to complete an incomplete report. The

notification requirements are the same as those in 7 CFR 273.21(j)(3)

except that the notice shall advise the household that, if a report is

not submitted or if information provided on the incomplete report is

not completed or verified as required, the household's benefits would

be issued based on the previous month's circumstances.

In order to ensure that the household receives adequate notice of

any State agency action affecting the household's benefits, the

Department is proposing in 7 CFR 273.21(t)(5)(iii) that the State

agency notify a household, if its report has not been received or if it

is incomplete, simultaneously with the issuance that the benefits being

provided are based on the previously submitted report and that this

benefit does not reflect any changes in the household's circumstances

that have not been reported or verified as required. This notice shall

also advise the household that, if the next monthly report is not filed

timely and completely, the household will be terminated. This notice

requirement conforms notice requirements for these special

circumstances with current notice requirements for monthly reporting.

Under current regulations at 7 CFR 273.21(m), if a household does

not submit a complete monthly report, that household is required to be

terminated. Under Section 6(c)(1)(C)(i) and (ii) of the Act, as amended

by Section 101(a) of Pub. L. 103-225, households residing on

reservations were granted a grace period of one month for non-submittal

of a complete monthly report. However, if a household residing on a

reservation does not submit a monthly report in the consequent month as

well or submits an incomplete report, that household is required to be

terminated. In order to ensure that the household is aware of the

termination and its right to reinstatement, the Department is proposing

in 7 CFR 273.21(t)(6)(iv) that, if the household is terminated in the

consequent month, the State agency shall send the notice so the

household receives it no later than the date benefits would have been

received. This notice shall advise the household of its right to

reinstatement if a complete monthly report is submitted by the end of

the month following termination. This notice requirement is consistent

with current notice requirements for monthly reporting.

Supplements and Claims

As noted above, the Department is not proposing to require that

households submit the missing report simultaneously with the submittal

or after the submittal of the consequent monthly report. Nevertheless,

a household's report may be submitted or completed after the

household's issuance has been provided. In this circumstance, the

intent of Congress is that the State agency would take action based on

the eligibility factors contained in the monthly report when it is

submitted. Cong. Rec. S2905, March 11, 1994. Therefore, the Department

is proposing in 7 CFR 273.21(t)(7) that, if the household submits or

completes a monthly report after the issuance date but in the issuance

month, the State agency provide the household with a supplement if

warranted. Also, if the household submits or completes a monthly report

or the State agency becomes aware of a change that would have decreased

benefits in some other manner at any time after the issuance date, the

Department is proposing that the State agency file a claim for any

benefits overissued. The Department is not proposing that households

which submit reports after the issuance month receive restored

benefits. This is consistent with current food stamp policy in 7 CFR

273.17(a) which provides for restored benefits whenever the loss was

caused by an error by the State agency or by an administrative

disqualification which was subsequently reversed. Under current

regulations, restored benefits are not provided for losses caused by a

household error. Failure to submit a complete monthly report is a

household error.

Quality Control Procedures

The legislative history provides that ``a State [agency] will not

be adversely affected in regard to its quality control efforts related

to those households whose monthly reports are not submitted until a

month after the report is due.'' Cong. Rec. S2905, March 11, 1994. To

implement this provision, the Department is proposing that those

certification errors attributable to missing or incomplete monthly

reports covered under the grace period of this legislation shall be

excluded from the error determination process.

Implementation

The Food Stamp Program Improvements Act of 1994 was effective upon

enactment, March 25, 1994. On March 31, 1994, the Department issued a

memorandum notifying State agencies of the provisions of the

legislation and the March 25, 1994, effective date. State agencies were

directed to implement the requirements immediately. Recognizing that

the statutory amendments regarding the monthly reporting on

reservations have already been implemented through the above described

memorandum and in order to provide for the orderly implementation of

the specific provisions of this proposed rule, the Department is

proposing to require that this rule be effective in any given State

upon implementation by the State agency but in no event later than the

first day of the month 60 days after publication of the final rule.

Variances resulting from implementation of this provision would be

excluded from the payment error rate for 120 days from the required

implementation date, in accordance with section 13951 of Pub. L. 103-

66, which amended section 16(c)(3)(A) of the Act, 7 U.S.C.

2025(C)(3)(A).

List of Subjects in 7 CFR Part 273

Administrative practice and procedures, Aliens, Claims, Food

stamps, Grant programs--social programs, Penalties, Reporting and

recordkeeping requirements, Social security, Students.

Accordingly, 7 CFR part 273 is proposed to be amended as follows:

1. The authority citation of part 273 continues to read as follows:

Authority: 7 U.S.C. 2011-2032.

PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS

2. In Sec. 273.21, a new paragraph (t) is added to read as follows:

Sec. 273.21 Monthly Reporting and Retrospective Budgeting (MRRB).

* * * * *

(t) Monthly reporting requirements for households residing on

reservations. The following procedures shall be used for households

which reside on reservations and are required to submit monthly

reports:

(1) For purposes of this section, the term ``reservation'' shall

mean the geographically defined area or areas over which a tribal

organization exercises governmental jurisdiction. The

[[Page 29771]] term ``tribal organization'' shall mean the recognized

governing body of an Indian tribe (including the tribally recognized

intertribal organization of such tribes), as well as any Indian tribe,

band, or community holding a treaty with a State government.

(2) Certification periods. Any household residing on a reservation

that is required to submit a monthly report shall be certified for two

(2) years.

(i) A State agency may request a waiver from FCS to allow it to

establish certification periods of less than two (2) years if it is

able to justify the need for the shorter periods. Any request for a

waiver shall include input from the affected Indian tribal

organization(s) and quality control error rate information for the

affected households.

(ii) The State agency may opt to continue the two-year

certification period for any household that moves off the reservation.

If the State agency adopts this option and the household is still

living off the reservation at the time it is subject to required

recertification, the household shall be subject to the certification

period requirements in Sec. 273.10(f)(4). If the State agency does not

adopt this option, any household that moves off the reservation shall

have its certification period shortened. A household continuing to be

subject to monthly reporting shall not have its certification period

shortened to less than six months. A household becoming subject to

change reporting shall not have its certification period end any

earlier than the month following the month in which the State agency

determines that the certification period shall be shortened.

(3) Missing and incomplete reports. The State agency shall take the

following actions when a household residing on a reservation fails to

submit a monthly report or complete a monthly report the State agency

has indicated is incomplete:

(i) Failure to submit a monthly report by the issuance date. If a

household does not submit its monthly report by the issuance date, the

State agency shall provide the household with the same issuance that

the household received the previous month. This issuance must be

provided to the household on the household's normal issuance date. If

the household's monthly report is received prior to the issuance date,

but too late to be processed without delaying the household's issuance,

the household shall be provided its issuance on the normal issuance

date.

(ii) Failure to submit a complete monthly report by the issuance

date. If a household does submit its monthly report prior to the

issuance date, but that report is incomplete, the State agency shall

attempt to have the household complete the report prior to the normal

issuance date, in accordance with the procedures in paragraph (j) of

this section. If the report cannot be completed by the normal issuance

date, the State agency shall provide the household its issuance on the

normal issuance date.

(iii) Failure to submit two consecutive monthly reports or to

complete two consecutive monthly reports. If a household failed to

submit a monthly report or submitted an incomplete monthly report that

was never completed and then fails to submit the next consecutive

monthly report or submits an incomplete report that is not completed by

the issuance date, the household shall be terminated in accordance with

the provisions in paragraph (m) of this section. The household shall

not be terminated if it fails to ever submit or complete the first

missing monthly report but does submit a completed report for the

following month.

(4) Benefit determination. If a household's report is not completed

by the issuance date, the State agency shall issue the household's

benefits based on the previously submitted report without regard to any

changes in the household's circumstances that were not completed or

verified. The State agency shall adjust the benefits issued if there is

any information on the incomplete report that can be used as submitted.

(5) Reinstatement. If a household is terminated for failing to

submit or to complete a monthly report, the household shall be

reinstated without being required to submit a new application if a

monthly report is submitted no later than the last day of the month

following the month the household was terminated.

(6) Notices.

(i) All notices regarding changes in a household's benefits shall

meet the definition of adequate notice as defined in Sec. 271.2 of this

chapter.

(ii) If a household fails to file a monthly report, or files an

incomplete report, by the specified filing date, the State agency shall

notify the household within five days of the filing date:

(A) That the monthly report is either overdue or incomplete;

(B) What the household must do to complete the form;

(C) If any verification is missing;

(D) That the Social Security number of a new member must be

reported, if the household has reported a new member but not the new

member's Social Security number;

(E) What the extended filing date is;

(F) That the State agency will assist the household in completing

the report; and

(G) That the household's benefits will be issued based on the

previous month's submitted report without regard to any changes in the

household's circumstances if the missing report is not submitted or if

incomplete or unverified information on the incomplete report is not

completed or verified as required.

(iii) Simultaneously with the issuance, the State agency shall

notify a household, if its report has not been received or if it is

incomplete, that the benefits being provided are based on the previous

month's submitted report and that this benefit does not reflect any

changes in the household's circumstances. This notice shall also advise

the household that, if a complete report is not filed timely, the

household will be terminated.

(iv) If the household is terminated, the State agency shall send

the notice so the household receives it no later than the date benefits

would have been received. This notice shall advise the household of its

right to reinstatement if a complete monthly report is submitted by the

end of the month following termination.

(7) Supplements and claims. If the household submits or completes a

monthly report after the issuance date but in the issuance month, the

State agency shall provide the household with a supplement if

warranted. If the household submits or completes a monthly report after

the issuance date or the State agency becomes aware of a change that

would have decreased benefits in some other manner, the State agency

shall file a claim for any benefits overissued.

Dated: May 26, 1995.

William E. Ludwig,

Administrator, Food and Consumer Service.

[FR Doc. 95-13723 Filed 6-5-95; 8:45 am]

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