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

DEPARTMENT OF AGRICULTURE

7 CFR Parts 272 and 273

[Amendment No. 365]

RIN 0584-AB98

Food Stamp Program: Monthly Reporting on Reservations Provision

of the Food Stamp Program Improvements Act of 1994

AGENCY: Food and Consumer Service, USDA.

ACTION: Final rule.

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SUMMARY: This final rulemaking amends 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. It finalizes

provisions of a proposed rule published in the Federal Register on June

6, 1995.

DATES: This rule is effective December 16, 1996 and must be implemented

no later than the first day of the first month after February 18, 1997.

FOR FURTHER INFORMATION CONTACT: Margaret Werts Batko, Assistant Branch

Chief, Certification Policy Branch, Program Development Division, Food

Stamp Program, Food and Consumer Service, USDA, 3101 Park Center Drive,

Alexandria, Virginia 22302, or by telephone at (703) 305-2520, or over

the internet at [email protected].

SUPPLEMENTARY INFORMATION

Executive Order 12866

This final 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 final 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 rulemaking 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 final 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

[[Page 54299]]

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

Information collection burdens in 7 CFR 273.21 governing reporting

and recordkeeping requirements for monthly reporting and retrospective

budgeting were approved by the Office of Management and Budget (OMB)

under OMB No. 0584-0064. The provisions contained in this final rule

change the content of certain notices to households, but would not

impose any additional or reduce any current reporting and recordkeeping

burden requirements. Since this final rule is placing into effect

through formal rulemaking an information collection burden already

approved, this rule has no effect on the existing burden estimates. FCS

will publish a notice in the Federal Register explaining in detail why

the information collection burden approved under OMB No. 0584-0064 is

not affected and providing a 60-day period for public comment on the

existing burden estimates. As required by the Paperwork Reduction Act

of 1995, FCS will submit an Information Collection Request to OMB for

extension of OMB No. 0584-0064 addressing any comments received.

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 (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 other pieces of legislation have been

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, 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 provision prohibiting 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 the Earned Income Tax Credit Amendment final

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

establishing new monthly reporting requirements for households residing

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

25, 1994.

On June 6, 1995 at 60 FR 29767, the Department proposed regulations

that would address 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 proposal was to establish the following requirements for 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.

The Department provided the public 60 days to comment on the

regulatory proposals. For additional information on the provisions of

this rule, the reader should refer to the preamble of the proposed

rule, 60 FR 29767-70. The Department received two comments on the

proposed rule, both from State agencies. Both commenters opposed the

rule as proposed; one of the commenters offered alternative procedures.

These comments are discussed below.

Definition of Residing on a Reservation

Section 3(j) of the Act (7 U.S.C. 2012(j)) defines a reservation as

``the geographically defined area or areas over which a tribal

organization (as that term is defined in subsection (3)(p)) exercises

governmental jurisdiction.'' Section 3(p) (7 U.S.C. 2012(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 101(a)

of Pub. L. 103-225 did not modify the Act's definition of a reservation

or tribal organization. The Department proposed in Sec. 273.21(t)(1) to

adopt these definitions for the purpose of determining whether a

household is residing on a reservation. One commenter opposed these

definitions because the boundaries of the reservations in his State did

not correspond to geographic and ZIP code systems used by the State

agency in its certification process. That commenter wanted to allow

applicants and recipients to indicate to State agencies whether they

resided on reservations and also wanted State agencies to not be

responsible for inaccurate recipient indications of residency. The

Department has no discretion in the definition of a reservation, since

the term is described in the Act. Therefore, the Department is adopting

Sec. 273.21(t)(1) as proposed.

The regulation does not establish any proscriptive requirements on

a State agency for determining residency on a reservation. Therefore, a

State agency is free to establish its own method for establishing

residency. However, existing quality control procedures would be used

to determine whether a variance existed in a household's actual as

opposed to claimed residency. The definition of a reservation used in

the quality control procedure would be the definition in the

regulations at 7 CFR 271.2.

[[Page 54300]]

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 year certification periods for households

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

U.S.C. 2015(c)(1)(C)(iv)). 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 years if the State agency can

show good cause for a shorter certification period. The Department

proposed in Sec. 273.21(t)(2) that State agencies certify households

residing on reservations subject to monthly reporting for two years; in

Sec. 273.21(t)(2)(i), that a State agency may request a waiver from FCS

to allow it to establish shorter certification periods for those

households; and in Sec. 273.21(t)(2)(ii), that a State agency may, for

administrative ease, opt to continue the two-year certification period

for any household that moves off a reservation. The Department did not

receive any comments on these provisions. Accordingly, the Department

is adopting Sec. 273.21(t)(2) as proposed.

Missing and Incomplete Monthly Reports

Section 101(a) of Pub. L. 103-225 (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, a 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 the household has

failed to submit a monthly report. In order to implement this

provision, the Department proposed in Sec. 273.21(t)(3)(i) to require a

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 Department proposed that the household be

issued its benefits on the normal issuance date.

In Sec. 273.21(t)(3)(ii), the Department proposed to require a

State agency to provide benefits to a household residing on a

reservation on the normal issuance date if the household submitted an

incomplete monthly report that could not 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).

The Department proposed 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 fully completed and then failed to submit

the next consecutive monthly report or submitted an incomplete report

for the next consecutive monthly report that was not subsequently

completed by the issuance date, the household's participation would be

terminated in accordance with the provisions in 7 CFR 273.21(m). Also

in Sec. 273.21(t)(3)(iii), the Department proposed that the household

would not be terminated if it failed to ever submit or complete the

first missing monthly report so long as it submitted the next report by

the end of the month in which it was due.

The Department received one comment on the proposed provisions in

Sec. 273.21(t)(3). That commenter opposed the proposal as complicated,

cumbersome, and costly. Further, the commenter believed that the

proposal was contrary to the Department's efforts to improve program

integrity and promote personal responsibility. The State agency

commenting had already implemented the provision. In its implementation

it was requiring the household to submit the missing report prior to

any subsequent issuance after the initial grace month issuance. If the

missing report was not submitted by the end of the issuance (or grace)

month, the household would be terminated. The household would not be

reinstated unless it submitted the missing report by the end of month

following the issuance month.

In light of this comment, the Department has decided to revise the

proposed procedures significantly. These revisions are consistent with

the Department's goals to increase administrative flexibility for State

agencies. Therefore, the Department is replacing the proposed

Sec. 273.21(t)(3) with the following language which essentially tracks

the language of Section 6(c)(1)(C)(ii) of the Act: ``The State agency

shall not delay, reduce, or suspend the allotment of a household that

fails to submit a report by the issuance date.'' Each State agency will

be responsible for deciding what report must be submitted--either the

missing report [as the commenter suggested] or the next month's report

[as was proposed]. The State agency shall make that decision based on

what it believes is most appropriate for recipients and most

administratively feasible for that State. Additionally, each State

agency may unilaterally decide whether to consider a report received

too late to act on or an incomplete report as ``submitted'' for

purposes of this provision.

Benefit Determination

The Department proposed in Sec. 273.21(t)(4) that, in appropriate

instances, a State agency repeat the previous month's benefit amount if

a report is not received by the issuance date of the next month's

allotment. In addition, the Department proposed in Sec. 273.21(t)(4)

that a 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 completely reported on or

verified. Finally, the Department proposed in Sec. 273.21(t)(4) that a

State agency adjust the amount of the benefits issued if there was any

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

Department received one comment addressing the requirement in

Sec. 273.21(t)(4) to issue the previous month's benefit amount if a

report is not received by the issuance date. That commenter opposed the

proposal because it provided unequal treatment to households required

to monthly report based on whether they lived on or off a reservation.

The Department has no discretion in this requirement. Section 101(a)(2)

of Pub. L. 103-225 (7 U.S.C. 2015(c)(1)(C)(ii)) requires that the State

agency 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; i.e., the State agency must

issue benefits on the issuance date although a monthly report has not

been received.

As discussed above in the section of the preamble concerning

missing and incomplete reports, a commenter opposed the requirements in

Sec. 273.21(t)(3) to issue benefits when a report was incomplete. That

commenter also opposed the requirement in proposed Sec. 273.21(t)(4)

that State agencies act on information that would otherwise be

considered incomplete. The Department has decided not to adopt

Sec. 273.21(t)(4) as proposed. The

[[Page 54301]]

revisions in Sec. 273.21(t)(3), as adopted herein, specify that

benefits not be delayed, reduced, suspended, or terminated. Thus, each

State agency is required by that provision to issue benefits on the

household's normal issuance date if it fails to submit a monthly

report. Each State agency may decide whether to adjust benefits for

completed information on an otherwise incomplete report. Final

Sec. 273.21(t)(3) will consist of proposed (t)(3) and (t)(4), with the

modifications discussed herein.

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 issuance

month. The Department proposed 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 being required to submit a

new application if a complete monthly report was received no later than

the last day of the month following the month the household was

terminated. One comment was received, opposing the provision as

proposed. The Department has modified the proposed rule in light of the

comment discussed above. The final rule on this is being renumbered

Sec. 273.21(t)(4) as opposed to (t)(5) to reflect the decision not to

adopt as final proposed Sec. 273.21(t)(4) discussed above. The phrase

``or to complete'' is being removed from the proposal in this final

rule. Removing this phrase reflects the options regarding reports

available to the State agency as discussed above.

Notices

In Sec. 273.21(t)(6)(i), the Department proposed that all notices

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

adequate notice as defined in 7 CFR 271.2. The Department also proposed

in Sec. 273.21(t)(6)(ii) that State agencies provide notice to

households about missing or incomplete reports requesting that the

household take the action necessary to submit the missing report or to

complete an incomplete report. In order to ensure that a household

receives adequate notice of any State agency action affecting the

household's benefits, the Department proposed in Sec. 273.21(t)(5)(iii)

that simultaneously with the issuance of benefits the State agency

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

incomplete. The household should also be informed that the benefits

being provided are based on the previously submitted report and that

the amount of the allotment does not reflect any changes in the

household's circumstances from the previous issuance. Further, this

notice would advise the household that, if the next monthly report was

not filed timely and completely, the household would be terminated. The

proposed notice requirement conformed notice requirements for these

special circumstances with current notice requirements for monthly

reporting. Finally, in order to ensure that the household would be

aware of the termination and its right to reinstatement, the Department

proposed in Sec. 273.21(t)(6)(iv) that, if the household is terminated

in the consequent month, the State agency would send the notice so the

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

received. This notice would be required to advise the household of its

right to reinstatement if a complete monthly report was submitted by

the end of the month following termination. This proposed notice

requirement was consistent with current notice requirements for monthly

reporting.

The Department did not receive any comments on the notice

requirements. However, to be consistent with the modifications made

above, the Department is modifying the requirements in the final rule

to eliminate references to an incomplete report. The Department is

adopting the provision as proposed except for this modification.

Supplements and Claims

The Department proposed in Sec. 273.21(t)(7) that, if the household

submitted or completed a monthly report after the issuance date but in

the issuance month, the State agency would provide the household with a

supplement, if warranted. Also, if the household submitted or completed

a monthly report or the State agency became aware of a change that

would have decreased benefits in some other manner at any time after

the issuance date, the Department proposed that the State agency file a

claim for any benefits overissued. The Department did not propose that

households which submit reports after the issuance month receive

restored benefits.

The Department received one comment on proposed Sec. 273.21(t)(7).

The commenter did not oppose the claims provision. The commenter

opposed the proposal to provide a supplement when the monthly report is

received during the issuance month. The commenter believes that 7 CFR

273.12(c)(1)(i) conflicts with the proposed requirement to provide a

supplement, and the commenter preferred the option in 7 CFR

273.12(c)(1)(i) to provide increases in the following month, where

warranted. That commenter also opposed providing supplements to these

households as undermining the reporting requirements and diminishing

household responsibility for reporting.

The Department disagrees with the commenter. Section

273.12(c)(1)(i) is not applicable in this situation. The proposed

provision is a special provision that takes precedence over 7 CFR

273.12(c)(1)(i). The provision for providing supplements as well as for

establishing claims provides for equitable and consistent treatment of

late reported information. The Department recognizes that Section

101(a) of Pub. L. 103-225 was intended to provide special treatment to

the households residing on reservations. For that reason, the

Department is adopting the regulation as proposed. State agencies must

provide supplemental benefits if a missing report is submitted during

the issuance month. The commenter was concerned about which report

would require a supplement to be issued--the missing report for the

month for which benefits were issued or the subsequent month's report

that would be due in the issuance month. The proposal has been revised

to clarify that it only applies to the missing report and not the

subsequent report for the following month.

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.'' Congressional Record. S2905, March 11,

1994. To implement this language, the Department proposed that those

certification errors attributable to missing or incomplete monthly

reports covered Section 101(a) of Pub. L. 103-225 shall be excluded

from the error determination process. One commenter requested

clarification of how quality control would handle two situations: (a)

the household deliberately withholds a monthly report because they know

the information would make them ineligible; and (b) the month prior to

the incomplete or missing monthly report is a month in which the

household either receives too many or too few food

[[Page 54302]]

stamps. The following quality control procedures apply to cases subject

to the provisions of this rulemaking and with a review date that falls

within the grace period: certification errors that occur during the

grace period would be excluded; certification errors occurring prior to

the grace period would be reviewed in accordance with existing

procedures in the FCS Handbook 310.

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 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 proposed 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 first month 60 days after

publication of the final rule. The Department did not receive any

comments on the implementation schedule as proposed. Accordingly, this

action amends 7 CFR 272.1(g) to add a new paragraph to address

implementation requirements for this final action.

Quality control variances resulting from implementation of the

remaining provisions of this final rule will be excluded for 120 days

from the required implementation date, in accordance with 7 CFR

275.12(d)(12), as modified by 7 U.S.C. 2025(c)(3)(A).

List of Subjects

7 CFR Part 272

Alaska, Civil rights, Food stamps, Grant programs-social programs,

Reporting and recordkeeping requirements.

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 Parts 272 and 273 are amended as follows:

1. The authority citations of Parts 272 and 273 continue to read as

follows:

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

PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES

2. In Sec. 272.1, a new paragraph (g)(150) is added to read as

follows:

Sec. 272.1 General terms and conditions.

* * * * *

(g) Implementation. * * *

(150) Amendment No. 365. This provision is effective December 16,

1996 and must be implemented no later than March 1, 1997. Any variances

resulting from implementation of the provisions of this amendment shall

be excluded from error analysis for 120 days from this required

implementation date in accordance with Sec. 275.12(d)(2)(vii) of this

chapter.

PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS

2a. 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) Definition of a reservation. 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 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) Benefit determination for missing reports. The State agency

shall not delay, reduce, or suspend the allotment of a household that

fails to submit a report by the issuance date.

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

submit 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.

(5) 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 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.

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

notify a household, if its report has not been received, 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.

[[Page 54303]]

(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.

(6) Supplements and claims. If the household submits the missing

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 the missing 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: July 15, 1996.

Ellen Haas,

Under Secretary for Food, Nutrition, and Consumer Services.

[FR Doc. 96-26071 Filed 10-16-96; 8:45 am]

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