Budgeting Procedures

The policy regarding determining the amount of court ordered child support to use is not changed.  Use prior payment history as an indicator of future child support payments.  Average a series of past monthly payments to determine the anticipated amount of future payments.  Workers should use their judgment as to the amount of child support to budget when the EU just began making payments or there is no prior history of payments.

The budgeting procedure is changed.  To determine if an EU is eligible based on the gross income (130% of FPL) test, complete the following steps:

• determine total gross income for the EU;
• subtract farm loss, if applicable;
• subtract court ordered child support paid to an individual outside the EU; and
• compare the adjusted gross income to 130% of FPL for the EU size.

• determine the total gross earned income;
• subtract the 20% earned income deduction;
• add the total gross unearned income;
• subtract farm loss, if applicable;
• subtract court ordered child support paid to an individual outside the EU;
• subtract the standard deduction according to the EU size;
• subtract the child care expense, medical expense, and excess shelter expense, as applicable; and
• compare the net income to the net income maximum.

• Ineligible EU Members Paying Court Ordered Child Support

Court ordered child support paid by an ineligible EU member (other than an ineligible student) is deducted from the ineligible individual's income.  Ineligibility occurs when an EU member:

• fails to obtain or refuses to provide an SSN,
• is ineligible due to immigration status,
• is subject to and not meeting the 18 to 50 year old work requirement, or
• is sanctioned for failure to comply with a required action for a means-tested public assistance program.

The FAMIS regular budget process (in the controlled flow or maintenance mode) does the calculation and prorates the income and expenses.  The FAMIS WIBCA budget process does not complete the calculation or prorate the income and expenses.  Use the procedures outlined in the next paragraph for WIBCA and Legacy budgeting process.

Legacy does not have the capability to determine the amount of prorated income and expenses to use toward the remaining EU members.  Therefore the determination must be done offline.  To determine the correct amount of income and expenses, compute the earned income of the ineligible member and deduct the 20% earned income deduction.  Add the unearned income to the earned income.  Subtract the court ordered child support from the income.  Prorate the remaining income over the EU members.

Child Support Expense is Less than Income of the Ineligible EU Member

EXAMPLE: The R family consists of four individuals.  Mr. R is an ineligible immigrant. Mr. R has earned income of $1000, unearned income of $100, and pays $500 court ordered child support.  Manually compute Mr. R's income then prorate the remaining income to determine the amount to budget/enter for the EU.  The manual computation looks like this:
 

Mr. R's earned income -	$1000
Less 20% earned income deduction -	- 200
	$ 800
Mr. R's unearned income -	+100
	$ 900
Court ordered child support -	- 500
Mr. R's income -	$ 400
Divide the $400 over 4 EU members -	$ 100
Multiply by number of eligible EU members -	x   3
	$ 300

Child Support Expense Exceeds the Income of the Ineligible EU Member

If the court ordered child support exceeds the income of the ineligible individual, any remaining child support is deducted from the gross income for the remaining EU members when determining eligibility based on 130% of FPL.  When completing an FEXP in Legacy, enter the remaining child support amount in the child support field.  Also, enter the remaining child support in FBCA, child support expense field.

EXAMPLE: The S family consists of four individuals.  Mr. S chose not to provide his Social Security number and is ineligible to receive food stamp benefits for himself.  Mr. S has earned income of $1000, unearned income of $100, and pays $1000 court ordered child support.  Manually compute Mr. S's income then prorate the remaining income to determine the amount to budget/enter for the EU.  The manual computation looks like this:
 

Mr. S's earned income -	$1000
Less 20% earned income deduction -	- 200
	$ 800
Mr. S's unearned income -	+ 100
	$ 900
Court ordered child support -	-1000
Mr. S's income -	- 100

• Disqualified Individual

When an individual is sanctioned or disqualified from receiving food stamp benefits, count all income, resources, and expenses of the disqualified individual. 

The child support is excluded from the gross income for the EU.

• Child Support Paid by EU Member With Excluded Income

When the only income of the EU member paying child support is excluded because of the type of income it is and that same EU member is paying court ordered child support, the child support payment is deducted from the income of the remaining EU members.

EXAMPLE: Mrs. T is a full-time student and her only source of income is Federal Financial Assistance under Title IV.  Mr. T receives unemployment compensation of $600 per month.  Mrs. T is paying court ordered child support of $200 per month.  Since Mrs. T's student income is excluded, the court ordered child support she pays is excluded (deducted) from Mr. T's income.
 
 

Mrs. T's income -	$    0
Mr. T's income -	+600
	$600
Mrs. T's child support expense -	- 200
Gross income	$400

• Child Support Paid by EU Member Whose Income is Excluded due to the Individual's Status

When the only income of the EU member paying child support is excluded because of the status of the individual (ineligible student or duplicate participation), the child support payment is not excluded or deducted from the income of the remaining EU members.

EXAMPLE: Mrs. U is an ineligible student and her only source of income is wages from a part-time job.  Mr. U receives unemployment compensation of $600 per month.  Mrs. U is paying court ordered child support of $200 per month.  Since Mrs. U's income is excluded because she is an ineligible student, the court ordered child support she pays is not excluded (deducted) from Mr. U's income.
 
 

Mrs. U's income -	$    0
Mr. U's income -	+600
	$600
Child support expense -	-  0
Gross income	$600

Do not budget the court ordered child support expense if it is not verified that it is court ordered or that it is paid.  Pend an application for thirty days if the expense is not verified.  On the 30th day, if verification is not received, complete the application without the expense.  FAMIS automatically completes the application if no other verification is needed and the controlled flow is complete.  If the application is in Legacy, the worker must take action to complete the application, if all other verification is received.

Income Reporting Requirement

EUs subject to simplified reporting must report when their gross monthly income less court ordered child support paid exceeds 130% of FPL.  The worker must enter the gross income maximum plus court ordered child support on the approval notice and adjustment notices sent to the EUs not converted to FAMIS.

EXAMPLE: The U family consists of two individuals.  Mr. U applied and was approved to receive food stamps for six months as a simplified reporting EU.  Mr. U pays $300 in court ordered child support.  The 130% of FPL for a two person EU is $1294.  The worker notifies the EU that they must report when their income exceeds $1594 per month.

Legacy Programming Changes

Changes are made to Legacy FEXP, FBCA, and FSU5 to correctly exclude the court ordered child support expense when determining eligibility based on the gross income limit (130% of FPL) for March 2003 and later and when screening for expedited eligibility for March 2003 and later.  The changes are explained in more detail below.

• FEXP changes: A new field, Child Support Expense, is added to FEXP in the expense section.  For applications taken March 10, 2003, and later, enter the court ordered child support paid by the EU in this field.  FEXP subtracts the expense from the amount of gross income the worker enters in the Income field.  After the worker presses enter to commit the data, the amount of income is changed to the new gross income amount (gross income entered by worker less court ordered child support).  The Income amount cannot be less than $0.  The Income amount is then added to the resource amount and entered in the Total Income/Resources field.

• FBCA Changes: There are no screen/field changes to FBCA, however the calculation is different therefore some of the amounts that are system-entered look different.

• On the first screen of FBCA (top half of the printout), after the worker enters the information and presses enter, the total GROSS INC (Income) displays the EU's gross income less the child support expense when determining if the EU is eligible on the gross test.

• On the budget screen of FBCA (lower half of the printout), the LESS CS EXPENSE field is still on the right side of the budget.  However, the expense is deducted behind the scenes on the left side of the budget.  The TOTAL F.S. INCOME is all included income less the earned income deduction, farm loss, and court ordered child support expense.

NOTE: EUs that pay court ordered child support and are over the gross income limit for February 2003 may be under the gross income limit for March 2003.  Complete an FBCA for March 2003 prior to rejecting the application or closing the case to see if the EU is eligible under the new policy.  If the EU is eligible, transfer the March 2003 FBCA data to FSU5.

• FSU5 Changes: FSU5 is changed to exclude the court ordered child support expense from the gross income. The child support expense entered in field 13 is excluded from the income entered in field 13.  The amount of income shown in field 13 does not change.

Changes are made to FAMIS regular budget process and WIBCA to correctly exclude the court ordered child support expense when determining eligibility based on the gross income limit (130% of FPL) for March 2003 and later and when screening for expedited eligibility for March 2003 and later.  The changes are explained in more detail below.

• Expedited Screening (FM48): The Monthly Income shows the total gross income for the EU less court ordered child support expense.

• Food Stamp Budget Summary (FM4A): The following changes are made to the screen:

• The Gross Income on the left side of the budget displays the EU's gross income less the child support expense.  This amount is compared to the Gross Income Max appearing on the right side of the budget.

• The Court Ordered field is moved from the right side of the budget calculation to the left.  The court ordered child support is deducted from the gross income.  The Total Income is all included income less the earned income deduction, farm loss, and court ordered child support expense.

• For special circumstances, the screen may or may not display the entire amount of court ordered child support the worker entered on the Court Ordered Expense screen (FMXL).

• If the individual who pays the court ordered child support is ineligible and his/her income is prorated, the child support is deducted from the income during the proration calculation.  The expense appears on this screen only if the expense exceeds the individual's income and the remainder can be deducted from the income for the rest of the EU.

• If the individual who pays the court ordered child support is an ineligible student or has duplicate participation for the month, no expense appears on this screen.

• WIBCA: There are no screen/field changes to the first screen of WIBCA (FMXN).  On the WIBCA budget screen (FMXP), the Court Order Exp is moved from the right side of the budget to the left, and renamed Court Ordered.  The Gross Income in the lower section of the screen displays all included income less farm loss and court ordered child support expense.

The Food Stamp Manual revisions are being made and will be available upon completion.

• Review this memorandum with all necessary staff.

• Implement this policy March 10, 2003.