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| Montana Administrative Register Notice 37-560 | No. 18 09/22/2011 | |
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BEFORE THE DEPARTMENT OF PUBLIC HEALTH AND HUMAN SERVICES OF THE STATE OF MONTANA
TO: All Concerned Persons 1. On October 12, 2011, at 10:00 a.m., the Department of Public Health and Human Services will hold a public hearing in Room 207 of the Department of Public Health and Human Services Building, 111 North Sanders, Helena, Montana, to consider the proposed amendment of the above-stated rules. 2. The Department of Public Health and Human Services will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact Department of Public Health and Human Services no later than 5:00 p.m. on October 3, 2011, to advise us of the nature of the accommodation that you need. Please contact Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; telephone (406) 444-4094; fax (406) 444-9744; or e-mail [email protected]. 3. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined: 37.70.406 INCOME STANDARDS (1) Households with one through (2) remains the same. (3) The table of income standards for households of various sizes for the (4) Households at or below AUTH: 53-2-201, MCA IMP: 53-2-201, MCA 37.70.408 RESOURCES (1) through (3) remain the same. (4) In state fiscal year (5) remains the same. AUTH: 53-2-201, MCA IMP: 53-2-201, MCA 37.70.601 BENEFIT AWARD (1) Except as provided in (2), the benefit matrices in (1)(c) and (1)(d) are used to establish the benefit payable to an eligible household for a full heating season. The benefit varies by household income level, type of primary heating fuel, the type of dwelling (single family unit, multi-family unit, mobile home), the number of bedrooms in the dwelling, and the heating districts in which the household is located, to account for climatic differences across the state. (a) and (b) remain the same. (c) The following table of base benefit levels takes into account the number of bedrooms in a house, the type of dwelling structure, and the type of fuel used as a primary source of heating: TABLE OF BENEFIT LEVELS (i) SINGLE FAMILY
(ii) MULTI-FAMILY
(iii) MOBILE HOME
(d) The following table is based upon the household's income as a percentage of the federal poverty guideline and adjusted for climatic differences in the ten human resource development council service areas in the state of
(2) remains the same. AUTH: 53-2-201, MCA IMP: 53-2-201, MCA 37.70.901 EMERGENCY ASSISTANCE (1) through (3) remain the same. (4) Emergency assistance payments may be made on behalf of the eligible household for actual costs necessary to alleviate the emergency. However, no emergency assistance payments will be made for costs which are the liability of a third party, unless the household assigns to the department in writing its rights to such third party payments. Emergency assistance payments are limited to a total of $250 per household in a 12-month period commencing on the first of October immediately preceding the date of the request for emergency assistance, except as follows: (a) An eligible household may receive emergency assistance payments which total more than $250 in a 12-month period if the local contractor determines (5) through (8) remain the same. AUTH: 53-2-201, MCA IMP: 53-2-201, MCA 4. STATEMENT OF REASONABLE NECESSITY
The Department of Public Health and Human Services (the department) is proposing the amendment of ARM 37.70.406, 37.70.408, 37.70.601, and 37.70.901 pertaining to Low Income Energy Assistance Program (LIEAP). LIEAP is a federally funded program to help low income households pay their home heating costs. The department proposes to make changes to its administrative rules governing LIEAP as follows:
ARM 37.70.406
Because LIEAP is a needs-based assistance program, only households with income below specified limits are eligible to receive LIEAP benefits. ARM 37.70.406 contains the maximum income standards used to determine eligibility for LIEAP. These income standards are computed as a specified percentage of the federal poverty guidelines (FPG) issued annually by the U.S. Department of Health and Human Services (HHS). The standards currently in ARM 37.70.406 are based on the FPG for 2009. ARM 37.70.406(1) currently provides that households with one through six members with annual gross income at or below 200% of the 2009 FPG qualify for LIEAP on the factor of income. HHS updates the FPG each year to take into account changes in the cost of living. The department periodically amends ARM 37.70.406 to provide that the most recent version of the FPG will be used to set the income standards because the most recent guidelines generally are higher than the guidelines for the previous year due to inflation. The income standards increase when the more recent, higher guidelines are used to compute them. Conversely, the income standards would not increase to reflect inflationary increases in the cost of living if the department continued to use the guidelines from a previous year. If the department did not use the most recent guidelines some households might be ineligible for benefits due to inflationary increases in the household's income that did not reflect an increase in actual buying power. Thus, the department proposes to amend ARM 37.70.406 to provide that the 2011 FPG rather than the 2009 FPG will be used, in order to avoid this result. ARM 37.70.406(1) currently provides that households with seven or more members are eligible if their annual gross income is at or below 75% of the estimated state median income (SMI) for federal fiscal year (FFY) 2011 for a household of that size. Like the FPG, SMI usually increases each year, so the department amends ARM 37.70.406 annually to provide that the current SMI will be used so that households will not be ineligible due to inflationary increases in the SMI that do not reflect increases in buying power. Therefore, the department proposes to amend ARM 37.70.406 to provide for the use of the estimated SMI for FY 2012 rather than 2011. In addition, the department proposes to reduce the maximum income a household may have in terms of the percentage of FPG or percentage of SMI due to a change in federal law. Since 1981, the federal law governing LIEAP at 42 U.S.C. 8624(b)(2)(B) has provided that eligibility for LIEAP must be limited to households whose income does not exceed 150% of the federal poverty level (FPL) or 60% of the state's median income (SMI), whichever is greater. However, in recent years LIEAP appropriation bills have contained language authorizing states to grant LIEAP benefits to households with income that does not exceed 200% of the FPL or 75% of the SMI, whichever is greater. ARM 37.70.406(1) currently sets the maximum income standards for households with one through six members at 200% of the guidelines because setting the income standards at a higher percentage of the FPG allows higher income households to qualify. For households of this size, 200% of the FPG was a lesser amount than 75% of the SMI, so the income standards did not exceed the upper limit set by the federal appropriation bill at that time. The department chose to use 200% of the FPG instead of 75% of the SMI for households of this size because federal regulations governing the Low Income Weatherization Assistance Program (LIWAP) limit eligibility to households whose income is at or below 200% of poverty. Currently the department's LIWAP rules provide that a household that is eligible for LIEAP is also eligible for LIWAP, but if the department set its LIEAP income standards at a level that was higher than 200% of the FPG it could not automatically grant LIWAP eligibility to all LIEAP households because the income of some LIEAP households would exceed the 200% of poverty limit for LIWAP. The department would therefore have to establish a separate process for determining eligibility for LIWAP, which was not desirable because it would create additional work and expense. For households with seven or more members, however, the department could not set the LIEAP income standards at 200% of the FPG because for these households 200% of poverty exceeded 75% of the SMI and hence the income standards would have exceeded the maximum amount allowed by the federal appropriation bill. Thus, for households with seven or more members the department set the maximum income standards at 75% of the estimated SMI for FFY 2011, the maximum amount permitted by federal law at that time. However, P.L. 112-10 enacted on April 15, 2011 did not contain language allowing households with income up to 200% of the FPL or 75% of the SMI to receive LIEAP benefits, nor does the appropriations bill now pending in Congress contain such language. Thus, the limits specified in 42 U.S.C. 8624(b)(2)(B), namely that household income may not exceed 150% of the FPL or 60% of SMI, whichever is greater, once again apply. Therefore, in order to comply with the requirements of 42 U.S.C. 8624(b)(2)(B), the department must amend ARM 37.70.406(1) to provide that households consisting of one through seven members are income-eligible for LIEAP benefits if the household's gross annual income is at or below 60% of the estimated SMI for federal fiscal year 2012. For households of eight or more members, the household's gross annual income must be at or below 150% of the 2011 FPG for the household to be income-eligible. Additionally, ARM 37.70.406(4) currently states that households at or below 75% of the estimated SMI for FFY 2011 for the household's size are eligible for LIEAP client education and outreach activities. ARM 37.70.406(4) as amended will provide that households at or below 60% of the estimated SMI are eligible for LIEAP client education and outreach activities. This amendment reflects the change in federal requirements from a maximum of 75% of SMI to a maximum of 60% of SMI. Additionally, the department proposes to use the SMI for FY 2012 rather than FY 2011 for the reasons explained above.
ARM 37.70.408
In determining eligibility for LIEAP, the department considers not only income but also assets (known in LIEAP as "resources") the household has, that can be used to pay heating costs. ARM 37.70.408 specifies the rules relating to resources. ARM 37.70.408(4) currently specifies the maximum amount of nonbusiness resources that households of varying sizes can have and still qualify for LIEAP in state FY 2011. ARM 37.70.408(5) provides that the dollar limits on nonbusiness resources will be revised annually to adjust for inflation, so it is necessary to amend ARM 37.70.408(4) to increase the dollar amounts for FY 2012. ARM 37.70.408(5) specifies that the revised nonbusiness resource limits will be computed by multiplying the current dollar limits by the percentage increase in the national consumer price index (CPI) for the previous calendar year or by 3%, whichever is less. The increase in the CPI for calendar year 2010 was 1.6%, so the dollar amounts in ARM 37.70.408(4) would increase by 1.6% from FY 2011 to 2012. Therefore, in accordance with the formula provided in ARM 37.70.408(5), ARM 37.70.408(4) must be amended to increase the maximum amounts of nonbusiness resources a total of 1.6% from FY 2011 to FY 2012. ARM 37.70.601 ARM 37.70.601 governs the computation of benefits for eligible households. (1)(a) provides that an eligible household's benefit is computed by multiplying the applicable amount in the table of benefits in (1)(c) by the applicable multiplier from the table of income/climatic adjustment multipliers in (1)(d). The benefit amounts in (1)(c) vary based on the type of heating fuel the household uses and the type and size of the household's dwelling. The benefit amounts also take into consideration available funding and the number of households expected to receive benefits in a given heating season. The benefit amounts in the tables are being revised based on estimates of the amount of funds available to pay LIEAP benefits for the 2011-2012 heating season as well as fuel cost projections and an estimate of the number of households that will apply and be found eligible for LIEAP for the 2011-2012 heating season. The revised benefit amounts in (1)(c) for 2011-2012 are based on the department's estimate that 25,000 households will qualify for LIEAP benefits for the current heating season and on the department's estimates of the federal LIEAP funds it will receive, which are expected to be significantly fewer than last year's. ARM 37.70.601(1)(d) contains a table of income/climatic adjustment multipliers which are based on a household's income as a percentage of the FPG and also on what part of the state the household lives in. The state is divided into ten regions with different multipliers to take into account the climatic differences from one part of the state to another, which have an impact on residential heating costs. The table in (1)(d) currently contains 13 income levels ranging from income at 0 to 11% of the FPG to incomes of 143 to 200% of the FPG. The highest level must now be amended to cover incomes up to 150% of the FPG rather than 200% because the department is lowering the upper-income limit for households with eight or more members to 150% of the guidelines, as explained in regard to the amendment of ARM 37.70.406. The rule is further being amended to provide that the multipliers in this highest income level also are used for households whose income exceeds 150% of the FPG, such as those categorically eligible households, mentioned in ARM 37.70.402(2).
ARM 37.70.901 contains the policies governing the provision of emergency assistance, that is, assistance to address circumstances that present a serious immediate threat to the health and safety of the household, such as the existence of hazardous or potentially hazardous conditions in the household's water or space heating system. ARM 37.70.901(4) limits the emergency assistance payments a household may receive in a 12-month period to a total of $250, but (4)(a) currently provides an exception to this limit. It states that a household may receive emergency assistance payments that total more than $250 in a 12-month period "if the local contractor determines before services are rendered that the services are necessary to alleviate an emergency." The department proposes to strike the language "before the services are rendered" in (4)(a). The requirement for prior approval is being eliminated because it is often difficult to get the local contractor's approval before the service is rendered when an emergency occurs on a weekend or holiday. The requirement remains for the local contractor to determine that the services were necessary to alleviate an emergency in order for payments totaling more than $250 in a 12-month period to be paid; the only change is that the determination need not be made before the services are rendered. Fiscal Impact
LIEAP is 100% federally funded. Congress has not yet appropriated funds for LIEAP for the 2011-2012 heating season, but based on the information available at this time the department estimates that Montana will receive LIEAP funds of approximately $13.4 million for the current heating season. This compares to LIEAP funding of $26.9 million for the 2010-2011 heating season. Benefit levels for households using all types of heating fuel and for all dwelling types will be significantly lower than in the 2010-2011 heating season. It is estimated that 25,000 households will qualify for LIEAP benefits this year, which is comparable to last year. 5. The department intends to apply ARM 37.70.601 retroactively to October 1, 2011. Some applicants and recipients will suffer a negative impact from the retroactive application of the proposed amendments to ARM 37.70.406, which lowers the upper income limit to qualify for LIEAP benefits, because some households that would have been eligible using the current income limits will have too much income to qualify under the proposed lower income limits. The retroactive application of the proposed amendment of the benefit tables in ARM 37.70.601 will have a negative impact on all households eligible to receive LIEAP benefits because the proposed amendment reduces benefit amounts for all households regardless of the household's size, type or size of dwelling, or type of heating fuel used. All other proposed amendments will have a positive impact on some or all applicants or recipients of LIEAP benefits. Despite its negative impact, retroactive application of the proposed changes to ARM 37.70.406 is required by a mandatory change in the federal law governing LIEAP. As discussed above in the Statement of Reasonable Necessity for the amendment of ARM 37.70.406, Public Law (P.L.) 112-10 lowered the upper income limit for LIEAP eligibility from 75% to 60% of SMI. The department is required to apply the new lower income limit as of October 1, 2011, the beginning of the 2011-2012 heating season. The reduction of the benefits amounts in ARM 37.70.601 is caused by an anticipated reduction in the federal appropriation for LIEAP but is not mandated by a change in federal law. However, ARM 37.70.608(1)(a) authorizes the department to reduce benefits when funds are not available to serve all eligible households. As discussed in the Fiscal Impact Statement above, the department expects to have significantly fewer funds available to pay benefits this year while the number of applications is expected to remain substantially the same. Thus, it is anticipated that there will not be enough funds available to serve all eligible households if the department does not start paying lower benefits as of the first day of the heating season, October 1, 2011. 6. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; fax (406) 444-9744; or e-mail [email protected], and must be received no later than 5:00 p.m., October 20, 2011. 7. The Office of Legal Affairs, Department of Public Health and Human Services, has been designated to preside over and conduct this hearing. 8. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 6 above or may be made by completing a request form at any rules hearing held by the department. 9. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register. The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems. 10. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.
/s/ Barbara B. Hoffmann /s/ Anna Whiting Sorrell Rule Reviewer Anna Whiting Sorrell, Director Public Health and Human Services Certified to the Secretary of State September 12, 2011.
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A directory of state agencies is available online at http://www.mt.gov/govt/agencylisting.asp.
For questions about the organization of the ARM or this web site, contact [email protected].
