[Federal Register Volume 65, Number 151 (Friday, August 4, 2000)]
[Rules and Regulations]
[Pages 47831-47833]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-19726]


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DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 253

RIN: 0584-AC81


Food Distribution Program on Indian Reservations: Income 
Deductions and Miscellaneous Provisions

AGENCY: Food and Nutrition Service, USDA.

ACTION: Final rule.

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SUMMARY: The Food and Nutrition Service is amending the regulations for 
the Food Distribution Program on Indian Reservations. The changes are 
intended to improve program service by allowing households two 
additional income deductions when proper verification is provided. The 
first income deduction will be given to households that pay legally 
required child support for a nonhousehold member. This change conforms 
to an income deduction allowed under the Food Stamp Program. The second 
income deduction will be provided to households that pay the premium 
for their Medicare Part B medical insurance. This deduction was 
prompted by a resolution passed by the National Association of Food 
Distribution Programs on Indian Reservations. This rule will also make 
technical amendments, such as changing outdated terminology, and 
revising or removing provisions that are obsolete or have changed.

EFFECTIVE DATE: This rule is effective October 3, 2000.

FOR FURTHER INFORMATION CONTACT: Lillie F. Ragan, Assistant Branch 
Chief, Household Programs Branch, Food Distribution Division, Food and 
Nutrition Service, U.S. Department of Agriculture, Room 510, 3101 Park 
Center Drive, Alexandria, Virginia 22302-1594, or by telephone (703) 
305-2662.

SUPPLEMENTARY INFORMATION:

    I. Procedural Matters
    II. Background and Discussion of the Final Rule

I. Procedural Matters

Executive Order 12866

    This 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.

Public Law 104-4

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. 
L.

[[Page 47832]]

104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Food and Nutrition Service generally must prepare a written statement, 
including a cost-benefit analysis, for proposed and final rules with 
``Federal mandates'' that may result in expenditures to State, local, 
or tribal governments, in the aggregate, or to the private sector, of 
$100 million or more in any one year. When such a statement is needed 
for a rule, section 205 of the UMRA generally requires the Food and 
Nutrition Service to identify and consider a reasonable number of 
regulatory alternatives and adopt the least costly, more cost-effective 
or least burdensome alternative that achieves the objectives of the 
rule.
    This rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local, and tribal 
governments or the private sector of $100 million or more in any one 
year. Thus, this rule is not subject to the requirements of sections 
202 and 205 of the UMRA.

Executive Order 12372

    The program addressed in this action is listed in the Catalog of 
Federal Domestic Assistance under No. 10.567, and for the reasons set 
forth in the final rule of 7 CFR part 3015, subpart V, and related 
Notice (48 FR 29115), is included in the scope of Executive Order 
12372, which requires intergovernmental consultation with State and 
local officials.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612). The 
Administrator of the Food and Nutrition Service has certified that this 
action will not have a significant impact on a substantial number of 
small entities. While program participants and Indian Tribal 
Organizations and State agencies that administer the Food Distribution 
Program on Indian Reservations will be affected by this rulemaking, the 
economic effect will not be significant.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. The 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. 
There are no administrative procedures which must be exhausted prior to 
any judicial challenge to the provisions of this rule or the 
applications of its provisions.

Paperwork Reduction Act

    The information collection requirements included in 7 CFR 
253.7(a)(6)(i) have been approved by the Office of Management and 
Budget under OMB. No. 0584-0293.

II. Background and Discussion of the Final Rule

    On January 14, 2000, the Food and Nutrition Service (FNS) published 
a rule in the Federal Register (65 FR 2358) proposing amendments to the 
regulations at 7 CFR part 253 for the Food Distribution Program on 
Indian Reservations (FDPIR). We indicated that the proposed changes 
would improve program service by allowing households two additional 
income deductions when proper verification is provided. The first 
income deduction would be given to households that pay legally required 
child support for a nonhousehold member. The second income deduction 
would be provided to households that pay the premium for their Medicare 
Part B medical insurance. The Department also proposed making certain 
technical amendments, such as changing outdated terminology, and 
revising or removing provisions that are obsolete or have changed.
    Comments were solicited through March 14, 2000, on the provisions 
of the proposed rulemaking. FNS received two comments from the public 
on the proposed regulatory changes, and no comments on the proposed 
information collection burden changes. Both commenters wrote in support 
of the proposed changes. Consequently, we are adopting the proposed 
rule as final, with one minor change, which is discussed below. For a 
full understanding of the provisions of this final rule, the reader 
should refer to the preamble of the proposed rule.
    One of the commenters requested clarification in regard to the 
verification requirements associated with this rulemaking. By this 
action, the regulations at 7 CFR 253.7(a)(6)(i)(B) and (C) require the 
verification of Medicare Part B premium withholdings or payments, and 
child support payments, before the income deductions can be granted to 
a household. The commenter asked whether the Medicare Part B premium 
must be verified if it is not included in the Social Security check 
received by the household member. The State agency is required to 
verify the payment of the Medicare Part B premium whenever this cost is 
incurred by a household member. When conducting an eligibility 
interview, the State agency should first determine whether any 
household members are Medicare beneficiaries. If none of the household 
members are Medicare beneficiaries, the income deduction cannot be 
granted. If the household contains a Medicare beneficiary, the State 
agency should determine whether the Medicare Part B premium is withheld 
from a Social Security, Railroad Retirement Board, or Civil Service 
Retirement payment, or if it is paid directly by the household member 
to Medicare. If the premium is withheld from one of the above 
retirement/disability payments, documentation of this expense could 
include a copy of the Social Security benefit statement (SSA-4926-SM) 
for the current calendar year, or a similar statement provided to 
Railroad Retirement Board and Civil Service Retirement beneficiaries. 
The proposed rule at 7 CFR 253.7(a)(6)(i)(C)(1) identified only the 
Social Security benefit statement as a source of documentation for 
premium withholdings. We have revised this provision to include 
Railroad Retirement Board and Civil Service Retirement benefit 
statements as additional sources of documentation. If the benefit 
statement does not reflect that the Medicare Part B premium is being 
withheld from the monthly retirement payment, the income deduction 
cannot be granted.
    Some individuals make direct payments to Medicare because they do 
not receive a Federal retirement or disability payment from which the 
Medicare premium can be withheld. This may include persons under 65-
years of age who have chronic kidney disease or other disabilities. 
Documentation for these individuals could include money order receipts, 
canceled checks, or other receipts showing payment for the current 
calendar year. Direct payments to Medicare are usually made on a 
quarterly basis; therefore, the premium payment in these cases must be 
averaged over the 3-month payment period to determine a monthly amount 
for certification purposes. If the household cannot provide adequate 
documentation of this expense, the income deduction cannot be granted.
    Similarly, the State agency must verify the household's payment of 
child support to or for a non-household member. Specifically, the State 
agency must verify the household's legal obligation to pay child 
support, the amount of the obligation, and the monthly amount of child 
support the

[[Page 47833]]

household actually pays. A court order, or similar documentation, is 
necessary to verify the household member's legal obligation to pay the 
child support, but it cannot be used to verify the household's actual 
monthly child support payments. Some non-custodial parents fail to 
fully meet their court-ordered obligation and owe hundreds of dollars 
in child support. Verification of actual payments will ensure that 
these non-custodial parents receive an income deduction for the amount 
of child support they pay--not the amount they are required, but fail, 
to pay each month.
    During the eligibility interview, the State agency should determine 
the actual monthly amount of child support that has been paid by the 
household member, and obtain documentation of payment (for example, 
money order receipts or canceled checks). In many cases, the amount 
paid each month may fluctuate. In such instances, we recommend that the 
State agency average the amounts paid each month to determine the 
amount to be used for certification purposes. For example, Mr. Smith is 
legally obligated to pay $300 in child support each month. In December, 
he paid $300; in January, he only paid $200; in February, he paid $350, 
and in March he paid $350. The eligibility worker averages the total 
amount of child support paid over the four months ($1200  4 
months) and determines that Mr. Smith is entitled to receive an income 
deduction of $300.

List of Subjects in 7 CFR Part 253

    Administrative practice and procedure, Food assistance programs, 
Grant programs, Social programs, Indians, Reporting and recordkeeping 
requirements, Surplus agricultural commodities.
    Accordingly, 7 CFR Part 253 is amended as follows:

PART 253--ADMINISTRATION OF THE FOOD DISTRIBUTION PROGRAM FOR 
HOUSEHOLDS ON INDIAN RESERVATIONS

    1. The authority citation for 7 CFR part 253 is revised to read as 
follows:

    Authority: 91 Stat. 958 (7 U.S.C. 2011-2032).

    2. In Sec. 253.3, revise the third sentence of paragraph (d) to 
read as follows:


Sec. 253.3  Availability of commodities.

* * * * *
    (d) * * * The food package offered to each household by the State 
agency shall contain a variety of foods from each of the food groups in 
the Food Distribution Program on Indian Reservations Monthly 
Distribution Guide Rates by Household Size--Vegetables, Fruit, Bread-
Cereal-Rice-Pasta, Meat-Poultry-Fish-Dry Beans-Eggs-Nuts, Milk-Yogurt-
Cheese, and Fats-Oils-Sweets. * * *


Secs. 253.5 and 253.6  [Amended]

    3. In Sec. 253.5(a)(2)(vii) and Sec. 253.6(e)(2)(iii)(B), remove 
the acronym ``AFDC'', wherever it appears, and add in its place the 
acronym ``TANF''.


Sec. 253.5  [Amended]

    4. In Sec. 253.5, remove paragraph (f)(2), and redesignate 
paragraph (f)(3) as paragraph (f)(2).

    5. In Sec. 253.6:
    a. Remove paragraph (d)(2)(iv)(F);
    b. Amend paragraph (e)(1)(ii) by removing the words ``January 1 and 
July 1'' and adding, in their place, the words ``October 1'';
    c. Amend paragraph (e)(2)(i)(C) by removing the words 
``Comprehensive Employment and Training Act'' and adding, in their 
place, the words ``Job Training Partnership Act'';
    d. Amend paragraph (e)(2)(ii)(A) by removing the words ``Aid to 
Families with Dependent Children (AFDC)'' and adding, in their place, 
the words ``Temporary Assistance for Needy Families (TANF)'';
    e. Remove paragraphs (e)(3)(x)(F) and (e)(3)(x)(G); and
    f. Add new paragraphs (f)(3) and (f)(4) to read as follows:


Sec. 253.6  Eligibility of households.

* * * * *
    (f) * * *
    (3) Households will receive a deduction for legally required child 
support payments paid by a household member to or for a nonhousehold 
member, including payments made to a third party on behalf of the 
nonhousehold member (vendor payments). The State agency must allow a 
deduction for amounts paid towards overdue child support (arrearages). 
Alimony payments made to or for a nonhousehold member cannot be 
included in the child support deduction.
    (4) Households will receive a deduction for the full amount of the 
Medicare Part B medical insurance premium that is withheld from the 
Federal retirement or disability payment of a household member or is 
paid by a household member directly to Medicare. This income deduction 
is not allowed in situations where the premium is paid by the State on 
behalf of the Medicare beneficiary or where household members are not 
Medicare beneficiaries because they receive their health care through 
the Indian Health Service.

    6. In Sec. 253.7, revise paragraph (a)(6)(i) to read as follows:


Sec. 253.7  Certification of households.

    (a) * * *
    (6) * * *
    (i) Mandatory verification.
    (A) Gross non-exempt income. The State agency must obtain 
verification of each household's gross non-exempt income prior to 
certification. Households certified under the expedited service 
processing standards at paragraph (a)(9) of this section are not 
subject to this requirement. Income does not need to be verified to the 
exact dollar amount unless the household's eligibility would be 
affected, since Food Distribution Program benefits are not reduced as 
income rises. If the eligibility worker is unable to verify the 
household's income, the worker must determine an amount to be used for 
certification purposes based on the best available information. Reasons 
for inability to verify income include failure of the person or 
organization providing the income to cooperate with the household and 
the State agency, or lack of other sources of verification.
    (B) Legal obligation and actual child support payments. The State 
agency must obtain verification of the household's legal obligation to 
pay child support, the amount of the obligation, and the monthly amount 
of child support the household actually pays. Documentation that 
verifies the household's legal obligation to pay child support, such as 
a court order, cannot be used to verify the household's actual monthly 
child support payments.
    (C) Medicare Part B medical insurance premium. The State agency 
must obtain verification of the household's payment of the Medicare 
Part B medical insurance premium. Documentation of this expense could 
include:
    (1) A copy of the current year Social Security benefit statement 
(SSA-4926-SM), or a similar statement provided to Railroad Retirement 
Board and Civil Service Retirement beneficiaries, which identifies the 
amount of the Medicare Part B premium withheld each month; or
    (2) A receipt for Medicare Part B premium payments paid directly to 
Medicare by the household.
* * * * *

    Dated: July 28, 2000.
Samuel Chambers, Jr.,
Administrator, Food and Nutrition Service.
[FR Doc. 00-19726 Filed 8-3-00; 8:45 am]
BILLING CODE 3410-30-U