State relaxes rules on welfare overpayments

Friday, Sept. 22, 2000 | 10:03 a.m.

CARSON CITY -- The state Welfare Division Thursday decided to relax its regulation in collection of overpayments to families on public assistance who suffer extreme hardships.

The division put the final touches on rules to become effective Oct. 1 to allow welfare recipients to keep money overpaid because of errors by the agency and to boost the rates paid for child day care of these families.

State Welfare Administrator Mike Willden said it won't pursue cases where the division made an error. But it will collect on overpayments if there was collusion between the state employee and the recipient or if the recipient should have "reasonably known" there was an error.

For example, Willden said if the monthly check was $500 and the family received a $5,000 check, the members should have known that was an error. And repayment will be sought.

But Willden said a new hardship section has been added to the regulation. "If we do decide to collect, they can decide to apply for a hardship waiver," Willden said.

These waivers could be granted in a case where there is a medical hardship that results in an inability to pay back the money. Or they could be granted or suspended where the family would not have enough money to provide basic needs such as food, shelter and clothing.

Waivers could also be granted in the cases of welfare recipients at the federal poverty level. For instance, a family of three with an income of $1,157 a month could apply for the exemption to repay the amount due.

The division estimates that permitting the recipient to keep an overpayment because of an agency error will mean a loss of about $100,000 a year.

Jon Sasser, an attorney for Washoe Legal Services, had proposed the "hardship" rule at the last hearing on the regulation. And the welfare division and Sasser worked on the language permitting the waiver in certain cases. He estimated the "hardship" rule will apply only in about 5 percent of the cases.

The child care payment increase will mean about $1.3 million a year in higher rates. The state now pays about $30 million annually to child-care providers for children of employed welfare recipients, those who have recently gone off public assistance and those who are in danger of needing state help.

Under the schedule a group care home in Clark County licensed for seven to 12 children now receives a state payment of $100 a week for an infant or toddler up to 36 months old. The new payment will be $110 a week. The rate for caring for school aged children above 5-years old would go from $75 to $90.