The California Department of Social Services (CDSS) has issued guidance regarding the CalWORKs overpayment collection threshold and discharge policies. This guidance supersedes ACL 19-19.
Effective July 1, 2019, the overpayment collection threshold for closed CalWORKs cases is increased from $35 to $250. Counties cannot demand collection of any non-fraudulent overpayments with a balance of $249 or less if the liable individual is no longer receiving CalWORKs. The $250 threshold includes claims related to Welfare-to-Work supportive services. The overpayment collection threshold applies to each individual claim, not to the total of multiple overpayment claims.
There is also a new discharge process for CalWORKs overpayments. If the liable individual has not received CalWORKs for 36 consecutive months or longer, the county must deem a non-fraudulent CalWORKs overpayment uncollectable and must discharge it. This rule applies even when there is a repayment agreement or a civil judgment if the overpayment is non-fraudulent. This discharge rule applies to each individual overpayment claim, not to the total of multiple overpayment claims. Counties must send a notice of action informing individuals when they are no longer liable for the overpayment.
The discharge policy does not apply to cases where fraud is alleged. If a fraud investigation is pending when the 36 month timeframe occurs, collection is placed in suspense until the result of the investigation. Collection can restart if the investigation determines there was fraud.
The discharge policy is not effective until it is programmed into the new single statewide computer system CalSAWS. However, when the discharge policy is programmed into CalSAWS, counties must apply it retroactively to any outstanding non-fraudulent CalWORKs overpayments established on or after December 1, 1996.
In addition, effective July 1, 2019, counties must now report any mass overpayment of CalWORKs benefits to CDSS. A mass overpayment is an overpayment caused by the same action or inaction that impacts either eight percent of the county’s CalWORKs caseload or more than 1,000 CalWORKs recipients, whichever is greater.
Also effective July 1, 2019, a civil or criminal welfare fraud action cannot be commenced if case record, or any consumer credit report used in the civil or criminal case for the purpose of determining the overpayment, has not been made available or has been destroyed after the three year retention period.
These policies also apply to Refugee Cash Assistance, Entrant Cash Assistance and Trafficking and Crime Victims Assistance Programs. (ACL 19-102, November 12, 2019.)