CAPI undue hardship exception to transfer of assets rule

The California Department of Social Services (CDSS) has issued guidance regarding the undue hardship exception to the Cash Assistance Program for Immigrants (CAPI) transfer of assets rule.

CAPI follows rules for the federal Supplemental Security Income (SSI) program unless state law says otherwise.  For the SSI program, applicants or recipients cannot transfer assets for less than fair market value.  If a SSI applicant transfers resources for less than fair market value, they are subject to a period of ineligibility from the program of up to 36 months.  This rule applies to CAPI. If the county determines that there has been a transfer of assets for less than fair market value, the county must evaluate the case for exceptions to the transfer of assets rule, including the undue hardship exception.

Undue hardship exists if the claimant alleges that failure to receive CAPI would deprive them of food or shelter; and the individual’s total available funds (income and liquid resources) is less than the federal SSI benefit rate plus the state supplemental payment.  The county must accept a claimant’s documented allegation of deprivation of food or shelter unless there is clear evidence to the contrary.  Counties cannot consider receipt of CalFresh when determining whether a claimant has sufficient food, and cannot consider receipt of federal housing assistance when determining whether a claimant would be deprived of shelter without CAPI benefits.

For purposes of determining undue hardship, there is loss of shelter if the recipient would be subject to eviction without CAPI benefits, and there is no other affordable available, or there is no other available housing with necessary modifications for a disabled person.

The county must explain the undue hardship exception and econsider undue hardship in all cases where the county determines that there has been a transfer of assets for less than fair market value and no other exceptions apply.  If the county determines that undue hardship exists, the transfer of assets penalty is not imposed.  If the claimant states that there is no undue hardship, the county is not required to determine undue hardship, but must document the statement in the case file.

Undue hardship is a mnth-by-month determination.  Counties should determine undue hardship for six month periods and re-evaluate if the period of ineligibility lasts for more than six months.

For purposes of determining income for undue hardship, all income counts including the actual value of In Kind Support and Maintenance that is counted for purposes of CAPI.

For purposes of determining resources for undue hardship, all liquid resources, whether otherwise countable or excluded, count, except for designated burial funds or certain dedicated accounts. Any CAPI or SSI retained from prior months counts as a resource.

When determining countable income and resources, counties exclude 1) CAPI or SSI and items that are not countable as income for CAPI or SSI; 2) CalFresh benefits; 3) federally subsidized housing; 4) proceeds of a bona-fide loan.

For cases where CAPI benefits have already been granted, counties determine when the period of ineligibility started and develop the undue hardship for each prior month of the period of ineligibility.  (ACL 24-11, March 11, 2024.)