Appellate District, Division Two A144254
Superior Court San Francisco City and County Superior Court
CFP-12-512070 Ernest H. Goldsmith Judge.
D. Harris and Xavier Becerra, Attorneys General, Jonathan L.
Wolff, Chief Assistant Attorney General, Janill L. Richards,
Principal Deputy State Solicitor General, Julie
Weng-Gutierrez, Assistant Attorney General, Geoffrey H.
Wright, Associate Deputy State Solicitor General, Susan M.
Carson, Jennifer A. Bunshoft and Michael J. Mongan, Deputy
Attorneys General, for Defendants and Appellants.
Aid Society of San Mateo County, Hope G. Nakamura, Trinh
Phan; Western Center on Law & Poverty, Richard A.
Rothschild, Alexander Prieto, Rebecca C. Miller; Legal Aid of
Marin and Stephanie E. Haffner for Plaintiff and Respondent.
Nordwind, Patrick Lynch, David Ettinger and Rebecca Fischer
for Harriett Buhai Center for Family Law as Amicus Curiae on
behalf of Plaintiff and Respondent.
Jennifer Braun, Angela Schwartz, Elise Weinberg, Nisha
Kashyap, Rachel Stein; Remcho, Johansen & Purcell and
Robin B. Johansen for Alliance for Children's Rights as
Amicus Curiae on behalf of Plaintiff and Respondent.
Justice Liu authored the opinion of the Court, in which Chief
Justice Cantil-Sakauye and Justices Chin, Corrigan,
Cuéllar, Kruger, and Groban concurred.
granted review to decide whether a household member's
income that is used to pay child support for a child living
in another household counts as income “reasonably
anticipated” to be “received” by the paying
household within the meaning of Welfare and Institutions Code
section 11265.2 for purposes of determining eligibility for
state welfare benefits. The California Department of Social
Services determined that it does, and we conclude that its
determination was reasonable and therefore valid. We must
also decide whether the policy of the California Department
of Social Services treating court-ordered child support as
“income” violates Welfare and Institutions Code
section 11005.5 by counting the same funds as income twice:
once to the paying household and once to the receiving
household. We conclude that it does not. Accordingly, we
affirm the judgment of the Court of Appeal.
begin with an overview of the relevant federal and state
statutes governing the provision of cash assistance to needy
households and then describe the dispute in this case.
many years, the federal Assistance to Family with Dependent
Children (AFDC) program provided cash aid to needy families.
(42 U.S.C. § 601, as in effect before Aug. 22, 1996;
Sneed v. Saenz (2004) 120 Cal.App.4th 1220, 1229
(Sneed).) “The AFDC program [wa]s one of three
major categorical public assistance programs established by
the Social Security Act of 1935.” (King v.
Smith (1968) 392 U.S. 309, 313.) AFDC provided states
with federal funds “on a matching funds basis to aid
the ‘needy child... who has been deprived of parental
support or care by reason of the death, continued absence
from the home, or physical or mental incapacity of a parent,
and who is living with' any of the several listed
relatives.” (Van Lare v. Hurley (1975) 421
U.S. 338, 340, quoting former 42 U.S.C. § 606(a).) To
qualify for federal funding under the AFDC program, states
were required to operate a program consistent with the Social
Security Act (42 U.S.C. § 301 et seq.). (Townsend v.
Swank (1971) 404 U.S. 282, 285-286.) Doing so required
state agencies to comply with federal requirements governing
how to calculate an individual's income as well as what
sources of income should be “disregard[ed]” in
calculating income. (42 U.S.C. § 602(a) (1994).)
1996, Congress enacted the Personal Responsibility and Work
Opportunity Reconciliation Act, which replaced the AFDC
program with a program called Temporary Aid to Needy Families
(TANF). (Pub.L. No. 104-193, 110 Stat. 2105; Sneed,
supra, 120 Cal.App.4th at p. 1231.) In place of
AFDC's system of federal matching funds, TANF provides
states with block funding to distribute to poor families
while requiring state plans to “limit the receipt of
aid to a specified number of months” and “include
certain elements such as requiring aid recipients to engage
in specified work activities.” (Sneed, at p.
1231, citing 42 U.S.C. §§ 607, 608.) Congress's
purpose in enacting TANF was to “increase the
flexibility of States” in operating programs designed
to “provide assistance to needy families so that
children may be cared for in their own homes or in the homes
of relatives” and to “end the dependence of needy
parents on government benefits by promoting job preparation,
work, and marriage.” (42 U.S.C. § 601(a).)
implement TANF, our Legislature undertook a
“comprehensive review and overhaul of [the state's]
welfare system” and enacted the California Work
Opportunity and Responsibility to Kids (CalWORKs) program.
(Sneed, supra, 120 Cal.App.4th at p. 1231.)
The Legislature observed that “[e]ach family unit has
the right and responsibility to provide for its own economic
security by full participation in the work force to the
extent possible. Each family has the right and responsibility
to provide sufficient support and protection of its children,
to raise them according to its values and to provide every
opportunity for educational and social progress.”
(Welf. & Inst. Code, § 11205; all undesignated
statutory references are to this code.) CalWORKs implemented
a new aid calculation methodology designed to increase the
work effort of aid recipients and to encourage recipients to
seek and obtain more employment income. (Sneed, at
qualify for CalWORKs, a household's “reasonably
anticipated income, less exempt income, ” must fall
below the “maximum aid payment” for a household
(sometimes called an “assistance unit”) of its
size. (§ 11450.12, subd. (b); Cal. Dept. of Social
Services, Manual of Policy and Procedures § 44-207
(MPP).) The CalWORKs statute specifies that income is “
‘reasonably anticipated' if the county is
reasonably certain of the amount of income and that the
income will be received” during the prospective,
semiannual reporting period. (§ 11265.2, subd. (b).)
Eligible applicants receive a cash grant equal to the
difference between the family's income and the maximum
aid payment. (§ 11450.)
California Department of Social Services (Department) is
vested with “full power to supervise every phase of the
administration of public social services.” (§
10600.) The Department promulgates rules and standards for
the implementation of the statutes it enforces. These rules
and standards are adopted in compliance with the procedures,
including notice and comment requirements, set forth in the
California Administrative Procedure Act (Gov. Code §
11340 et seq.), and they are published in the MPP.
(§§ 10554, 11209; see Smith v. Los Angeles
County Bd. of Supervisors (2002) 104 Cal.App.4th 1104,
1109.) The Legislature also authorized the Department to
“implement, interpret, or make specific the amendments
to this division... by means of all-county letters or similar
instructions from the department until regulations are
adopted.” (§ 10606.2, subd. (a).) The
interpretations of the CalWORKs statute in the MPP and
all-county letters “come from authoritative legal and
policymaking levels of the agency.” (Sharon S. v.
Superior Court (2003) 31 Cal.4th 417, 436 (Sharon
determinations for CalWORKs aid are made by county welfare
departments in accordance with the Department's rules and
regulations. (§§ 10800, 11209.) The
Department's implementing regulations direct counties to
consider only income that the county is “reasonably
certain that the recipient will receive” during the
six-month budgeting period. (MPP § 44-101(c); see also
MPP § 44-102.) From this amount, counties subtract
income deemed “exempt” by statute or regulation.
(§§ 11450.12, subd. (b), 11451.5; see MPP §
44-111.) Under the AFDC program, a family could exempt from
its gross monthly income the first $30 of income and
one-third of each additional dollar of earned income.
CalWORKs replaced the AFDC exemption with a new income
disregard of the first $225 of earned income or
disability-based unearned income, plus 50 percent of each
additional dollar of gross earnings. (§ 11451.5.) The
greater income disregard under CalWORKs permits individuals
to earn more income than was possible under the former AFDC
program without risking a reduction in aid or becoming
ineligible for aid, thereby effectuating the