[Federal Register Volume 63, Number 118 (Friday, June 19, 1998)]
[Rules and Regulations]
[Pages 33545-33546]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16206]
[[Page 33545]]
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SOCIAL SECURITY ADMINISTRATION
20 CFR Part 416
RIN 0960-AD82
Supplemental Security Income for the Aged, Blind, and Disabled;
Valuation of In-Kind Support and Maintenance With Cost-of-Living
Adjustment
AGENCY: Social Security Administration.
ACTION: Final rules.
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SUMMARY: These regulations implement section 13735 of the Omnibus
Budget Reconciliation Act of 1993 (OBRA 1993). This statutory provision
amends the Social Security Act (the Act) and requires that the new
supplemental security income (SSI) benefit rate, as increased by a
cost-of-living adjustment (COLA), be used in determining the value of
the statutory one-third reduction and the regulatory presumed maximum
value for the computation of Federal SSI benefit payments for the first
2 months for which the COLA is in effect. These rules provide that we
value the statutory one-third reduction and the regulatory presumed
maximum value using the benefit rate as increased by a COLA to
determine the amount of in-kind support and maintenance received by an
individual which is to be counted for those months. This precludes a
decrease in the benefit amount the third month after a COLA, a
situation which occurred under the prior law. The legislation is
effective for benefits paid for months after calendar year 1994.
EFFECTIVE DATE: These final rules are effective July 20, 1998.
FOR FURTHER INFORMATION CONTACT: Daniel T. Bridgewater, Legal
Assistant, Office of Process and Innovation Management, L2109 West Low
Rise Building, Social Security Administration, 6401 Security Boulevard,
Baltimore, MD 21235-0001, (410) 965-3298 for information about these
rules. For information on eligibility or claiming benefits, call our
national toll-free number, 1-800-772-1213.
SUPPLEMENTARY INFORMATION: Under retrospective monthly accounting
(RMA), an individual's current SSI benefit amount is usually determined
based upon the individual's income in the second preceding month
(``budget month'') before the current month. For example, January's SSI
benefit amount is based on the individual's November income. In some
instances, an individual receives income in the form of in-kind support
and maintenance and it is counted using the value of the one-third
reduction (VTR) or the presumed maximum value (PMV) rule. Under the law
prior to the effective date of section 13735 of Public Law 103-66, the
VTR and the PMV were based on the applicable benefit rates in effect in
the ``budget month.'' Because of RMA principles, when an annual COLA to
the SSI benefit rate became effective in January, we used the VTR/PMV
amount from November of the previous year to determine the individual's
benefit for January if an individual had in-kind support and
maintenance in the ``budget month.'' For example, in figuring an
individual's January 1994 benefit, we used November 1993 as the
``budget month.'' Thus, in a computation using the VTR, we would
subtract the 1993 VTR amount of $144.66 from the 1994 benefit rate of
$446.00, giving the individual an SSI benefit of $301.34. February's
benefit amount would also be computed using the new benefit rate and
the 1993 VTR amount. However, in computing March's benefit amount, we
used the benefit rate of $446.00 less the January 1994 VTR amount of
$148.66, resulting in an SSI benefit amount of $297.34. Thus, the
individual's January and February payments exceeded the March payment
because of the increased amount of the new VTR used when January was
the ``budget month.'' Notices were then released to these individuals
notifying them of the decrease in their March payment. This was
confusing to SSI recipients because their payment amounts increased and
then decreased even if there was no change in their living
arrangements.
We are changing the method of valuation of the VTR/PMV to reflect
section 13735 of Public Law 103-66 for benefits paid after calendar
year 1994, by using the new benefit rate as increased by a COLA in
determining the VTR or PMV for the computation of SSI benefits for the
first 2 months for which the COLA is in effect. Thus, beginning with
the COLA effective January 1, 1995, both the new increased benefit rate
and new increased VTR or PMV amounts are being used in computing a
January and February benefit amount. Unlike the example used
previously, the individual's January, February, and March payments
calculated by using the VTR amount will be the same assuming all other
income remains constant--i.e., there will be no decrease in the SSI
benefit amount the third month after a COLA. This eliminates confusion
for recipients and also eliminates the need for issuance of notices
informing affected recipients of the decrease in their March payment.
We state in the final regulations at Sec. 416.420(a) that we will
use the benefit rate, as increased by a COLA, in determining the value
of certain in-kind support and maintenance used to compute an
individual's SSI benefit amount for the first 2 months in which the
COLA is in effect. We have added a third example to Sec. 416.420(a) to
further clarify the regulatory intent.
We state in the final regulations at Sec. 416.1130 how we value in-
kind support and maintenance when a COLA applies, and we have altered
the example to reflect the situation when a COLA becomes effective.
On August 9, 1995, we published these rules as a notice of proposed
rulemaking in the Federal Register at 60 FR 40542 with a 60-day comment
period. We received comments from only one source, and the commenter
fully supported the proposed rule because it eliminates a significant
anomaly in the SSI program. Therefore, we are publishing the final
rules essentially unchanged from the proposed rules.
Regulatory Procedures
Executive Order 12866
We have consulted with the Office of Management and Budget (OMB)
and determined that these final rules do not meet the criteria for a
significant regulatory action under Executive Order 12866. Thus, they
were not subject to OMB review.
Paperwork Reduction Act of 1980
These final rules impose no new reporting or recordkeeping
requirements subject to OMB clearance.
Regulatory Flexibility Act
We certify that these final rules will not have a significant
economic impact on a substantial number of small entities because they
affect only individuals. Therefore, a regulatory flexibility analysis
as provided in the Regulatory Flexibility Act, as amended, is not
required.
(Catalog of Federal Domestic Assistance Program No. 96.006,
Supplemental Security Income)
List of Subjects in 20 CFR Part 416
Administrative practice and procedure, Aged, Blind, Disability
benefits, Public assistance programs, Reporting and recordkeeping
requirements, Supplemental Security Income (SSI).
Dated: June 9, 1998.
Kenneth S. Apfel,
Commissioner of Social Security.
For the reasons set out in the preamble, subparts D and K of part
416 of chapter III of title 20 of the Code of
[[Page 33546]]
Federal Regulations are amended as follows:
PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND
DISABLED
Subpart D--[Amended]
1. The authority citation for subpart D of part 416 continues to
read as follows:
Authority: Secs. 702(a)(5), 1611(a), (b), (c), and (e), 1612,
1617, and 1631 of the Social Security Act (42 U.S.C. 902(a)(5),
1382(a), (b), (c), and (e), 1382a, 1382f, and 1383).
2. Section 416.420 is amended by revising paragraph (a) to read as
follows:
Sec. 416.420 Determination of benefits; general.
* * * * *
(a) General rule. We generally use the amount of your countable
income in the second month prior to the current month to determine how
much your benefit amount will be for the current month. We will use the
benefit rate (see Secs. 416.410 through 416.414), as increased by a
cost-of-living adjustment, in determining the value of the one-third
reduction or the presumed maximum value, to compute your SSI benefit
amount for the first 2 months in which the cost-of-living adjustment is
in effect. If you have been receiving an SSI benefit and a Social
Security insurance benefit and the latter is increased on the basis of
the cost-of-living adjustment or because your benefit is recomputed, we
will compute the amount of your SSI benefit for January, the month of
an SSI benefit increase, by including in your income the amount by
which your Social Security benefit in January exceeds the amount of
your Social Security benefit in November. Similarly, we will compute
the amount of your SSI benefit for February by including in your income
the amount by which your Social Security benefit in February exceeds
the amount of your Social Security benefit in December.
Example 1. Mrs. X's benefit amount is being determined for
September (the current month). Mrs. X's countable income in July is
used to determine the benefit amount for September.
Example 2. Mr. Z's SSI benefit amount is being determined for
January (the current month). There has been a cost-of-living
increase in SSI benefits effective January. Mr. Z's countable income
in November is used to determine the benefit amount for January. In
November, Mr. Z had in-kind support and maintenance valued at the
presumed maximum value as described in Sec. 416.1140(a). We will use
the January benefit rate, as increased by the COLA, to determine the
value of the in-kind support and maintenance Mr. Z received in
November when we determine Mr. Z's SSI benefit amount for January.
Example 3. Mr. Y's SSI benefit amount is being determined for
January (the current month). Mr. Y has Social Security income of
$100 in November, $100 in December, and $105 in January. We find the
amount by which his Social Security income in January exceeds his
Social Security income in November ($5) and add that to his income
in November to determine the SSI benefit amount for January.
* * * * *
Subpart K--[Amended]
3. The authority citation for subpart K of part 416 continues to
read as follows:
Authority: Secs. 702(a)(5), 1602, 1611, 1612, 1613, 1614(f),
1621, and 1631 of the Social Security Act (42 U.S.C. 902(a)(5),
1381a, 1382, 1382a, 1382b, 1382c(f), 1382j, and 1383); sec. 211,
Pub. L. 93-66, 87 Stat. 154 (42 U.S.C. 1382 note).
4. Section 416.1130 is amended by revising paragraph (a) to read as
follows:
Sec. 416.1130 Introduction
(a) General. Both earned income and unearned income include items
received in kind (Sec. 416.1102). Generally, we value in-kind items at
their current market value and we apply the various exclusions for both
earned and unearned income. However, we have special rules for valuing
food, clothing, or shelter that is received as unearned income (in-kind
support and maintenance). This section and the ones that follow discuss
these rules. In these sections (Secs. 416.1130 through 416.1148) we use
the in-kind support and maintenance you receive in the month as
described in Sec. 416.420 to determine your SSI benefit. We value the
in-kind support and maintenance using the Federal benefit rate for the
month in which you receive it. Exception: For the first 2 months for
which a cost-of-living adjustment applies, we value in-kind support and
maintenance you receive using the VTR or PMV based on the Federal
benefit rate as increased by the cost-of-living adjustment.
Example: Mr. Jones receives an SSI benefit which is computed by
subtracting one-third from the Federal benefit rate. This one-third
represents the value of the income he receives because he lives in
the household of a son who provides both food and shelter (in-kind
support and maintenance). In January, we increase his SSI benefit
because of a cost-of-living adjustment. We base his SSI payment for
that month on the food and shelter he received from his son two
months earlier in November. In determining the value of that food
and shelter he received in November, we use the Federal benefit rate
for January.
* * * * *
[FR Doc. 98-16206 Filed 6-18-98; 8:45 am]
BILLING CODE 4190-29-P
