Poverty Law 1, MFIP Assets Adjunct Professor Monica Bogucki Poverty Law 1, MFIP Assets Adjunct Professor Monica Bogucki 2019 Copyright

Why talk about assets? Financial planners for low income people Complexity of Programs Reduce Stress and Despair Improve Stability

What is the MDHS Certification for Combined Manual? Program Manual which has not been promulgated by the Minnesota Administrative Procedures Act. It is a guideline but not the law. http://www.dhs.state.mn.us https://mn.gov/dhs/general-public/publications-forms-resources/manuals/

Dept. of Human Services Bulletin Bulletins are guidelines but are not the law. This bulletin explains the new Minnesota Statutes 256P, et. seq. (2016) DHS Bulletin # 16-11-01 Unified Asset Policy for Economic Assistance Cash Programs

MFIP Asset Limit Before June 1, 2016 General Rule for Assets: The equity value of all non-excluded real and personal property of assistant unit must not exceed $2,000 for applicants and $ 5,000 for ongoing participants Minn. Stat. 256J.20 subd. 3

Asset Limit for Multiple Programs Effective June 1, 2016 The equity value of legally available personal property must not exceed $10,000 for applicants and participants. Minn. Stat. 256P.01, subd. 2 Minnesota Statute section 256P.02 subd. 2 Applies to: Minnesota Family Investment Program (MFIP) Diversionary Work Program (DWP) General Assistance (GA) Group Residential Housing (GRH) Minnesota Supplement Aid (MSA)—unless also receiving SSI benefits

What Assets are Excluded? What are examples of excluded assets? One vehicle per assistance unit member age 16 or older Minn. Stat. 256P.02, subd. 3 Liquid Stocks and bonds that have financial penalties Minn. Stat. 256P.02, subd. 2(3) Legally Unavailable Personal Property. Minn. Stat. 256P.02, subd.1 Real Property Certificate of Deposits that are NOT matured DHS Bulletin 16-11-01

Example Ann and Joe are married and jointly own their home. She just obtained an Order for Protection against Joe. She is afraid to live in home for several months pending the outcome of the criminal charges against Joe. They are receiving MFIP-S. Will the county count the home against her asset limit? Minn. Stat. 256P.02; DHS Bulletin 16-11-01 Excluded because it is real property.

Example Sally just went through a divorce. The marital home was sold for $150,000. Her cash portion of the home is $ 50,000 She plans on downsizing. She is on MFIP-S, will the county count the $ 50,000 to her asset limit? Minn. Stat. 256P.02, subd. 2 Yes, once the cash is legal available. Perhaps, there is a way to seamlessly put the funds into another home or manufactured home. If she keeps the cash, she will be ineligible for MFIP.

Example Sally is thinking about investing her $ 50,000 in a nice manufactured or mobile home. She wants to know if this will be counted towards her MFIP-S asset limit? Minn. Stat. 256P.02, DHS bulletin 16-11-01 Generally, a mobile home is personal property. DHS bulletin 16-11-01 states “a mobile home or manufactured home is not considered a vehicle for cash programs. “ Public Policy—it is her home. Mobile home is excluded.

Home Ownership Markeeta owns a home worth $ 75,000. Will this impact her eligibility for MFIP-S? Minn. Stat. 256P.02 It is excluded because it is real property and real property is excluded. Q; WHAT IS THE PUBLIC POLICY BEHIND THIS DECISION/

Vehicles One vehicle per assistance unit member age 16 or older is excluded from the asset limit. Minn. Stat. 256P.02, subd. 3 All vehicles licensed or unlicensed are considered: Cars, trucks, vans, campers, motorcycles, trailers. Minn. Stat. 256P.02, subd. 3

What if there are more vehicles than one vehicle per assistance unit member age 16 or older. Excess vehicles will be counted based on the trade-in value—National Automobile Dealers Association online car values. Minn. Stat. 256P.02, subd. 3 “The agency shall reimburse the applicant or participant for the cost of a written statement that documents a lower loan value.” Minn. Stat. 256P.02, subd. 3

Marie and Donald have a Hyundai car with a $ 9500. 00 trade-in value Marie and Donald have a Hyundai car with a $ 9500.00 trade-in value. They also have a second car Toyota with a $ 5,000 trade-in value. Will they be eligible for MFIP? Their assistance consists of Marie, age 25 and Donald age 24 and Sandy age 1. Both of their cars will be excluded. One vehile per assistance until member age 16 or older. Minn. Stat. 256P.02, subd. 3

Mary and Jim have a van with special medical adaptions for a wheelchair. They have a minor son with physical disabilities. The van has a trade-in value of $ 20,000. They need the van to transport him to medical appointments. Will they be eligible for MFIP? This is their only vehicle. Yes, the van will be excluded, regardless of value, because there are two assistance unit members who are over 16 years old and only one car. Minn. Stat. 256P.02, subd. 2

Mary and John live on a hobby farm Mary and John live on a hobby farm. They have two cars which are licensed and are in working condition. They have two cars on their farm which are unlicensed and are not in running condition. Mary and John have two minor children who are under age 16 years old. How will these cars be counted for MFIP asset purposes? Two of the cars (I would use the working cars—if the value is higher) are excluded as assets per Minn. Stat. 256P.02 subd. 3. The remaining two cars will be valued through NADA based on trade-in value. If there is a cost to obtain this—then the county must pay for this.

Example Jim is a single father of two children. He recently lost his job and is receiving MFIP benefits. He has a high school education and has always wanted to become an electrician. He started his training this fall. He has $8,000 in school loans, grants and scholarships after paying for tuition, books for this semester. He wants to know if this will affect his MFIP- S benefits? If his other liquid assets such as cash, bank accounts, person property is less than2000.00, then he will remain eligible for MFIP. (Talk about prepaying) Minn. Stat. 256P.02, subd. 2

What are the rules for legal availability? The county agency must use the equity value of the legally available personal property. The property is presumed to be legally available to the applicant or participant unless the applicant or participant documents that the property is not legally available. Minn. Stat. 256P.02, subd. 1(c)

Joint ownership Jean has a joint checking account with her elderly mother. There is $ 2,000 in the account. Jean is a MFIP-S recipient. How will the county view this account? The county will county the full $2,000 to Jean’s MFIP asset limit. “When a person personal property is jointly owned by two or more persons, the agency shall assume that each person owns an equal share, except that either person owns the entire sum of a joint personal checking or savings account.” Minn. Stat. 256P.02, subd. 1 (b)

Joint ownership Jean has a joint stock portfolio with her elderly mother. There is $ 2,000 in the account. Jean is a MFIP-S recipient. How will the county view this account? They will count $1,000 of these funds to Jean’s MFIP asset limit. Jean can document that it is legally unavailable. Minn. Stat. 256P.02, subd. 1(b) Jean could also become Power of Attorney

Please advise Tom and Sally Jones Tom and Sally have two minor children, Sara and Abbie. Tom is a carpenter and was injured on the job. He is now receiving a worker compensation settlement of $ 35,000. Tom and Sally have been on MFIP for 1 year. They own their own home-principal balance is $ 40,000 Their car is worth $ 3500 and needs about $ 600.00 in repairs See next slide for more information

More Information about Tom and Sally $3,000 in consumer debt Tom wants to upgrade his tools for work $ 700.00 $200.00 in savings $25.00 in checking No other liquid assets What are their options?

Reporting Requirements Duty to report changes within 10 days Minnesota Statute 256P.07, subd. 3

Reporting Requirements effective Dec. 18, 2017 Must report within ten day of the date they occur, or at the time of recertification of eligibility or within eight calendar days of a reporting period—whichever occurs first. Minn. Stat. 256P.07, subd. 3

Verification issues Minn. Stat. 256J.32 Minn. Stat. 256P.04

Scenario Marie and Joe have a nine-month old baby. Marie and Joe lose their jobs due to a recent factory closing. They lose their home. They are living in a modest recreational vehicle that has no encumbrance against it. It is worth $14,000. They are participants in the MFIP-S program. Will the recreational vehicle count as an asset? Get certification from county that this is their home, thus excluded Take a loan against the RV to reduce the equity value Prove that the vehicle is worth less than it is—get statement from dealer.

What would you advise the following family based on laws effective June 1, 2016? The Johnsons are ongoing MFIP recipients. They are receiving: $ 2,000 in earned income tax credit (EITC) this year. They have: no savings, $1,000 consumer credit card debt, a car worth $ 600.00. They expect a renter’s refund of $500.00 in the next several months. What are their options?

Individuals excluded from assistance unit for MFIP Persons who are recipients of Supplemental Security Income or Minnesota Supplemental Aid. Minn. Stat. 256J.24 subd. 3(1)