ANGIE CHRISTENSEN, Plaintiff and Respondent, v. WILL LIGHTBOURNE, as Director, etc., et al., Defendants and Appellants.
S245395
IN THE SUPREME COURT OF CALIFORNIA
July 8, 2019
First Appellate District, Division Two A144254; San Francisco City and County Superior Court CFP-12-512070; Opinion No. S245395; Court: Superior; County: San Francisco; Judge: Ernest H. Goldsmith
Justice Liu authored the opinion of the Court, in which Chief Justice Cantil-Sakauye and Justices Chin, Corrigan, Cuellar, Kruger, and Groban concurred.
Counsel:
Legal Aid Society of San Mateo County, Hope G. Nakamura, Trinh Phan; Western Center on Lаw & Poverty, Richard A. Rothschild, Alexander Prieto, Rebecca C. Miller; Legal Aid of Marin and Stephanie E. Haffner for Plaintiff and Respondent.
Betty Nordwind, Patrick Lynch, David Ettinger and Rebecca Fischer for Harriett Buhai Center for Family Law as Amicus Curiae on behalf of Plaintiff and Respondent.
Counsel who argued in Supreme Court (not intended for publication with opinion):
Michael J. Mongan, Deputy Attorney General, 455 Golden Gate Avenue, Suite 11000, San Francisco, CA 94102-7004, (415) 510-3377
Richard A. Rothschild, Western Center on Law & Poverty, 3701 Wilshire Boulevard, Suite 208, Los Angeles, CA 90010, (213) 487-7211
Opinion of the Court by Liu, J.
We granted review to decide whether a household member‘s income that is used to pay child support for a child living in anothеr household counts as income “reasonably anticipated” to be “received” by the paying household within the meaning of
I.
We 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.
A.
For many years, the federal Assistance to Family with Dependent Children (AFDC) program provided cash aid to needy families. (
In 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
To 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.” (
To 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. (
The California
Eligibility determinations for CalWORKs aid are made by county welfare departments in accordance with the Department‘s rules and regulations. (
Before the enactment of CalWORKs, a Department regulatiоn allowed counties, “in [d]etermining [n]et [i]ncome,” to “deduct[]” from gross income “actual payments made in support of a child or spouse not in the home, paid pursuant to a court order.” (Cal. Dept. of Social Services, Manual Letter No. EAS-92-02: Standards of Assistance Income, former MPP § 44-113.9 (Mar. 1, 1992) p. 480 (Manual Letter No. EAS-92-02).) On October 14, 1997,
B.
Angie Christensen (Christensen) lived with her husband, Bruce, their three children, and her three children from a prior marriage. She was ineligible for CalWORKs aid because she was receiving Supplemental Security Income benefits. (
Christensen requested an administrative hearing, arguing that the amounts garnished from her husband‘s wages and unemployment benefits as child support “could not be considered as ‘reasonably anticipated to be received’ and therefore should not be counted in either the eligibility or grant determination process.” The administrative lаw judge agreed and instructed the county to recompute the family‘s eligibility for CalWORKs aid, omitting those amounts from Bruce‘s income.
The Director of the California Department of Social Services reversed and denied Christensen‘s claim. The Director reasoned that “no regulation . . . exempts child support payments paid by or garnished from an [assistance unit] member‘s earned or unearned income.” Citing to All County Letter No. 97-59, the Director concluded that “the child support payments garnished from the claimant‘s husband‘s earned income and [unemployment insurance benefits] was correctly included as nonexempt available income in determining [the assistance unit‘s] eligibility for CalWORKs benefits.”
Christensen filed a combined petition for writ of mandate and administrative mandamus (
The Court of Appeal reversed. It observed that “the CalWORKs statutes and regulations do not specifically prescribe how to treat child support paid by a nоncustodial parent in determining the nonexempt income of the paying parent‘s assistance unit.” (Christensen v. Lightbourne (2017) 15 Cal.App.5th 1239, 1252 (Christensen).) The court concluded that under Yamaha Corp. of America v. State Board of Equalization (1998) 19 Cal.4th 1 (Yamaha), the Department‘s interpretation of the law, which it has consistently maintained over the 20 years since the inception of the CalWORKs program, was entitled to “great weight.” (Christensen, at p. 1252.) Specifically, the court concluded that the Department‘s interpretation of “reasonably anticipated” income as “gross income before any potential exemptions or deductions are subtracted” was “reasonable and worthy of deference” in light of the statute‘s legislative history. (Id. at p. 1255.) The court rejected Christensen‘s argument that because court-ordered child support paid by a noncustodial parent is not ” ‘available’ ” to meet the needs of the paying household, it must be excluded from the paying household‘s income. (Id. at p. 1256.)
The Court of Appeal also rejected Christensen‘s argument that the Department‘s policy of counting garnished child support as income resulted in double-counting of income in violation of section 11005.5. The court observed that “Christensen does not claim that any family‘s CalWORKs cash aid is being considered to deny another person or family CalWORKs aid.” (Christensen, supra, 15 Cal.App.5th at p. 1258.) And the court explained that “child support paid to benefit a child living in a family receiving CalWORKs aid is not generally counted as income to that child‘s family” because, with exceptions not applicable here, “[f]ederal and state law require that CalWORKs applicants assign their rights to any child support payments to the county and state in order to receive CalWORKs aid.” (Id. at p. 1259.)
We granted review.
II.
The issue here is the validity of the Department‘s interpretation of the CalWORKs statutes. We review questions of statutory interpretation de novo. (Reid v. Google, Inc. (2010) 50 Cal.4th 512, 527.) “Deference to administrative interpretations always is ‘situational’ and depends on ‘a complex of factors’ [citation], but where the agency has special expertise and its decision is carefully considered by senior agency officials, that decision is entitled to correspondingly greater weight.” (Sharon S., supra, 31 Cal.4th at p. 436.) Where an agency‘s action is “quasi-legislative” or “the substantive product of a delegated legislative power conferred on the agency,” the scope of our review is “limited to determining whether the regulation (1) is ‘within the scope of the authority conferred’ [citation] and (2) is ‘reasonably necessary to effectuate the рurpose of the statute’ [citation].” (Yamaha, supra, 19 Cal.4th at pp. 8, 11.) By
Although the classification of an agency‘s action as quasi-legislative or interpretive often guides our analysis, we have observed that “some rules defy easy categorization.” (Assn. of Cal. Ins. Cos. v. Jones (2017) 2 Cal.5th 376, 397.) At times, it is “helpful to imagine ‘quasi-legislative’ and ‘interpretive’ as the outer boundaries of a continuum measuring the breadth of the authority delegated by the Legislature. [Citation.] Thus, in certain circumstances, a regulаtion may have both quasi-legislative and interpretive characteristics — ‘as when an administrative agency exercises a legislatively delegated power to interpret key statutory terms.’ ” (Id. at p. 397.)
A.
Section 11451.5 directs the Department to calculate “the income of the family” for the purposes of determining CalWORKs eligibility by calculating the sum of the applicant family‘s “earned income,” meaning “gross income received as wages, salary, employer-provided sick leave benefits, commissions, or profits from activities such as a business enterprise or farming in which the recipient is engaged as a self-employed individual or as an employee,” disability-based unearned income such as disability insurance benefits, and the family‘s “unearned income,” which is any income that does nоt fall within the meaning of “earned” or “[d]isability-based unearned” income. (
The CalWORKs statute excludes from income the first $225 of income plus 50 percent of each additional dollar of gross earnings. (
Christensen argues that the funds used to pay Bruce‘s child support obligations cannot constitute “income” to her household because her family can never actually receive or benefit from those funds, and therefore the funds are not “reasonably anticipated” to be “received” within the meaning of section 11265.2. Because the money used to pay child support is not actually available to her household, Christensen contends, that money cannot be counted as part of “the family‘s income” for purposes of calculating CalWORKs aid. (
In Heckler v. Turner (1985) 470 U.S. 184 (Heckler), the high court explained that the principle of actual availability “traces its origins to congressional consideration of the 1939 amendments” to the Social Security Act, during which legislators expressed concern that state agencies might assume financial assistance from potential sources (e.g., a recipient‘s children) who might not actually contribute. (Heckler, at p. 200.) The requirement that income be actually available prohibits states from “conjuring fictional sources of income and resources by imputing financial support from persons who have no obligation to furnish it or by overvaluing assets in a manner that attributes nonexistent resources to recipients.” (Ibid.) This policy was endorsed by federal agencies administering the former AFDC program. (Id. at pp. 200-201.)
We recognized a comparable principle in Cooper v. Swoap (1974) 11 Cal.3d 856 (Cooper), where we held that treating “noncash economic benefits,” such as shared housing, as “income” under the former AFDC program was invalid. (Id. at p. 859.) We explained that “under the governing provisions of the federal Social Security Act only a recipient‘s actual available income may be deducted from his basic welfare benefit; arbitrary or constructive ‘presumptions’ of income are not permissible.” (Id. at p. 870; see Waits v. Swoap (1974) 11 Cal.3d 887, 894-895 (Waits) [only the ” ‘actual value of housing and utility benefits received could possibly constitute income to the recipient’ ” (citing Cooper, at p. 870)]; Mooney v. Pickett (1971) 4 Cal.3d 669, 680 [concluding that a county regulation denying general assistance to “employable” single men was invalid because “theoretical employability is a barren resource; it is inedible; it provides neither shelter nor any other necessity of life“].)
Furthermore, section 11265.2, subdivision (b), which defines ” ‘reasonably anticipated’ ” income, is concerned not with whether income is actually or only theoretically available, but rather with an issue of timing, i.e., when income can be expected to be received. Specifically, the statute provides that “income shall be considered to be ‘reasonably anticipated’ if the county is reasonably certain of the amount of income and that the income will be received during the semiannual reporting period.” (
Christensen further argues that the CalWORKs scheme did not displace the Department‘s earlier regulation excluding child support payments from income. She reads section 11157, subdivision (b)‘s directive that “[e]xcept as otherwise provided . . . , ‘income’ shall be deemed to be the same as applied under the [AFDC] program on August 21, 1996” to preserve the Department‘s former policy (under AFDC) of deducting child support payments from income. In a related argument, amicus curiae Harriett Buhai Center for Family Law argues that the Legislature‘s decision to exempt a certain amount of earnings from income when calculating CalWORKs aid (
Section 11451.5, subdivision (a), specifies that “for purposes of subdivision (a) of section 11450” — that is, for purposes of calculating
Furthermore, the Department‘s former policy treated the sums used to pay child support as part of the gross income of the noncustodial parent, subject to an income deduction. (See MPP, former §§ 44-113.9, 44-113.24, 44-113.241; see also Cal. Dept. of Social Services, MPP, former § 44-113.242, eff. July 1, 1968 [providing that a “[d]eduction is made from income for” “support payments actually made to or for his dependents living elsewhere“].) Amicus‘s labeling of child support under the former policy as an “allocation” rather than an “exemption” appears inaccurate and in any event has no bearing on the meaning of the statutory text, which indicates that the definition of income and exemptions in section 11451.5 comprehensively replaced the former system of exemptions and deductions.
In sum, nothing in the text of the CalWORKs statute exempts or excludes funds used to pay child support from the definition of income. And the statute does not indicate thаt the Legislature intended to preserve the Department‘s prior policy of deducting such payments from income.
B.
Christensen‘s principal argument is that including child support paid by a noncustodial parent as part of the paying household‘s income “thwarts the primary purpose of both CalWORKs and child support.” California‘s child support guideline “takes into account each parent‘s actual income and level of responsibility for the children,” with the goal of placing “the interests of children as the state‘s top priority.” (
Christensen further argues that counting child support as income could create a perverse incentive for families like Christensen‘s to live separately in order to obtain the CalWORKs aid they need to support their children. (See Amicus Br. of Alliance for Children‘s Rights at p. 12 [“Requiring parents to choose between feeding their children and living together as a family simply cannot be part of a system designed to protect an institution that the Legislature declared is ‘of fundamental importance to society in nurturing its members, passing on values, averting potential social problems, and providing the secure structure in which citizens live out their lives. . . .’ ” (citing
Christensen‘s arguments are not without force, and the exclusion she urges may have merit as a matter of policy. But the Legislature charged the Department with “full power to supervise every phase of the administration of public social services” (
Given the lack of any indication in the statute compelling or prohibiting the deduction of child support payments from income, we agree that the Department‘s decision to include child support payments as income is properly characterized as quasi-legislative. We must therefore decide whether the Department acted “within the scope of the authority conferred” and whether its action was ” ‘reasonably necessary to effectuate the purpose of the statute.’ ” (Yamaha, supra, 19 Cal.4th at p. 11.) Christensen argues that the Department‘s decision was not reasonable because it conflicts with the Legislature‘s overriding policy goal of ensuring adequate support for all children. The Department counters that its interpretation of the Legislature‘s intent in passing CalWORKs — specifically, its understanding that the earned-income disregard was intended to encourage work and to replace AFDC-era disregards with a simpler grant calculation method in lieu of a patchwork of disregards — was reasonable.
We think the Department has the better argument. It is a fair inference that, in enacting CalWORKs and its expanded earned-income disregard, the Legislature sought a more streamlined approach to grant calculation as a means of improving the program‘s administrability. Moreover, although the elimination of the child support disregard might not directly advance the Legislative purpose of encouraging families to work more, it may operate to do so indirectly. For example, families paying court-ordered child support whose earned income is insufficient to make ends meet may ultimately decide to seek more earned income. Thus, the replacement of the child-support disrеgard with an earned-income disregard may function as an incentive for families to increase their earned income.
We therefore conclude the Department‘s interpretation was “reasonably necessary to implement the purpose of the statute.” (Yamaha, supra, 19 Cal.4th at p. 11.) This is especially so where the Legislature has “left untouched” the Department‘s interpretation of the statute, despite making other amendments to the CalWORKs scheme over the years. (Sara M. v. Superior Court (2005) 36 Cal.4th 998, 1015; see, e.g., Sen. Bill No. 1041 (2011-2012 Reg. Sess.) [amending exemption amounts by changing the calculation of eligibility for benefits]; Assem. Bill No. 1233 (1999-2000 Reg. Sess.) [clarifying that on-the-job training wages are not excluded from income].) The Legislature considered restoring the child support disregard in 1999, but the proposal was not
Christensen does not contend that the CalWORKs statute must be construed to provide exclusions from income for garnishments to pay other debts. Instead, she argues that court-ordered child support obligations are distinguishable from other debts because CalWORKs and child support obligations “operate together to implement the legislative intent that all children . . . receive sufficient support“; because child support is a debt that has priority over debts owed to other creditors and cannot be modified without the consent of the local child support agency and the court (
We agree that the law in many ways treats child support obligations differently from other debts. But wе do not agree that the conclusion to be drawn from this special treatment is that the Department‘s policy frustrates the statute‘s purpose. As discussed, no exclusion for child support appears in the statute‘s text. And although the absence of a statutory exclusion may render some households ineligible for CalWORKs or reduce the amount of aid, the Legislature in enacting CalWORKs declared 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.” (
In sum, we hold that the Department‘s determination that funds garnished to pay child support for the benefit of a child living in another household are not exempt from the paying household‘s income for purposes of determining its eligibility for or amount of CalWORKs aid was a reasonable exercise of its delegated lawmaking authority and was therefore valid.
We now address Christensen‘s argument that the Department‘s policy of counting garnished child support as income to the paying household results in counting the same income twice in violation of section 11005.5.
Section 11005.5 says: “All money paid to a recipient or recipient group as aid is intended to help the recipient meet his individual needs or, in the case of a recipient group, the needs of the recipient group, and is not for the benefit of any other person. Aid granted under [Part 3 of Division 9 of the Welfare and Institutions Code, which now includes the CalWORKs program] . . . to a recipient or recipient group and the income or resources of such recipient or recipient group shall not be considered in determining eligibility for or the amount of aid of any other recipient or recipient group.” The Legislature enacted this statute in 1973 “to insure that aid paid (1) is for the individual needs of its recipient, (2) is not for the benefit of any other person, and (3) shall not be viewed or treated as income available to any other person. To treat one person‘s aid as a reason to deny eligibility or to reduce assistance to which another is entitled amounts to defiance of the legislative proscription.” (Rogers v. Detrich (1976) 58 Cal.App.3d 90, 101, fn. omitted; see id. at pp. 99-101 [discussing history of section 11005.5]; id. at p. 101 [holding that Supplemental Security Income recеived by one household member should not be considered in calculating eligibility for General Assistance for any other household member].)
Christensen points to the second sentence of section 11005.5 and argues that the child support payment garnished from Bruce‘s “income or resources” is used to determine her household‘s CalWORKs aid eligibility as well as the receiving family‘s aid eligibility or amount. “Under the Department‘s policy,” Christensen contends, “the garnished child support ‘income’ received by the custodial family is ‘considered in determining eligibility or the amount of aid’ to the paying family, in violation of §11005.5.” According to Christensen, the policy “results in counting the same income twice” because the same funds are “counted as available to the paying family when the paying family applies for or receives CalWORKs” and “counted as available to the receiving family when that family also receives CalWORKs.”
But Christensen‘s “double counting” argument misapprehends the character of the child support payment. As the Attorney General explains, “there is a distinction between the child support received by Bruce‘s noncustodial child, and the funds used to pay that support obligation.” The Attorney General illustrates this distinction by observing that if one CalWORKs recipient buys a car from another CalWORKs recipient and agrees to pay monthly installments, it is not double counting to treat the funds used by the
IV.
We affirm the judgment of the Court of Appeal.
LIU, J.
We Concur:
CANTIL-SAKAUYE, C.J.
CHIN, J.
CORRIGAN, J.
CUÉLLAR, J.
KRUGER, J.
GROBAN, J.