9 CCR 2503-2
DEPARTMENT OF HUMAN SERVICES Income Maintenance (Volume 3)
GENERAL FINANCIAL ELIGIBILITY CRITERIA 9 CCR 2503-2 [Editor’s Notes follow the text of the rules at the end of this CCR Document.] _________________________________________________________________________
3.200 GENERAL FINANCIAL ELIGIBILITY CRITERIA (NOT APPLICABLE TO COLORADO WORKS)
[Rev. eff. 9/15/12]
3.200.1 DETERMINATION OF NEED
3.200.11 Determination of need must be made in accordance with the financial eligibility requirements for the specific assistance program.
3.200.12 Consideration of Countable Income and Resources [Rev. eff. 5/1/11]
NOTE: Resources are not applicable to Colorado Works on or after January 7, 2011. For the purpose of determining need for assistance, all countable resources and income must be taken into consideration.
3.200.13 Definition of Countable Resources and Income [Rev. eff. 5/1/11]
NOTE: Resources are not applicable to Colorado Works on or after January 7, 2011. Countable resources and income mean those which are considered to be available to the applicant, recipient, or family budget unit after the application of appropriate exemptions, disregards, and deductions.
3.200.2 AVAILABILITY OF RESOURCES AND INCOME (Not applicable to Colorado Works)
3.200.21 When Resources and Income are Considered Available
Resources and income shall be considered available both when actually available and when the applicant or recipient has a legal interest in a sum (includes cash or equity value of a resource) and has the legal ability to make such sum available for support and maintenance. If the resources and/or income have been transferred to a trust, the trust shall be submitted to the State Department of Health Care Policy and Financing for review in accordance with the Medical Assistance Staff Manual, Section 8.110.52 (10 CCR 2505-10). Eligibility shall not be determined until a response from the Department of Health Care Policy and Financing is received regarding the treatment of the trust.
3.200.22 Securing Resources and Income
An applicant or recipient must make every reasonable effort to secure potential resources and income:
A. The time required to develop a resource or income to a state of availability must not be used as a basis for delaying action on an application;
B. So long as an applicant or recipient is taking appropriate steps to secure a potential resource or income, assistance must be continued without adjustment until the resource or income is available;
C. If an applicant or recipient refuses or fails to make a reasonable effort to secure a potential resource or income, such resource or income must be considered as if available, and timely and adequate notice must be given regarding a proposed action to deny, reduce, or terminate assistance;
D. If upon receipt of the prior notice, the applicant or recipient acts to secure the potential resource or income, the proposed action to deny, reduce, or terminate assistance must be withdrawn, and assistance must be approved and/or continued without adjustment until the resource or income is, in fact, available.
3.200.23 When a Resource or Income is Considered Potential
A resource or income is considered as potential only if the county department has determined that the applicant or recipient could, in fact, secure such resource or income by taking appropriate steps.
3.200.24 Potential Resource
A potential resource means one in which the applicant or recipient has the legal ability to acquire or reacquire rights of ownership. Situations which may indicate the possibility of a potential resource are, for example, manipulation of resources by a trustee or conservator against the terms of a trust or estate, obstruction of an inheritance, or loss of property by deception or fraud.
3.200.25 Potential Income
Potential income means a benefit or payment to which the applicant or recipient may be entitled, such as annuities, pensions, retirement or disability benefits, veterans compensation and pensions, workmen's compensation, Old Age, Survivor's, and Disability Insurance (OASDI) benefits, SSI benefits, and unemployment compensation.
3.200.3 DISTINGUISHING RESOURCES FROM INCOME (Not applicable to the Colorado Works Program)
3.200.31 Definitions
To distinguish resources from income to determine whether resources or income rules apply:
A. "Resources" mean those properties an applicant or recipient or family already has as of the first of a calendar month, or as of the date of application if not counted as income for the application month;
B. "Income" in general means any cash, payments, wages, in-kind receipt, inheritance, gift, prize, rents, dividends, interest, etc., that are received by an applicant, recipient, or family during a particular calendar month.
3.200.32 Bona Fide Loans
Bona fide loans shall be considered exempt from income and resources for the purpose of determining program eligibility and payment in the month received. Bona fide loans are loans, either private or commercial, which have a repayment agreement. Such loans shall be verified by written statement. Any money from the loan proceeds that remain on the first day of the month after the proceeds were received is considered a countable resource and will be used in calculating the resource maximum. Specific instructions regarding the treatment of educational loans are contained in the income section on “Educational Loans and Grants” .
3.200.33 Conversion of Resources
The conversion of one type of resource to another shall not represent income in the month of exchange. Conversions are:
A. Proceeds from the sale of an item of property;
B. Proceeds from fire or casualty insurance;
C. Payments on the principal of a contract of sale (such as a note or mortgage); except that, when a contract has been evaluated as being non-negotiable, such payments shall be considered as income.
3.200.34 Shifting of Resources
Shifting of resources from countable to exempt and shifting from one form of countable to another and from one form of exempt to another is permitted.
3.200.4 GENERAL RESOURCE AND INCOME EXEMPTIONS (NOT APPLICABLE TO COLORADO
WORKS) [Rev. eff. 9/15/12]
3.200.41 Exemptions [Rev. eff. 8/1/09]
To determine eligibility for financial assistance and the amount of the assistance payment, the following shall be exempt from consideration as either resources or income:
A. The value of Food Stamp coupons and USDA donated foods;
B. Benefits received under Title III, Nutrition Program for the Elderly, of the Older Americans Act;
C. The value of supplemental food assistance received under the special food services program for children provided for in the National School Lunch Act and under the Child Nutrition Act, including benefits received from the special supplemental food program for women, infants and children (WIC);
D. Home produce utilized for personal consumption;
E. Payments received under Title II of the Uniform Relocation Assistance and Real Property Acquisition Policies Act; relocation payments to a displaced homeowner toward the purchase of a replacement dwelling are considered exempt for up to 6 months (specific instructions are contained in the section on “Property Replacement Exemptions” );
F. The value of any assistance paid with respect to a dwelling unit under:
G. Payments received for providing foster care;
H. Payments to volunteers serving as foster grandparents, senior health aides, or senior companions, and to persons serving in the Service Corps of Retired Executives (SCORE) and Active Corps of Executives (ACE) and any other program under Title I (VISTA) when the value of all such payments adjusted to reflect the number of hours such volunteers are serving is not equivalent to or greater than the minimum wage, and Title II and III of the Domestic Volunteer Services Act;
I. the benefit provided an applicant, recipient, or household from the Low-Income Energy Assistance (LEAP) Program;
J. Any grant or loan to any undergraduate student for educational purposes made or insured under any programs administered by the Commissioner of Education (Basic Educational Opportunity Grants, Supplementary Educational Opportunity Grants, National Direct Student Loans, and Guaranteed Student Loans);
K. Any portion of educational loans and grants obtained and used under conditions that preclude their use for current living costs;
L. Funds received by persons fifty-five (55) years of age and older under the Senior Community Service Employment Program (SCSEP) under Title V of the Older Americans Act are excluded from income;
M. Payments received from the youth incentive entitlement pilot projects, the youth community conservation and improvement projects, and the youth employment and training programs under the Youth Employment and Demonstration Project Act;
N. Social Security benefit payments and the accrued amount thereof to a recipient when an individual plan for self-care and/or self-support has been developed. In order to disregard such income and resources, it must be determined that (1) SSI permits such disregard under such developed plan for self-care-support goal, and (2) assurance exists that the funds involved will not be used for purposes other than those intended;
O. Any retroactive OASDI or SSI benefits still remaining after the month of receipt shall be exempt as a resource for six months following the month they are received;
P. Compensation received by the applicant or recipient pursuant to the Colorado Crime Victims Compensation Act shall not be considered as income, property, or support available to the applicant or recipient. This is compensation paid to innocent victims or dependents of victims of criminal acts who suffer bodily injury;
Q. Assistance from other agencies and organizations for items not included in the need standard is exempt;
R. Monies received pursuant to the "Civil Liberties Act of 1988", P.L. No. 100-383, (by eligible persons of Japanese ancestry or certain specified survivors, and certain eligible Aleuts);
S. Any payment made from the Agent Orange Settlement Fund, pursuant to P.L. No. 101-201;
T. The value of any commercial transportation ticket, for travel by an applicant or recipient (or spouse) among the 50 states, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands, which is received as a gift by such applicant or recipient (or such spouse) and is not converted to cash;
U. Effective 1/1/91, reparation payments made under Germany's Law for Compensation of National Socialist Persecution (German Restitution Act);
V. Any money received from the Radiation Exposure Compensation Trust Fund, pursuant to P.L.
W. Property which is held in trust for or distributed per capita to members of Native American tribes pursuant to federal law, including purchases made with such funds and the interest and investment income accrued on judgment funds held in trust (P.L. No. 93-134, 97- 458, and 98-64);
X. Effective 9/1/91, reparation payments made under Sections 500 through 506 of the Austrian General Social Insurance Act;
Y. Effective 8/1/94, payments to applicants or recipients because of their status as victims of Nazi persecution pursuant to Public Law No. 103-286;
Z. Income paid to children of Vietnam veterans who were born with spina bifida pursuant to P.L.
AA. Payments made from any fund established pursuant to a class settlement in Walker v. Bayer Corporation, et al. 96-C-5024 (N.D. Ill.).
3.210 RESOURCES-GENERAL DEFINITIONS
3.210.1 PROPERTY OWNERSHIP (Not applicable to Colorado Works)
3.210.11 Definitions
"Resources" are the real and personal property which an applicant or recipient or family owns:
A. "Real property" means land, including (l) rights in land such as oil, mineral and water rights, and (2) buildings and other objects affixed to land:
B. "Personal property" means all items of ownership that are not considered real property.
3.210.12 Ownership
"Ownership" means lawful title to, legal right of possession of, or legal interest in a property.
3.210.13 Real Property
In order for real property to be considered a resource to the applicant or recipient, the following must be determined:
A. The actual value less encumbrances of the applicant's or recipient's ownership interest;
B. The negotiability of the ownership interest (that is, there are no legal restrictions from selling the applicant's or recipient's property interest); and, C. The ability to sell the property interest (that is, that the ownership interest can, in fact, be sold on the open market at any price).
3.210.14 Ownership Interest
The degree of the applicant's or recipient's ownership interest is determined by the type of ownership. Generally, the types of ownership are:
A. Sole ownership, in which the applicant or recipient is the only owner. If the applicant or recipient has the right to dispose of the property, the actual value less encumbrances of the property is determined and counted as a resource;
B. Shared ownership, in which the property is owned by two or more individuals. The actual value less encumbrances is determined and charged in proportion to the applicant's or recipient's share of ownership. There are two kinds of shared ownership:
3.210.15 Sale of Property
Negotiability and, if applicable, the applicant's or recipient's ability to sell the property interest at a reasonable price must be determined. Negotiability refers to the applicant's or recipient's legal right to dispose of an ownership interest; ability to sell refers to legal ability to sell. Reasonable price is determined to be two-thirds of the actual value as defined in the section on equity value.
A. Negotiability - there may be legal reasons why an applicant or recipient may not be able to sell the applicant's or recipient's property interest, such as, the estate is in probate or there is a lawsuit pending against the property. The refusal of co-owners to consent to the sale of a property interest is not a legal restriction of an applicant's or recipient's right to sell.
B. For adult financial and Medicaid applicants or recipients, if the co-owner of the property uses the property as the principal place of residence and would be forced to move if the property were sold the property shall be exempted.
C. For adult financial and Medicaid applicants or recipients, if the applicant or recipient cannot sell the property for two-thirds of the actual value as defined in the section on equity value the property shall be exempted provided that the applicant or recipient continues reasonable efforts to sell the property . This is done by listing the property with an agency or by advertising in the local media as examples. The county department must verify on a quarterly basis that a reasonable effort is being made to sell the property. If it is not determined to be a reasonable effort, the property shall not be exempted. If the property interest cannot be disposed of because of legal technicalities, the applicant's or recipient's equity value is not a countable resource. In instances where limitations exist which prevent disposition of property, the case file shall contain an explanation of the barrier and whether such limitation is expected to be resolved. Such an explanation shall be supported by documentation of the nature of the limitation.
3.210.16 Joint Checking and Savings Account
A. Unless there is evidence of different intent as established by the owners, the applicant or recipient's share of cash in a joint checking or savings account shall be established as the proportion of net contributions by each to the sums on deposit. The amount shall be determined by:
B. If the applicant or recipient or other account holder is incompetent, incapacitated or unable to sign a statement, a statement may be signed by a parent, other relative, legally appointed guardian or conservator acting responsibly on behalf of the applicant or recipient.
C. In situations where the corroborating statement cannot be obtained or there is reason to doubt the applicant's or recipient's statement, the county department may obtain a client release to secure bank records to determine the proportion of net contribution.
D. If the applicant or recipient establishes by a preponderance of evidence that the intent of ownership is other than the proportion of net contributions, the county department shall use the amount as established by the evidence. In cases where it has been shown the applicant or recipient has no interest in the account, the county department shall request:
3.210.17 Court Established Estate
If a court has established an estate for an applicant or recipient adjudicated mentally incompetent, the resources that appear in the inventory of the estate as accepted by the court must be considered available to such applicant or recipient.
3.210.2 PROPERTY OWNED BY A SPOUSE (Not applicable to Colorado Works)
3.210.21 Property Owned by One Spouse
For most purposes, as long as a resource is owned by one spouse alone, its value must only be charged to that spouse. However, as of September 30, 1989, this subsection does not apply to the consideration of resources for certain married couples: where one spouse becomes institutionalized on or after September 30, 1989, and the other spouse remains in the community (see the sections in the Department of Health Care Policy and Financing Medical Assistance Staff Manual, Volume 8, under "Treatment of Income and Resources for Institutionalized Spouses" (10 CCR 2505-10)).
3.210.22 Property Ownership When Couple is Permanently Separated
If it is determined that a married couple is permanently separated, ownership of property by a non-applicant or non-recipient spouse does not affect an applicant's or recipient's eligibility for assistance.
3.210.23 Permanent Separation
A married couple is considered to be permanently separated when:
A. They are divorced or legally separated; or, B. Both physical and financial ties have been dissolved and a relationship as spouses no longer exists.
3.210.24 Presumption of Marriage
Unless there has been a divorce or legal separation, the presumption is made that the couple is still married. Such presumption must be refuted by persons, other than the spouses, who can establish that they are in a position to know and assert that a complete and permanent separation does, in fact, exist.
3.210.3 TRANSFERS WITHOUT FAIR CONSIDERATION (Not applicable to Colorado Works)
3.210.31 Transfers Made With 36 Months Prior to Application
An applicant or recipient who disposes of resources at less than fair market value any time within 36 months immediately prior to filing of an application for assistance, or makes such a transfer while receiving assistance, may be ineligible for public assistance. In regard to an applicant or recipient, such a transaction is considered as a transfer of resources without fair consideration and is a factor of eligibility if the transfer, assignment, or sale of a resource was:
A. Voluntary, B. Without fair and valuable consideration; and.
C. For the purpose of rendering such applicant or recipient eligible for assistance. The county department shall make a rebuttable presumption that the transaction was for such purpose when the transfer was made any time during the 36 month period immediately prior to the filing of application for assistance or during such time that assistance was being received.
3.210.32 Presumption
An applicant or recipient must be given the opportunity to disprove a presumption by the county department that a transfer was made to establish or retain eligibility for assistance. Such presumption is nullified if the applicant or recipient can demonstrate to the county department that the transfer was for another purpose.
3.210.33 Other Purposes
Circumstances at the time of the transaction may indicate another purpose for a transfer without fair consideration. An applicant's or recipient's willingness to accept a sum which is less than a fair consideration may be shown to be reasonable based on a hardship just prior to the transaction. Examples of hardship are:
A. A period of unemployment causing a need of funds to meet monthly bills, and costs of subsistence;
B. An accident or severe illness causing a need of funds to meet large expenditures for medical care and services.
3.210.34 Involuntary Transfer
An involuntary transfer of a resource would not affect eligibility. Transfers which would be considered involuntary are:
A. Loss of property through fraud, provided that the applicant or recipient can demonstrate that every reasonable effort has been made to recover the property, by court action or other procedures as indicated; or, B. Loss of property through legal action such as judgment, foreclosure, delinquent tax sale, etc.
3.210.35 Property Transfer
A. Upon application, the county department will determine if the applicant or recipient transferred resources without fair consideration within the last 36 months. For an applicant or recipient of financial assistance, and/or the applicant's or recipient's spouse, who established a life estate on the applicant's or recipient's residence, a transfer of assets without fair consideration may occur. A transfer of assets without fair consideration occurs when a life estate was established on the residence by the applicant or recipient of financial assistance, and/or the applicant's or recipient's spouse, within 36 months from the date of application.
B. The amount to be considered as a transfer of assets without fair consideration shall be computed by using equity value of the property and applying it to the life estate table contained in these rules as follows:
3.210.351 (None)
3.210.352 Life Estate Remainder Interest Table (Not applicable to Colorado Works) AGE REMAINDER . AGE . . . .
0 .02812 . 35 1 .01012 . 36 2 .00983 . 37 3 .00992 . 38 4 .01019 . 39 . . . .
5 .01062 . 40 6 .01116 . 41 7 .01178 . 42 8 .01252 . 43 9 .01337 . 44 . . . .
10 .01435 . 45 11 .01547 . 46 12 .01671 . 47 13 .01802 . 48 14 .01934 . 49 . . . .
15 .02063 . 50 16 .02185 . 51 17 .02300 . 52 18 .02410 . 53 19 .02520 . 54 . . . .
20 .02635 . 55 21 .02755 . 56 22 .02880 . 57 23 .03014 . 58 24 .03159 . 59 . . . .
25 .03322 . 60 26 .03505 . 61 27 .03710 . 62 28 .03938 . 63 29 .04187 . 64 . . . .
30 .04457 . 65 31 .04746 . 66 32 .05058 . 67 33 .05392 . 68 34 .05750 . 69 . . . .
70 .39478 . 90 71 .41086 . 91 72 .42739 . 92 73 .44429 . 93 74 .46138 . 94 . . . .
75 .47851 . 95 76 .49559 . 96 77 .51258 . 97 78 .52951 . 98 79 .54643 . 99 . . . .
80 .56341 . 100 81 .58033 . 101 82 .59705 . 102 83 .61358 . 103 84 .63002 . 104 . . . .
85 .64641 . 105 86 .66236 . 106 87 .67738 . 107 88 .69141 . 108 89 .70474 . 109
3.210.353 Life Expectancy Table – Males (Not applicable to Colorado Works)
AGE EXPECTANCY . AGE . . . .
0 71.80 . 40 1 71.53 . 41 2 70.58 . 42 3 69.62 . 43 4 68.65 . 44 5 67.67 . 45 6 66.69 . 46 7 65.71 . 47 8 64.73 . 48 9 63.74 . 49 10 62.75 . 50 11 61.76 . 51 12 60.78 . 52 13 59.79 . 53 14 58.82 . 54 15 57.85 . 55 16 56.91 . 56 17 55.97 . 57 18 55.05 . 58 19 54.13 . 59 20 53.21 . 60 21 52.29 . 61 22 51.38 . 62 23 50.46 . 63 24 45.55 . 64 25 48.63 . 65 26 47.73 . 66 27 46.80 . 67 28 45.88 . 68 29 44.97 . 69 30 44.06 . 70 31 43.15 . 71 32 42.24 . 72 33 41.33 . 73 34 40.23 . 74 35 39.52 . 75 36 38.62 . 76 37 37.73 . 77 38 36.83 . 78 39 35.94 . 79
3.210.353 Life Expectancy Table – Females (Not applicable to Colorado Works)
AGE EXPECTANCY . AGE . . . .
0 78.79 . 40 1 78.42 . 41 2 77.48 . 42 3 76.51 . 43 4 75.54 . 44 5 74.56 . 45 6 73.57 . 46 7 72.59 . 47 8 71.60 . 48 9 70.61 . 49 10 69.62 . 50 11 68.63 . 51 12 67.64 . 52 13 66.65 . 53 14 65.67 . 54 15 64.68 . 55 16 63.71 . 56 17 62.74 . 57 18 61.77 . 58 19 60.80 . 59 20 59.83 . 60 21 58.86 . 61 22 57.89 . 62 23 56.92 . 63 24 55.95 . 64 25 54.98 . 65 26 54.02 . 66 27 53.05 . 67 28 52.08 . 68 29 51.12 . 69 30 50.15 . 70 31 49.19 . 71 32 48.23 . 72 33 47.27 . 73 34 46.31 . 74 35 45.35 . 75 36 44.40 . 76 37 43.45 . 77 38 42.50 . 78 39 41.55 . 79
3.210.36 Cash or Equity
An applicant or recipient may transfer cash or equity in a countable resource into joint ownership, one-half each, with the spouse, without being required to prove receipt of fair consideration; however, any amount transferred which is in excess of one-half must be regarded as a transfer without fair consideration.
3.210.4 EVALUATING PROPERTY TRANSACTIONS (NOT APPLICABLE TO COLORADO WORKS)
[Rev. eff. 5/1/11]
3.210.41 Definition of Transfer Without Fair Consideration
A "transfer without fair consideration" means a property transaction in which the proceeds of the transfer, assignment, or sale are less than the value of the resource.
3.210.42 As used in this section regarding property transactions:
A. Proceeds means actual proceeds of the transaction before consideration of expenses related to the transaction;
B. Value - for real and personal property - means actual value the property could sell for less encumbrances (as defined in the section entitled "Property Valuation");
C. Value - for liquid resources such as cash, savings/checking accounts, IRA accounts, etc. - means the current redemption rate, less encumbrances.
3.210.43 Transfer to a Trust
If assets are transferred into a trust, the trust documents shall be submitted to the Colorado Department of Health Care Policy and Financing for review in accordance with the Medical Assistance manual, Section 8.110.52 (10 CCR 2505-10), to determine how the trust is to be considered for eligibility purposes. Eligibility shall not be determined until a response is received from the Department of Health Care Policy and Financing regarding the treatment of the trust. This provision does not apply to trust deposits for burial expenses.
3.210.44 Procedures for Determining Effect of a Transfer
For the purpose of determining the effect of a transfer without fair consideration in regard to an applicant's or recipient's eligibility for assistance, the following procedures shall be used:
A. To determine the amount of the transfer without fair consideration, the uncompensated value of the resource must be determined. The uncompensated value is the difference between the value of a resource and the amount received by the applicant or recipient as a result of the disposal when the disposal was for less than fair market value.
B. For adult category programs, such value transferred without fair consideration must be divided by the applicable amortization rate to determine the number of months that the transfer without fair consideration makes the applicant or recipient ineligible for assistance.
3.210.45 Amortization
The amortization rate shall be equal to the current standard of assistance for the program under which the applicant or recipient has applied, or has received assistance, plus the monthly medical care costs, including health insurance premiums that the applicant or recipient is responsible to pay.
A. The amortization period shall begin on the first day of the first month of the transfer and extend through the last complete month of the calculation. Partial months shall be dropped from the calculation.
B. There shall be no maximum period of ineligibility for the uncompensated value of the transfer.
3.210.46 Period of Ineligibility
When an applicant or recipient transfers assets without fair consideration, the county department shall determine the number of months of ineligibility as follows:
A. Determine the actual value less encumbrances;
B. Determine the current standard of assistance for the applicable program;
C. Add any monthly medical costs, including health insurance premiums that the applicant or recipient is responsible to pay;
D. Divide the transfer without consideration by the standard of assistance (plus any monthly medical costs) and drop any decimal places from the result;
E. This equals the number of months of ineligibility;
F. The period of ineligibility for financial assistance shall be equal to the total period resulting from dividing the uncompensated value of the transfer by the current standard of assistance.
3.210.47 Living Arrangements
If there has been a change in the applicant's or recipient's living arrangements since the date of transfer, the standard of assistance shall reflect the living arrangement applicable during the period of amortization. To determine the standard of assistance for an institutionalized applicant or recipient, see the SSI financial eligibility requirements section in the Colorado Department of Health Care Policy and Financing's Medical Assistance manual (10 CCR 2505-10).
3.210.48 Recalculation of Period of Ineligibility
Upon the request of any applicant or recipient who has been discontinued or denied assistance because of a transfer without fair consideration, the county department shall re-compute the amortization time period when there is a subsequent increase in the standard of assistance or in the applicant's or recipient's monthly medical care costs. The county shall notify the applicant or recipient of any change in the period of ineligibility.
3.210.49 Eligibility for Long-Term Care
To determine the effect of a transfer without fair consideration in regard to eligibility for long term medical assistance, refer to the Colorado Department of Health Care Policy and Financing's Medical Assistance manual (10 CCR 2505-10) section on SSI Financial Eligibility Requirements.
3.220 CONSIDERATION OF RESOURCES
3.220.1 COUNTABLE RESOURCES (NOT APPLICABLE TO COLORADO WORKS)
3.220.11 Resource Limit [Rev. eff. 8/1/05]
Unless otherwise specified, a resource is countable, and together with all other countable resources of the applicant, recipient, or family, must be considered against the applicable assistance program resource limit. The resource limit is $2,000 for an individual and $3,000 for a couple.
3.220.12 Definition [Rev. eff. 9/15/12]
The "countable resources" include cash on hand or in a savings or checking account, and the equity value of:
A. Real property not used as the home and not exempt as income producing;
B. Personal property in the form of a mobile home, trailer, or the like, not used as the home and not exempt as income producing;
C. One motor vehicle per couple is exempt if it is equipped for a handicapped person, it is used to obtain medical treatment, or it is used for employment; otherwise, exemption of a motor vehicle for the applicant's, recipient's, or couple's use is limited to the first $4,500 of the current market value of such vehicle;
D. Stocks, bonds, and mutual fund shares;
E. Mortgages, notes and similar properties that can be converted to cash;
F. The total cash surrender value of life insurance policies that have a total original face value of more than $1,500 (not applicable to OAP);
G. The amount of a prepaid revocable funeral contract or burial expense trust deposit in excess of $1,500, plus any interest accrued on the amount in excess of $1,500;
H. The value of the burial space in excess of that required to meet the burial needs of the immediate family even if not living in the home (exemption applies to each member of the immediate family even if not living in the home);
I. Cash benefits received as proceeds of fire or casualty insurance in excess of the expenses incurred to repair or replace property which was damaged, destroyed, lost, or stolen;
J. Proceeds of a loan not expended to meet the purpose of the loan (considered a resource when such loan is a bona fide debt with a definite repayment schedule);
K. Proceeds from sale of the home property which are in excess of expenses incurred to purchase or build a replacement home; proceeds from the sale of a property item other than the home;
L. Any increase in the value of monies (or other non-exempt property acquired with such monies) received, incorporated herein by reference, "Civil Liberties Act of 1988", P.L. No. 100-383, (by eligible persons of Japanese ancestry or certain specified survivors, and certain eligible Aleuts). This rule does not contain any later editions of those parts. Copies of these regulations are available from : Colorado Department of Human Services, Division of Aging and Adult Services, 1575 Sherman, Denver, Colorado 80203, or at any state publication depository library.
3.220.2 EXEMPT RESOURCES (NOT APPLICABLE TO COLORADO WORKS)
3.220.21 Vehicle [Rev. eff. 9/15/12]
One motor vehicle per couple is exempt if it is equipped for a handicapped person, it is used to obtain medical treatment, or it is used for employment; otherwise, exemption of a motor vehicle for the applicant's, recipient's, or couple's use is limited to the first $4,500 of the current market value of such vehicle.
3.220.22 Household Goods and Personal Effects [Rev. eff. 9/15/12]
Household goods and personal effects such as furnishings, appliances, and equipment used in the home, clothing, and personal jewelry with a total value of $2,000 shall be exempt.
3.220.23 Home as Principal Place of Residence
A home is any property in which an applicant or recipient (and spouse, if any) has an ownership interest and which serves as the applicant's or recipient’s principal place of residence. This property includes the shelter in which an applicant or recipient resides, the land on which the residence is located, and related outbuildings.
The home is not a countable resource regardless of its value. When there is an income producing property located on the home property, the income producing resource does not qualify under the home exemption unless assessed collectively with the home.
3.220.24 Absences from Home
Absences of the applicant, recipient or spouse from the home for trips, visits and hospitalizations, medical reasons or nursing home placements do not affect the home exemption as long as the applicant, recipient, or spouse intends to return home whether or not the applicant, recipient, or spouse actually returns home. An applicant or recipient individual who has been institutionalized for a period of six (6) months or more shall retain the principal place of residence as the home property, if the applicant or recipient intends to return to the exempted property for any reason. This intent to return home applies to the home the applicant, recipient or spouse was living in prior to being institutionalized or the replacement home as long as a spouse or dependent relative of the applicant or recipient continues to live there.
Such intent is documented by the following:
A. A written statement from the applicant or recipient of the intent to return home (even if to die); or B. A written statement from the applicant's or recipient's authorized representative of the applicant's or recipient's intent to return home.
An absence of any duration is considered temporary so long as the applicant's or recipient's spouse or dependent relatives continue to live in the home. The case file shall contain a statement that the spouse or dependent relative continues to reside in the home, the relationship of the individuals, the basis of the dependency (e.g., financial, medical, etc.) and the reason for the absence therefrom.
For the purpose of this section, a relative is defined as son, daughter, grandson, granddaughter, stepson, stepdaughter, in-laws, mother, father, stepmother, stepfather, half-sister, half-brother, niece, nephew, grandmother, grandfather, aunt, uncle, sister, brother, stepsister, and stepbrother. An arrangement by an applicant or recipient for occupancy of the home by another person, either on a rental basis, rent free, or in exchange for home maintenance, during a period of temporary absence shall not affect the home property exemption.
3.220.25 Absences for More than Six Months
In instances where an applicant's or recipient's absence from the home to a place other than a general medical institution is greater than six (6) months, the county department shall determine whether the recipient has established another principal place of residence. Only one residence at a time can be regarded as the principal place of residence. When evidence exists that the applicant or recipient has established a new place of residence, other than a medical institution, the county department shall obtain a signed statement indicating which of these is the applicant's or recipient's permanent residence and, if different from the exempted home property, when the applicant or recipient intends to return home. Sometimes a determination of principal place of residence is difficult to secure due to conflicting evidence. In these instances other sources shall be used to make a decision; such as voting address, tax return address, addresses for Social Security and Medicare benefits, physician's statement, guardian's statement, representative payee statement, or the applicant's or recipient's address on driver's license, car registration or checkbooks. The county department shall weigh the evidence secured from the above sources to determine the principal place of residence.
3.220.26 Change in Exemption of Principal Place of Residence
If an applicant's or recipient's home can no longer be excluded due to a change in an applicant's or recipient's principal place of residence, the equity value of the property must be counted as a resource in accordance with these rules.
3.220.3 PROPERTY ESSENTIAL TO SELF-SUPPORT (Not applicable to Colorado Works)
3.220.31 General Rule
Part or all of the value of property may be exempt if it is essential to the self-support of the applicant or recipient. The types of property eligible for this exemption are the following:
A. Property used in a trade or business; or, B. Property which is used by the applicant or recipient as an employee; or, C. Non-business property used to produce goods or services necessary for the applicant's or recipient's daily activities; or, D. Non-business, income-producing property.
3.220.32 Property Used in a Trade or Business
If an applicant or recipient is currently engaged in a trade or business, none of the property that is used in that trade or business is a countable resource. This exemption is effective as of May 1, 1990.
A. To be considered a valid trade or business, the activity must be (1) currently ongoing rather than in the stage of preparation or inactivity, and (2) intended to make a profit. An applicant or recipient who is engaged in a trade or business is self-employed.
B. The liquid resources (e.g., cash, funds in a checking account) considered necessary for use in the trade or business shall not exceed three times the average monthly cash expenditure for operating the business, unless there is a documented need for a larger amount.
3.220.33 Property That is Used by the Applicant or Recipient as an Employee
The entire value of any property that is used by the applicant or recipient in connection with the applicant's or recipient's current employment by another (as opposed to self-employment in a trade or business) is not counted as a resource. Examples of such property include the tools of a tradesman, safety equipment, and uniforms, but do not include a motor vehicle which is used for transportation to and from work.
3.220.34 Non-business Property Used to Produce Goods or Services Necessary for the Applicant's or Recipient's Daily Activities A maximum of $6,000 of the equity value of such property is not counted as a resource. Any equity value in excess of $6,000 is a countable resource. Examples of this type of property include land which is used to produce vegetables or livestock only for personal consumption in the applicant's or recipient's household, and personal property necessary to perform daily functions (e.g., a garden tractor), but do not include motor vehicles, boats or other special vehicles.
3.220.35 Temporary Interruption in Use of Property
If property has been but is not currently in use for one of the purposes described in the three preceding sections, the exemption for such property shall continue for 12 months (24 months where nonuse is due to a disabling condition) if there is a reasonable expectation that the previous use of the property will resume within that time.
3.220.36 Non-Business, Income-Producing Property
If an applicant or recipient owns non-business, income-producing property, a maximum of $6,000 of the equity value of such property is an exempt resource, as long as the property produces a net annual income of at least 6% of the excluded equity. If the equity value of such income- producing, non-business property exceeds $6,000, only the equity value above $6,000 will be counted as a resource. If there is more than one potentially exempt property, the rate-of-return requirement applies individually to each. However, the total combined exemption for all such properties shall not exceed $6,000.
A. "Non-business" means that the property is not used in a trade or business as defined in Section 3.220.32. Examples of non-business, income-producing property are houses or apartments for rent, and land other than home property.
B. If non-business, income-producing property is not producing net income of at least 6% of the excluded equity, the entire equity value is counted as a resource. However, the exemption for up to $6,000 of the property's equity may continue if the property is earning less than 6% due to circumstances beyond the applicant's or recipient's control (e.g., crop failure, illness, etc.), and there is a reasonable expectation that, within 24 months, the property will again produce a 6% return.
C. A permit, license, or other similar authority granted by a governmental agency to engage in an income-producing activity is not a countable resource.
3.220.37 Examination of Tax Records
In order to help determine whether property is currently being used in a trade or business, or whether property is producing income, obtain a copy of the most recent tax returns (form 1040 and appropriate schedules) from the applicant or recipient. If a return has not yet been filed, obtain a current estimate of income and a copy of the previous year's return.
3.220.4 PROPERTY REPLACEMENT EXEMPTIONS
3.220.41 Proceeds from Fire or Casualty Insurance
Proceeds from fire or casualty insurance shall be considered exempt to the extent that they are used to restore or replace an exempt resource. This exemption shall be allowed for up to 3 months for restoration or replacement of exempt personal property and 6 months for restoration or replacement of exempt real property.
3.220.42 Proceeds from Sale, Relocation, or Condemnation of Principal Place of Residence Proceeds from sale of the home property, relocation payments, or condemnation awards from a governmental agency shall be considered exempt to the extent that they are used to purchase or build a replacement home. This exemption is allowed for up to 6 months. Proceeds of a home sale are the net payments received by the seller after satisfaction of all actual encumbrances and sales expenses.
3.220.43 Time Limits
The time periods specified above begin with the date the applicant or recipient receives such proceeds.
3.220.44 Determination of Replacement Exemption
Establishing that the replacement exemption applies, and the time period for the exemption, requires:
A. Obtaining appropriate documentation to verify the amount of proceeds and date they were received, and B. Verifying that the proceeds are to be used for restoration or replacement of exempt property by obtaining the applicant's or recipient's signed statement to that effect.
3.220.45 Verification of Restoration or Replacement
The applicant or recipient must be contacted upon the expiration of the allowable time period to verify that restoration or replacement has occurred. Restoration or replacement shall be considered to occur when payment for such is made or contracted in writing to be made.
3.220.46 Countable Proceeds
When the allowable time period ends, proceeds in excess of payments made or contracted to be made must be counted as a resource as of the month following the month in which the time period expired.
3.220.5 BURIAL CONTRACT OR TRUST DEPOSIT (Not applicable to Colorado Works)
3.220.51 Irrevocable Prepaid Contract or Irrevocable Trust for Burial Expenses
For the purpose of determining eligibility for financial assistance, an applicant or recipient may own an irrevocable prepaid contract for burial expense or, as an alternative, may set up an irrevocable trust for burial expense, without such contract or trust affecting the applicant's or recipient's eligibility for assistance. Irrevocable means that the contract cannot be terminated, sold, or transferred.
3.220.52 Irrevocable Prepaid Contract or Revocable Trust for Burial Expenses
For the purpose of determining eligibility for financial assistance, if an applicant or recipient, does not own an irrevocable funeral contract, the applicant or recipient may own a revocable prepaid contract or trust for burial expenses not to exceed $1,500. Such contract or trust does not affect the applicant's or recipient's eligibility for assistance. For the purpose of evaluating a prepaid revocable burial contract, the following shall apply:
A. Only the paid-up amount of the contract, not the face value, is taken into consideration;
B. The interest on the exempt $1,500 is also exempt;
C. Revocable means that the contract can be terminated, sold, or transferred.
3.220.53 Determination of Exemption
For the purpose of evaluating a trust deposit for burial expense, the $1,500 exemption applies only when the trust:
A. Is made with a federally insured bank or savings and loan association, or with a trust company under supervision of the State Banking Commissioner;
B. Is revocable during the lifetime of the applicant or recipient and is to be paid by the trustee only upon death of the applicant or recipient for the purpose of burial expense; and, C. Provides for payment of the trust funds without limitation as to place of burial or provider of related services unless the trust was established prior to November 1966. In any case, however, the applicant or recipient is not precluded from indicating a preference as to place of burial or provider of related services.
3.220.54 Burial Spaces
The value of burial spaces required to meet the burial needs of the immediate family, even if not living in the home, are exempt. The immediate family includes the applicant's or recipient's spouse, minor and adult children, stepchildren, adopted children, brothers, sisters, parents, adoptive parents, and the spouses of those persons.
3.230 PROPERTY VALUATION
3.230.1 VALUE DETERMINATION
3.230.11 Documentation
The means and detail of value determination, including verification sources, must be entered on the Eligibility Review Record.
3.230.12 Sufficient Details
The applicant or recipient can usually supply all or most of the needed documentation. Entries on the review record of documentary information must be in sufficient detail so that the source document is accurately reflected and can be returned to the applicant or recipient for safekeeping.
3.230.13 Authorization to Contact a Collateral Source
The applicant's or recipient's authorization must always be obtained for the county department to contact a collateral source for valuation information or verification.
3.230.14 Right to Protest Determination
An applicant or recipient may protest any value determination made by the county department and may obtain another appraisal or valuation that must be considered; however, the responsibility for the decision on the value determination rests with the county department.
3.230.15 Verification
The current amount in a savings or checking account is determined by verifying the balance in the account:
A. From a passbook or a copy of a current statement of the account, or B. With the bank, credit union, or savings and loan association by phone or in writing.
3.230.16 Authorization to Contact Additional Banks
A county department may selectively contact one or more local banks to establish whether an applicant or recipient has any bank account or has an account in addition to one declared. The applicant's or recipient's authorization must be obtained to make such contacts.
3.230.17 Disclosure of Safety Deposit Box Contents
An applicant or recipient must disclose the contents of a safety deposit box on request of the county department. The value of the contents is determined by obtaining any necessary valuations for countable items.
3.230.2 EQUITY VALUE OF REAL PROPERTY FOR OAP-A, OAP-B, AND, AB, AND AND/AB/SSI-CS
3.230.21 Definition
For OAP-A, OAP-B, AND, AB, and AND/AB/SSI-CS, equity value of real property means actual value less encumbrances (legal debts). To determine equity value, first determine actual value, then subtract the encumbrances as defined below.
3.230.22 Actual Value
Actual value of real property may be obtained by using the actual value reported by a county assessor or from the most recent property assessment notice. If the actual value is not on the assessment notice, it may be determined by dividing the assessed value, as shown on the property assessment notice, by the appropriate percentage value for residential or non-residential property as established by state law.
The assessed value shall be verified: (1) from a copy of the most recent property assessment notice, or (2) with the county assessor's office by phone, personal contact, or in writing.
3.230.23 Encumbrances
Encumbrances include mortgages, liens, judgments, delinquent taxes, loan agreements, and other forms of indebtedness. Encumbrances must be verified. Only direct and documented encumbrances against a specific item or property shall be considered in determining its equity value. Verbal agreements of indebtedness shall not be accepted.
3.230.24 Determination of Equity Value of Mining Claims and Oil, Mineral or Water Rights The equity value of mining claims and oil, mineral or water rights, if assessed separately from land, is determined by using the equity value as defined above.
3.230.3 EQUITY VALUE OF PERSONAL PROPERTY
3.230.31 Property Used in Trade or Business
The actual value of any personal property which is assessed for taxation such as a mobile home, house trailer, or property used in a trade or business, is determined by using the actual value reported by a county assessor, or by obtaining a copy of the most recent property assessment notice. If the actual value is not on the assessment notice, the value may be determined by:
A. Verifying the assessed valuation: (1) from a copy of the most recent property assessment notice, or (2) with the county assessor's office by phone, or other personal contact, or in writing, and B. Converting to actual value by dividing such assessed valuation by the percentage of valuation as determined by state law.
3.230.32 Appraised Value of Personal Property Not Assessed for Taxation
The actual value of any personal property which is not assessed for taxation is determined by obtaining the appraised value less liabilities, i.e., farm equipment and livestock, inventories of merchandise and materials.
Except as specified in the succeeding paragraph, the actual value of automobiles and trucks is determined by using the "wholesale" (trade-in) value given in the current issue of a value guide publication, or a lesser value if verified by a statement from a reliable source.
3.230.33 Actual Value of Personal Property Not Assessed for Taxation
For personal property which has not been assessed for taxation and vehicles which are not listed in the value guide publication, the actual value is based on statements given by the applicant or recipient; except that, when reasonable doubt exists concerning the applicant's or recipient's stated value, the actual value is determined and based on:
A. Assessment standards obtained from the State or county motor vehicle office or county assessor's office, or B. Valuation obtained from a local merchant or dealer.
3.230.4 SECURITIES AND OTHER FINANCIAL DOCUMENTS
3.230.41 Fair Market Value
The fair market value of stocks, mutual fund shares, municipal, corporate or government bonds, and other securities is based on the price as of the opening of the market on the date their value is determined by the county department. The market prices is obtained from the published quotations in daily newspapers or by contacting a local securities firm.
3.230.42 Valuation of Over-the-Counter Stocks
The value of stocks traded over-the-counter is expressed on a "bid" and "asked" basis. In such cases, the bid price is used to determine the market value.
3.230.43 Stocks or Securities With No Locally Determinable Value
When stocks or other securities have no locally determinable value, the market value is requested from the issuing company. The Office of the Secretary of State in each state will supply information as to whether the stock is still on the market, and the address of the issuing company.
3.230.44 U.S. Savings Bonds and Treasury Notes
The current cash value of U.S. Savings Bonds, Treasury Notes, and the like is determined from the value tables appearing on the bonds themselves or by contacting a local bank.
3.230.45 Failure to Sell
Failure to sell a mortgage, promissory note or similar property at the asking price or for a reasonable value does not exempt the resource. Under such circumstances, the county department must determine whether the property could be sold for two-thirds of the actual value. If the property can be sold at two-thirds of the actual value, that amount shall be counted as the value of the resource. Property that cannot be sold at two-thirds of the actual value shall be exempt from resource consideration in accordance with Section 3.210.15, C.
3.230.46 Refusal of Two-Thirds Offer
If the adult financial or Medicaid applicant or recipient receives an offer for at least two-thirds of the actual value and refuses to sell the property, the property shall not be exempted.
3.230.47 Right to Establish Lesser Value
The applicant or recipient shall have the right to submit evidence establishing a lesser property value. Such value may be established to be zero. The county department shall evaluate the evidence and redetermine the property value.
3.230.5 LIFE INSURANCE
3.230.51 Face and Cash Surrender Value
The owner of a life insurance policy is the only individual who can receive the proceeds under the cash surrender provisions of the policy. Life insurance policies owned by the applicant or recipient must be evaluated for original face value at the time of purchase and cash surrender value.
3.230.52 Types of Policies
Most term life insurance carries no cash surrender value. However, such policies should be reviewed to determine if a cash surrender value exists. The following types of life insurance carry a cash surrender value:
A. Whole life, also known as ordinary life or straight life;
B. Limited payment life; and, C. Endowment.
3.230.53 Cash Surrender Value of Whole Life Policies
Whole life insurance policies have a cash surrender value usually after the second year.
3.230.54 Calculation of Cash Surrender Value
Most insurance policies that permit cashing-in have a section explaining the option and a table of values that are payable. The cash surrender value may be figured by using the table value as of the last anniversary date.
3.230.55 Obtaining Written Valuation
When the insurance policy does not provide needed information, or the owner has borrowed on the policy, the policy has lapsed or the status of the policy is otherwise in question, information regarding any current cash surrender value which may affect eligibility must be obtained by writing to the insurance company.
3.230.56 Determining Original Face Value
The original face value of a policy may be increased because of dividends and reinvestment of dividends. This increased face value is not used to determine eligibility. The original face value of the policy is the figure to be used to determine if the cash surrender value of the policy is exempt.
3.240 INCOME PROVISIONS
3.240.1 DETERMINING MONTHLY INCOME (Not applicable to Colorado Works)
3.240.11 Definition
"Income", in general, is the receipt by an applicant or recipient of a gain or benefit in cash or in- kind during a calendar month.
3.240.12 In-Kind Income
In-kind income must be something of value received for the applicant's or recipient's own benefit in providing the basic requirements of food, shelter, utilities, clothing and other needs as specified under the standards of assistance.
3.240.13 Income Counted in Month Received
Income of an applicant or recipient shall be counted as income in the month it is received or is expected to be received, unless the income is averaged or prorated as provided in a subsequent paragraph of this section.
3.240.14 When Income is Received
"Received", as is used in the preceding paragraphs, means "actually" received or legally becomes available, whichever occurs first; that is, the point at which the income first is available to the applicant or recipient to use.
3.240.15 Anticipated Income
Income which can be anticipated with reasonable certainty concerning the amount and month in which it is to be received shall be counted.
3.240.16 Expected Monthly Income
Generally, the expected monthly income amount is based on the income received in a previous month; except that, when the previous month does not provide an accurate indication of anticipated income, or under circumstances as specified below, a different period of time may be applicable:
A. For new or changed income, a period shorter than a month may be used to arrive at a projected monthly amount;
B. For contract employment in cases, such as in some school systems, where the employees derive their annual income in a period shorter than a yea, the income shall be prorated over the term of the contract, provided that the income from the contract is not earned on an hourly or piecework basis;
C. For regularly received self-employment income, net earnings will usually be prorated and counted as received in a three (3) month period, except for farm income. For further information see section on self-employment under countable earned income.
D. For all other cases where receipt of income is reasonably certain but the monthly amount is expected to fluctuate a period of 12 months shall be used to arrive at an average monthly amount;
E. For income from rental property to be considered as self-employment income the recipient must actively manage the property at least an average of 20 hours per week. Income from rental property will be considered as unearned income if the applicant or recipient is not actively managing the property an average of at least 20 hours per week. Rental income, as self-employment or as unearned income, shall be averaged over a 12 month period to determine monthly income. Income from jointly owned property must be considered as a percentage at least equal to the percentage of ownership or, if receiving more than percentage of ownership, the actual amount received;
F. For cases where a change in the monthly income amount can be anticipated with reasonable certainty, such as with Social Security cost-of-living increases, or other similar benefit increases, the expected amount shall be considered in arriving at countable monthly income for the month received.
3.240.2 FINANCIAL RESPONSIBILITY OF RELATIVES (Not applicable to Colorado Works)
3.240.21 Family Groups
In family groups living together, income of one spouse is considered available for the other spouse and income of a parent (or spouse of a parent) is considered available for unemancipated children except that, if a spouse or parent is receiving assistance under another category of public assistance, SSI benefits, or medical assistance, the income shall not be considered as available to the other spouse or to the children.
For the purposes of this rule, "unemancipated child" means (1) a child under age 18 who is living in the same household with a parent or spouse of a parent, or (2) a child under age 21 who is living in the same household with a parent or spouse of a parent, if the child is regularly attending a school, college, or university, or is receiving technical training designed to prepare the child for gainful employment.
3.240.22 Non-Recipient Spouse (NRS)
Non-recipient Spouse Income (NRSI) consists of all countable earned and unearned income received by the non-recipient spouse. Non- recipient Parental Income (NRPI) consists of all countable earned and unearned income received by the non-recipient parent and the spouse of the non-recipient parent.
3.240.23 NRS Income Determination
For the purpose of determining the amount of income available to a spouse or unemancipated child who is an applicant or recipient, the countable earned income of the non-recipient spouse (NRS), non-recipient parent (NRP), or non-recipient spouse of a NRP, shall be computed monthly as follows:
A. Determine the amount of gross earned income. From this amount, deduct $65 plus one/half (1/2). The remainder is the amount of earned income deemed to the applicant or recipient.
B. The remainder (after the above deductions) shall be considered income to the applicant or recipient and shall be deducted, together with any other income, from the grant of the applicant or recipient.
C. When there is a categorical change of assistance to the recipient, the NRSI or NRPI shall be recomputed.
3.240.24 Determination of Available Income to Spouse and Unemancipated Child
For the purpose of determining the amount of income available to a spouse or unemancipated child who is an applicant or recipient, the countable unearned income of the NRS, NRP, or non- recipient spouse of a NRP, shall be computed monthly as follows:
A. Determine the total amount of unearned income of the non-recipient spouse or NRP;
B. Deduct, for the needs of the NRS or NRP, an amount equal to the standard of assistance for the category of assistance being applied for or being received by the applicant or recipient;
C. Deduct an amount to meet the needs of dependent children of the NRS or NRP equal to one/half the maximum SSI individual benefit level less the dependent child(ren)'s own income;
D. Deduct any medical care payments by the NRS or NRP for the NRS or NRP or his/her dependents which are not covered by Medicare, Medicaid, or other health programs;
E. With the exception of garnishment, deduct any amount of obligation of the NRS or NRP due to orders of judgment or for support by a court.
The remainder (after the above deductions) shall be considered income to the applicant or recipient and shall be deducted, together with any other income, from the grant of the applicant or recipient.
When there is a categorical change of assistance to the recipient, the NRSI or NRPI shall be recomputed.
3.240.25 Earned and Unearned Income
When the NRS, NRP, or non-recipient spouse of a NRP, has income consisting of both countable earned and unearned income the countable earned income shall have the $65 deduction, then the remainder is divided in half (1/2). The unearned income shall have the appropriate unearned income disregard applied. Add the earned and unearned income remainders together; this total is the amount of deemed income to the applicant or recipient.
3.240.26 Income Greater Than the Assistance Grant
If the NRSI or NRPI is greater than the assistance grant or is greater when added to the applicant or recipient's other income, the applicant or recipient shall be determined ineligible.
3.240.27 Dispute in Calculation of Attributable Income
If an applicant or recipient disagrees with the amount determined to be attributable as income or alleges that such income actually is not available, the county department shall:
A. In the instance of disputed amount attributable as income request the applicant or recipient to provide documentation that the amount used in the non-recipient spouse income computation is incorrect. If such documentation established that an incorrect computation has taken place an immediate correction and adjustment shall be made;
B. In the instance of allegation that attributable income from the non-recipient spouse actually is not being received, the county department shall undertake a determination of the facts. If it is verified that the allegation is, in fact, true, the non-recipient spouse income deduction shall be suspended while corrective actions to assure such receipt are being sought or implemented. The case shall be referred to the county attorney for corrective action.
3.240.3 DISTINGUISHING EARNED INCOME FROM UNEARNED INCOME (Not applicable to
Colorado Works)
3.240.31 Definitions
To distinguish earned income from unearned income to determine which income exemptions, disregards, and/or deductions apply:
A. "Earned income" means payment in cash or in kind received by an applicant or recipient for services performed as an employee or as a result of the applicant or recipient being engaged in self-employment;
B. "Unearned income" means any income that is not earned through employment or self- employment.
3.240.4 NET DEDUCTIBLE EARNED INCOME (NDEI)
3.240.41 For the purpose of grant determination the countable earned income is referred to as the Net Deductible Earned Income (NDEI). The NDEI is the result of subtracting applicable earned income disregards from gross earned income.
3.250 CONSIDERATION OF INCOME
3.250.1 COUNTABLE EARNED INCOME
3.250.11 Consideration Against Assistance Program Standard
Unless otherwise specified, any earned income is countable and the applicable net deductible earned income amount (NDEI) together with all other countable income of the applicant, recipient, or family must be considered against the applicable assistance program standard. The procedure for such consideration in relation to standards of assistance are specified in the chapters covering the different programs.
3.250.12 Determining the Net Deductible Earned Income (NDEI)
The amount of wages, salaries, or commissions available to the applicant/recipient after the applicable disregards is the net deductible earned income (NDEI).
A. Wages, salaries, and commissions mean all payments for services as an employee, or money payments obligated to the employee and diverted to a third party for the employee's household or other expenses.
B. Wages that are being garnished by a court order are classified as earned income.
C. With the exception of contract employment, wages which are paid to an employee for a period for which services were rendered must be counted as earned when paid rather than when earned, except that wages held at the request of the employee are considered income in the month they would otherwise have been paid.
3.250.13 Self-Employment [Rev. eff. 9/15/12]
An individual involved in a profit making activity shall be classified as self-employed.
A. To determine the net profit of a self-employed applicant or recipient deduct the cost of doing business from the gross income.
B. Appropriate allowances for cost of doing business for applicants or recipients who are licensed, certified or approved day care providers are (1) for the first child for whom day care is provided, deduct $55 and (2) for each additional child deduct $22. If the applicant or recipient can document a cost of doing business which is greater than the amounts above set forth, the procedure described in A-1, shall be used.
C. The resultant net profit amount, secured after the appropriate deductions described above, shall be treated as set forth in the OAP or AB/AND.
3.250.14 Irregular Receipt of Self-Employment Income [Rev. eff. 9/15/12]
Irregular receipt of self-employment income shall be averaged over a 12 month period.
3.250.15 Other Types of Self-Employment Income
Some different types of self-employment income and how considered include, but are not limited to, the following:
A. Farm Income - shall be considered on a yearly basis. Net income for the prior year shall be determined and averaged for the succeeding year. When an applicant or recipient ceases to farm, the income is no longer deducted.
B. Rental income - shall be considered as self-employment income only if the applicant or recipient actively manages the property at least an average of 20 hours per week. Rental income shall be averaged over a 12 month period to determine monthly income.
C. Board (to provide a person with regular meals only) payments shall be considered earned income in the month received to the extent that the board payment exceeds the maximum food stamp allotment for a one-person household per boarder and other documentable expenses directly related to provision of board.
D. Room (to provide a person with lodging only) payments shall be considered earned income in the month received to the extent that the room payment exceeds documentable expenses directly related to the provision of the room.
E. Room and board payments shall be considered earned income in the month received to the extent that the payment for room and board exceeds the food stamp allotment for a one- person household per room and boarder and documentable expenses directly related to the provision of room and board.
3.250.16 Donated Services
A. Donated in-kind countable earned income shall be defined as services donated without pay by an applicant or recipient that:
B. If donated services meet these requirements, the value of these services is determined by:
C. The applicant or recipient shall be informed that the continuation of donation of services will result in an income deduction from the assistance grant after all applicable earned income disregards have been applied.
3.250.17 In-Kind Income in Exchange for Employment
In-kind income received in exchange for employment is employment income and shall have the appropriate earned income disregards applied to the total value of the income. The amount considered as earned income when an applicant or recipient is paid in-kind is the value of the item supplied. The current market value of the item is used if the value of the item is not provided.
3.250.2 COUNTABLE UNEARNED INCOME
3.250.21 Consideration Against Assistance Program Standard
Unless otherwise specified, any unearned income is countable and together with all other countable income of the applicant, recipient, or family must be considered against the applicable assistance program need and/or grant standards specified in the chapters covering the different programs.
3.250.22 In-Kind Support and Maintenance (ISM)
For certain applicants or recipients receiving OAP, AB/SSI-CS, or AND/SSI-CS and not paying their fair share of housing costs, an In-kind Support and Maintenance (ISM) amount must be determined and counted as unearned income. The maximum amount of ISM to be charged to the applicant or recipient shall not exceed the applicable amount of the shelter and utility component as described in the OAP or AND/AB/SSI-CS grant standards. This component is adjusted annually. The ISM provisions do not apply to the following for an applicant or recipient:
A. Residing in and owning their own homes;
B. Residing in subsidized housing;
C. Receiving state AND or State AB;
D. Receiving Colorado Works;
E. With a life estate established on their homes;
F. Considered to be boarders; or, G. Considered to be homeless.
3.250.221 Shelter Costs
3.250.222 In-Kind Items Other Than Shelter
3.250.23 Countable Unearned Income [Rev. eff. 9/15/12]
Countable unearned income includes but is not limited to the following, as well as other payments, from any source whatever, which can be construed to be a gain or benefit to the applicant or recipient and which are not earned income:
A. Inheritance, gifts, and prizes;
B. Dividends and interest received on savings bonds, leases, etc.;
C. Income from rental property is considered as unearned income where the applicant or recipient is not actively managing the property on an average of at least 20 hours a week. Rental income is countable to the extent it exceeds allowable expenses. Allowable expenses are maintenance, taxes, management fees, interest on mortgage, and utilities paid, and do not include the purchase of the rental property and payments on the principal of loans for rental property.
D. Educational loans and grants which are not exempt; the countable amount, after deduction of expenses necessary for school attendance, must be prorated over the period of months intended to be covered by the loan or grant; specific instructions for determining the countable amount are contained in the section on "Educational Loans and Grants";
E. VA educational assistance (G.I. Bill) payments or any other benefits which are conditional upon school attendance are income to the extent that they exceed expenses necessary for school attendance; specific instructions for determining the countable amount are contained in the section on "Educational Loans and Grants";
F. Proceeds of a life insurance policy to the extent that they exceed the amount expended by the beneficiary for the purpose of the insured recipient's last illness and burial which are not covered by other benefits;
G. Proceeds of a health insurance policy or personal injury lawsuit to the extent that they exceed the amount to be expended or required to be expended for medical care;
H. Strike benefits;
I. Income from jointly owned property - in a percentage at least equal to the percentage of ownership or, if receiving more than percentage of ownership, the actual amount received;
J. Lease bonuses (oil or mineral) received by the lessor as an inducement to lease land for exploration are income in the month received;
K. Oil or mineral royalties received by the lessor are income in the month received;
L. (Not applicable to Colorado Works) OASDI or SSI benefits received by an applicant or recipient shall be considered income in the month received.
M. income derived from monies (or other property acquired with such monies) received pursuant to the "Civil Liberties Act of 1988", P.L. 100-383, (by eligible persons of Japanese ancestry or certain specified survivors, and certain eligible Aleuts).
N. Amounts withheld from unearned income because of a garnishment are countable as unearned income.
3.250.24 Lump Sum Payments to SSI Recipients [Eff. 11/1/87]
SSI recipients who receive a lump sum payment shall not lose medical benefits, but a recovery shall be established for financial assistance received in the month the lump sum payment is also received.
A recovery of financial and medical benefits shall be established for OAP-A and OAP-B recipients if the lump sum payment is received too late in the month to adjust the assistance paid to the recipient. A recovery shall be established in accordance with the rules found in the recovery of overpayments section of this manual.
3.250.25 Periodic Payments [Rev. eff. 9/15/12]
The following types of periodic payments are among those included in countable unearned income:
A. Annuities - payments calculated on an annual basis which are in the nature of returns on prior payments or services; they may be received from any source;
B. Pension or retirement payments - payments to an applicant or recipient following retirement from employment, such payments may be made by a former employer or from any insurance or other public or private fund;
C. Disability or survivor's benefits - payment to an applicant or recipient who has suffered injury or impairment, or, to such applicant's or recipient's dependents or survivors; such payments may be made by an employer or from any insurance or other public or private fund;
D. Worker's Compensation payments - payments awarded under federal and state law to an injured employee or to such employee's dependents; amounts included in such awards for medical, legal, or related expenses incurred by an applicant or recipient in connection with such claim are deducted in determining the amount of countable unearned income;
E. Veteran compensation and pension - payments based on service in the armed forces; such payments may be made by the U.S. Veterans Administration, another country, a state or local government, or other organization. Any portion of a VA pension which is paid to a veteran for support of a dependent shall be considered countable unearned income to the dependent rather than the veteran.
F. Unemployment Compensation - payments in the nature of insurance for which one qualifies by reason of having been employed and which are financed by contributions made to a fund during periods of employment;
G. Railroad retirement payments - payments, such as sick pay, annuities, pensions, and unemployment insurance benefits, which are paid by the Railroad Retirement Board
H. Social Security benefits - old age (or retirement), survivors and disability insurance payments (OASDI or RSDI) made by the Social Security Administration; also included are special payments at age seventy-two (72) (Prouty benefits) and Black Lung benefits;
I. Supplemental Security Income (SSI) - public assistance payments made by the Social Security Administration to an applicant or recipient age sixty five (65) or older, or who is blind or disabled; such payments are considered in accordance with requirements specified in the applicable assistance program chapter.
3.250.251 Supplementary Medical Insurance Benefits (SMIB)
3.250.26 Trusts
A trust which benefits a Financial/Medicaid applicant or recipient shall be submitted to the State Department of Health Care Policy and Financing for determination as income or resources in accordance with the Department of Heath Care Policy and Financing Manual, Section 8.110.52 (10 CCR 2505-10).
3.250.27 Military Allotment
A military allotment received on behalf of an applicant or recipient for those individuals included in the budget unit shall be considered as income in the month received. The military allotment received by the non-recipient spouse, parent, or stepparent on behalf of individuals not in the assistance unit shall be considered as income in the month received to the extent that such income exceeds the need standard concerning those persons not in the budget unit.
3.250.28 Life Care Agreement
A life care agreement is an estate planning procedure where the applicant or recipient transfers real property to another individual but retains the right of occupancy and income from this property during the applicant's or recipient's lifetime. If the applicant or recipient's shelter is being provided in full, the shelter component shall be deducted from the assistance grant. This deduction shall not exceed the shelter component.
3.250.29 Congregate Home
An applicant or recipient may purchase occupancy in a church sponsored, non-profit congregate home for the aged or individual private owner home. If the applicant's or recipient's shelter is being provided in full in such an arrangement, the amount of the shelter component shall be deducted as income from the grant.
3.250.3 EXEMPT INCOME
3.250.31 Income Taxes
Since income taxes are included when determining the amount of countable income of an applicant or recipient, a refund of such taxes shall not be counted as income in the month received. Any amount retained into the following month is counted as a resource. The Earned Income Tax Credit (EIC) shall be exempt as a resource for the month in which the EIC payment is received and for the following month.
3.250.32 Third Party Payments
The value of any third-party payment for medical care or social services paid on behalf of an applicant or recipient shall be exempt. This exemption also applies to room and board furnished during medical confinement and paid for by a third party.
3.250.33 Emergency Assistance
Emergency Assistance other than home energy assistance received on a one time basis in cash or in kind from other agencies and organizations shall be exempt; except that, standards of assistance components which are supplied in full, free of any cost to an applicant or recipient are countable in an amount equal to the standard for the supplied component.
3.250.34 Energy Assistance
Home energy assistance granted to an applicant or recipient by a private non-profit organization or home energy supplier, whether in kind, by voucher, or vendor payment, is exempt income even if it duplicates the utilities standard component in full.
3.250.35 Personal Care and Home Care
Personal care or home care allowances paid to a recipient or non-recipient spouse, parent, stepparent or child, from a federal, state or local government program for in-home supportive servicing (attendant, chore, housekeeping) shall be exempt as income in determining the amount of attributable non-recipient spouse, non-recipient parent or non-recipient stepparent income. However, it shall be classified as employment income in determining the attendant's own eligibility for assistance.
3.250.36 VA Aid and Attendance
VA Aid and Attendance may be paid to qualified veterans in addition to their regular VA benefit. VA Aid and Attendance is exempt income to the applicant or recipient to determine eligibility for public assistance in the applicant's or recipient’s own home, if used for medical supplies and medical or attendant care not covered by Medicare or Medicaid, or other health insurance programs. The remainder is deducted from the assistance grant. (Amounts for attendant care are treated in the same manner as specified in the preceding paragraph.)
3.250.37 General Assistance [Rev. eff. 9/15/12]
General Assistance granted to an applicant/recipient by the county department prior to or as a supplement to categorical assistance is exempt income, except as it duplicates the full component item in the standards. That duplicate component item may be recovered following the recovery regulations found in the Administrative Procedures section of this rule manual.
3.250.4 EDUCATIONAL LOANS AND GRANTS (NOT APPLICABLE TO COLORADO WORKS)
3.250.41 Loans/Grants Administered by the U.S. Commissioner of Education
Any undergraduate loan or grant issued and administered by the U.S. Commissioner of Education is exempt income. Some of these grants are:
A. Basic Education Grant (PELL);
B. Secondary Educational Opportunity Grant (SEOG);
C. National Direct Student Loans (NDSL);
D. Guaranteed Student Loans (GSL); and, E. State Student Incentive Grants (SSIG).
3.250.42 Undergraduate "Need-Based" Student Aid Grants, Loans, Fellowships, and Work Study Grants [Rev. eff. 9/15/12] Undergraduate "need-based" student aid grants, loans, fellowships, and work study grants issued via the school's financial aid office are exempt income. "Need-based" grants consist of computing the student's total needs less income and available resources (including assistance grants).
3.250.43 Bureau of Indian Affairs
Bureau of Indian Affairs educational grants (BIA) to students are exempt income and may be issued in lieu of other exempt educational grants.
3.250.44 Determining Exempt Status
To determine the exempt status of an educational allowance inquiry of the school's financial officer is used to determine if the grant is:
A. Made to an undergraduate student;
B. Made or insured by the U.S. Commissioner of Education;
C. Made as a part of a "need-based" package;
D. Made by the BIA.
3.250.45 Consideration of Other Grants/Loans
All graduate student grants/loans and undergraduate grant/loans not previously disregarded are considered as follows:
A. If the grant/loan conditions specify its use is for educational expenses only, it is considered exempt;
B. If the grant/loan does not specify use of funds, allow any educational expenses (including child care if not available through Title XX) as exemptions. The remainder is considered as income and deducted from the assistance grant for the period of time covered by the grant/loan;
C. If the grant/loan supplies a component item in full, that component item shall be deducted from the grant.
3.250.46 Work Study Income
"Work Study" income that exceeds the "need-based" grant is earned income in the month received.
_________________________________________________________________________ Editor’s Notes Primary sections of 9 CCR 2503-1 have been recodified effective 09/15/2012. See list below. Versions and rule history prior to 09/15/2012 can be found in 9 CCR 2503-1. Prior versions can be accessed from the History link located above the rule text.
Rule section 3.000 – 3.100, et seq. has been recodified as 9 CCR 2503-1, GENERAL RULES. Rule section 3.200, et seq. has been recodified as 9 CCR 2503-2, GENERAL FINANCIAL ELIGIBILITY CRITERIA.
Rule section 3.300, et seq. has been recodified as 9 CCR 2503-3, OLD AGE PENSION. Rule section 3.400, et seq. has been recodified as 9 CCR 2503-4, AID TO THE NEEDY DISABLED AND AID TO THE BLIND.
Rule section 3.500, et seq. has been recodified as 9 CCR 2503-5, (Reserved for Future Use). Rule section 3.600, et seq. has been recodified as 9 CCR 2503-6, COLORADO WORKS PROGRAM.
Rule section 3.700, et seq. has been recodified as 9 CCR 2503-7, OTHER ASSISTANCE PROGRAMS.
Rule section 3.800, et seq. has been recodified as 9 CCR 2503-8, ADMINISTRATIVE PROCEDURES.
Rule section 3.900, et seq. has been recodified as 9 CCR 2503-9, COLORADO CHILD CARE ASSISTANCE PROGRAM.
History Sections 3.200, 3.200.4, 3.220.12, 3.220.21 – 22, 3.250.13 – 14, 3.250.23 – 25, 3.250.37, 3.250.42 eff. 09/15/2012. Section 3.200.26 repealed eff. 09/15/2012.