Here's just the kind of dilemma the federal government seems to thrive on:
People at the poverty level, denied subsidy funds they were supposed to have gotten, win a lawsuit that grants them the money -- but in one lump sum. The payment, however, would put them over the legal poverty level and thus make them ineligible for food stamps and other programs they need. How do you let them keep the money the court awarded them, and still qualify as being poor?
The answers are laid out in the Sept. 26 Federal Register (page 63831), along with the following fascinating tale of your government in action.
In 1974, Congress voted extra money to the Department of Housing and Urban Development (HUD). The funds were to be allocated to landlords involved in rent-subsidized housing projects. The purpose was to offset increased electric and heating bills as well as higher taxes.
HUD, however, decided not to use the money Congress gave it. And so, in turn, the landlords passed the higher costs on to the poor tenants -- who dug down and paid them.
Eventually, however, the tenants, in a series of class-action lawsuits against HUD, won settlements that required the department to repay them the money they had to pay in increased rents. It was stipulated that whatever money they received would "have no adverse effect on assistance they may receive from other governmental programs."
At first the Agriculture Department's Food and Nutrition Service, which administers the food stamp program, didn't think it would have too much of a problem. Although its rules specify that a recipient cannot have more than $1,500 in liquid assets, the first information the service received was that the highest payment would be only $500 and only a few households would get that much.
Recently, however, it was determined that 24,000 households would receive over $500 and 3,000 families would get over $1,000.
Given those statistics, the service, along with the people who run the aid to dependent children program, decided that something had to be done to prevent these 24,000 families from being pushed off the federal poverty program rolls. As one official put it, "It's a lot of work to take them off and then put them back on the rolls."
The solution found was simple: the recipients are being given a two-month grace period in which the increase in their wealth -- thanks to the lawsuit payment -- will not effect their eligibility. However, if after that time they have held onto enough of the payment to make them worth more than $1,500, off the rolls they will go.
In short, "they have been given two months to spend the money so it will not impact on their program benefits," was the way one bureaucrat deftly put it.