Reach Up cuts challenged in federal court

MONTPELIER — Vermont Legal Aid has filed a class action lawsuit in federal court against the state hoping to block a new statute that calls for a reduction in Reach Up benefits for some Vermonters.

Legislation recently signed into law by Gov. Peter Shumlin reduces the temporary cash assistance by $125 per month for as many as 860 households in Vermont.

That’s because of a provision in the approved 2016 fiscal year budget that counts $125 per month of federal Supplemental Security Income assistance, or SSI, against a family’s income when determining benefits under the state’s Reach Up program.

Department for Children and Families Commissioner Ken Schatz.

Department for Children and Families Commissioner Ken Schatz.

Under current law, an individual’s SSI disability benefits are not counted when determining a family’s Reach Up assistance. The change is part of a $1.6 million cut to the 2016 state budget.

“The approach we looked at was that we recognized that these are vulnerable families, but these families with SSI benefits did have more income available than other families (receiving Reach Up benefits),” said Ken Schatz, commissioner of the Department for Children and Families. “We geared this in such a manner to try to minimize the impact and also recognize that this approach, because it does deal with families that have more income available, was a better approach than an across-the-board cut to all families.”

But Christopher Curtis, the attorney with Vermont Legal Aid who filed the suit, said the cut to a subset of Vermonters receiving state benefits is unconstitutional.

“I think the single most striking thing about this proposed benefit cut is it singles out a distinct class of Vermonters,” he said. “That just jumps out on its face as discriminatory.”

Christopher Curtis (VPR photo)

Christopher Curtis (VPR photo)

“Supplemental security income is to meet the needs of disabled Vermonters who have very specific needs. It’s not necessarily to meet the needs of an entire household,” Curtis added. “We do not think that supplemental security income should be counted against the Reach Up grant and there’s a provision in federal law that supports that.”

Curtis said he is hoping the court will grant an injunction to stop the cut from taking effect on Aug. 1. A letter sent to Agency of Human Services Secretary Hal Cohen, asking that the state not implement the cut, did not work, he said. Cohen, according to Curtis, responded that the Legislature had acted and the administration is required to follow the law.

AHS mailed letters to 860 households last week to inform them of the pending reduction in benefits. There is no appeal process available to those impacted, Curtis said.

The lawsuit, Curtis said, makes the case that the benefit reduction violates equal protection and due process rights. Vermont receives a block grant from the federal government to fund its Temporary Assistance for Needy Families program, or TANF, and has leeway on how it distributes those funds to residents. But the latest change is discriminatory against families with a disabled adult residing in the household, he said.

“States do have flexibility as to administration of their block grants. However, what the state has done here is single out a particular set of people,” he said.

In a news release, Curtis said federal courts in Washington and West Virginia have issued injunctions in similar cases where benefits were reduced. In those cases, the benefit reductions were based on the SSI assistance received by children, not adults, Curtis said.

“Fundamentally, this is a poor tax that is being levied on very low-income Vermonters with household members who have a disability. It’s wrong, it’s unlawful and we plan to fight this cut,” he said.

State officials listened to Curtis’ concerns when crafting the proposal, Schatz said, and did not look to curb benefits based on SSI assistance to children.

“He made that point and we agreed and did not include children’s SSI benefits in this proposal,” Schatz said. “That is a big different between what Vermont did and other states.”

Curtis is also arguing that the $125 monthly reduction for some Reach Up beneficiaries is unnecessary since it was based on the need to cut state spending based on projected revenue. The general fund finished the 2015 fiscal year with a $21 million surplus, he noted.

“This benefit cut was totally unnecessary and totally avoidable. The justification was the state was in a budget crisis and had to cut. We know now that Vermont is sitting on a $21 million surplus, Curtis said. “We now know that in the scope of a budget surplus, this $1.6 million cut was totally unnecessary.”

But Schatz said the administration must now follow the law in place. “We don’t really have any choice now. This is the law passed by the Legislature,” he said. “We don’t have discretion at this point.”

Schatz said he and other state officials understand that challenges many Vermont families are facing.

“I am very sympathetic to the situation that Reach Up families are in,” he said. “It has to be challenging. Admittedly, this cut to those families will not make it easier, but they do have more income available to them than other families.”

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