How to Process an Overissuance

Overissuance Determined in CalSAWS

Follow these steps to process an overissuance determined in CalSAWS:

  1. Ensure that the CalSAWS entries in the Benefit Recovery subsystem are correct, such as the type of overissuance, the date of discovery, etc.
  2. Verify that the benefits were available, through EBT, in order to determine if an overissuance occurred. (There is no overissuance if the benefits were not transmitted to EBT.)

    1. Note: Verification that the CalFresh benefits were accessed is NOT required because if a client fails to access the benefits for an overissued month, the overissuance will be wiped out when the CalFresh benefits are expunged.

  3. Review the Overissuance NOAs in the Client Correspondence Subsystem to ensure that they contain the correct information and that the minimum information regarding the budget is included or added to the NOA. If so, change the Issuance from Online to Batch (Refer to Forms/Correspondences for detailed information regarding the NOA requirement).
  4. Complete the DFA 842.
    1. List up to 72 months prior to the date of discovery on the DFA 842. Use the back of the form and extra pages if necessary.
    2. If the overissuance is IHE or IPV, offset any supplemental payments which occurred in the 12 months prior to the date of discovery of the underissuance. Complete #13.
      1. Enter the total overissuance amount (before subtracting the underissuance offset) on line 13A.
      2. Enter the underissuance offset amount on line 13B.
      3. Enter the remaining overissuance amount to be collected on line 13D.
    3. In the “Documentation” Box on the right, enter the:
      1. Amount, month and year, and cause of underissuance.
    4. Include name, address, and SSN of:
      1. Any adults who were household members at the time of the overissuance.
      2. A noncitizen's sponsor.
      3. Anyone connected to the household, such as an authorized representative, who actually traffics or otherwise caused an overissuance or trafficking.
        1. It is important to list all adult household members, the sponsor, and the authorized representative because the claim may be collected from any one of these people.
    5. Under “Basis of Claim Determination”, list any overissuance which involves the client nonreporting as a Potential IPV. (This includes overissuances due to a combination of agency error and client nonreporting.)
    6. Complete the “Explanation of Overissuance”. Explain clearly the cause of the overissuance including how the household failed to report, if applicable.
    7. For “Issuance Verification”, put a check in the “other” column if the benefits for that month were transmitted.
    8. Note the following information under “Documentation Taken”:
      1. Other relevant information, such as that an adjustment cannot be made because the case is closing, or there is a change in payees.
    9. Attach verification of benefit issuance to the DFA 842 (i.e. EBT screens).
  5. Submit the case and the documents to the EW Supervisor for review and signature.
    1. The EW Supervisor must sign the DFA 842.
  6. Send DFA 842 to Imaging.

Non-System Determined Claim (NSDC)

Follow these steps to process an Non-System Determined Claim (NSDC):

  1. Is the overissuance due to earnings and it is pre-CalSAWS?
    1. If Yes, refer the overissuance to the IEVS Unit with an “Overpayment Referral” (SC 1253) or a “Communication Between IEVS Worker and Eligibility Worker” (SCD 1604) [Refer to the “IEVS Recipient System in the DEBS Business Process Handbook].
    2. If No, go to STEP 2.
  2. Verify that the benefits were available, through EBT, in order to determine if an overissuance occurred. (There is no overissuance if the benefits were not transmitted to EBT.)

    1. Note: Verification that the CalFresh benefits were accessed is NOT required because if a client fails to access the benefits for an overissued month, the overissuance will be wiped out when the CalFresh benefits are expunged.

  3. Complete the DFA 842.
    1. List up to 72 months prior to the date of discovery on the DFA 842. Use the back of the form and extra pages if necessary.
    2. If the over-issuance is IHE or IPV, offset any supplemental payments which occurred in the 12 months prior to the date of discovery of the underissuance. Complete #13.
      1. Enter the total overissuance amount (before subtracting the underissuance offset) on line 13A.
      2. Enter the underissuance offset amount on line 13B.
      3. Enter the remaining overissuance amount to be collected on line 13D.
    3. In the “Documentation” Box on the right, enter the:
      1. Amount, month and year, and cause of underissuance.
    4. Include name, address, and SSN of:
      1. Any adults who were household members at the time of the overissuance.
      2. A noncitizen's sponsor.
    5. Anyone connected to the household, such as an authorized representative, who actually traffics or otherwise caused an overissuance or trafficking.
    6. It is important to list all adult household members, the sponsor, and the authorized representative because the claim may be collected from any one of these people.
    7. Under “Basis of Claim Determination”, list any overissuance which involves the client nonreporting as a Potential IPV. (This includes overissuances due to a combination of agency error and client nonreporting.)
    8. Complete the “Explanation of Overissuance”. Explain clearly the cause of the overissuance including how the household failed to report, if applicable.
    9. For “Issuance Verification”, put a check in the “other” column if the benefits for that month were transmitted.
    10. Note the following information under “Documentation Taken”:
      1. Other relevant information, such as that an adjustment cannot be made because the case is closing, or there is a change in payees.
    11. Attach verification of benefit issuance (i.e. EBT screens).
  4. Complete a general fraud referral through the Client Referral subsystem to the District Attorney, if the overissuance involves household nonreporting. [Refer to the “Fraud” chapter in the DEBS Business Process Handbook.]
  5. Make computer entries for that portion of the overissuance listed on the front of the DFA 842, on line 13A. Do not make computer entries for an overissuance listed on the back of the DFA 842. It cannot be collected unless the overissuance is determined to be an IPV by a court of law or an ADH (Administrative Disqualification Hearing).
    1. Enter the:
      1. Overissuance adjustment.
      2. Underissuance offset, if applicable.
      3. NOA Repayment Agreement request.
      4. For an AE or IHE on an open case, make the appropriate computer entries for the adjustment of the allotment to take effect with the first month of the SAR Payment Period that begins after the 30 day period from the date of the NOAs has expired.
  6. Document in the Journal Detail page including the reason for the claim and the claim number.
  7. Use the appropriate shelf stock NOA and request the “Repayment Agreement” from CalSAWS to send to the client. Ensure that they contain the correct information and that the minimum information regarding the budget is included or added to the NOA. These must be sent, whether the CalFresh portion of the case is open or closed. Refer to Forms/Correspondences for detailed information regarding the NOA requirements.
  8. Submit the case and the documents to the EW Supervisor for review and signature.
    1. The EW Supervisor must sign all copies of the DFA 842.
  9. Send DFA 842 to Imaging.
    1. Go to STEP 10 if this is an administrative overissuance that occurred prior to 10/1/96.
    2. Go to STEP 11 if this is an administrative overissuance that occurred on or after 10/1/96 and that was established PRIOR to 3/1/00
    3. Go to STEP 12 if this is an administrative overissuance that was established on or after 3/1/00 (including claims in which the noticing requirement was met in 2/00 to begin allotment reduction in 3/00).
  10. AE OVERISSUANCE THAT OCCURRED PRIOR TO OCTOBER 1, 1996.
    1. Wait 30 days or until the repayment agreement has been returned by the client, whichever comes first.
    2. If the “Repayment Agreement” is returned by the client:
      1. And the HH chooses allotment reduction, enter the adjustment amount chosen by the HH in CalSAWS beginning with the first month of the upcoming SAR Payment Period. Send a 10-day NOA to reduce benefits, if applicable. The household is not required to repay by allotment reduction. Do not adjust unless the household indicates it wishes to repay the claim by benefit adjustment.
      2. If the HH chooses to repay by lump sum or installments, send the original DFA 842 and a copy of the “Repayment Agreement” to Public Assistance Collections.
    3. If the “Repayment Agreement” is NOT returned by the client.
      1. The household is not required to repay the overissuance by allotment reduction. Refer an overissuance over $35 (which occurred before 11/91) to Public Assistance Collections.
      2. When the overissuance is $35 or less, further action is not required until the case closes.
  11. AE OVERISSUANCE THAT OCCURRED ON OR AFTER OCTOBER 1, 1996 AND WERE ESTABLISHED PRIOR TO 3/1/00.
    1. Wait 30 days or until the repayment agreement has been returned by the client, whichever comes first.
    2. If the “Repayment Agreement” is returned by the client:
      1. If the HH chooses allotment reduction, do not change the adjustment entry already entered on the computer. A 10-day NOA is not required, unless the reduction amount and effective date are different than what was stated by the County on the overissuance NOA when it was mailed to the client.
    3. If the client wishes to repay through allotment reduction more than the amount automatically determined by the computer ($10 or 10% of the coupon allotment, whichever is higher), send a memo to Public Assistance Collections with a copy of the DFA 842 and the “Repayment Agreement”. Do not collect more than the $10/10%. Any amount over and above the $10/10% must be paid directly to Public Assistance Collections.
    4. If the HH chooses to repay by lump sum or installments, send the original DFA 842 and a copy of the “Repayment Agreement” to Public Assistance Collections. Delete the overissuance adjustment amount from the future month. If the client fails to pay as agreed and is currently receiving CalFresh, Public Assistance Collections will notify the EW. The EW must then send the “Food Stamp Repayment Notice For Administrative Errors Only - Final Notice”. If a revised Repayment agreement is not returned within 10 days, begin benefit reduction as per SAR/PB rules.
    5. If the “Repayment Agreement” is NOT returned by the client.
      1. For an AE, do not change the adjustment entry already made in CalSAWS. A 10-day NOA is not required, unless the reduction amount and effective date are different from what was stated by the County on the “Repayment Agreement” when it was mailed to the client.

      2. Exception: AE O/Is claims in which the noticing requirement was met in 2/00 to begin allotment reduction in 3/00 fall under the Lomeli v. Saenz court case settlement. (See below)

  12. AE OVERISSUANCE THAT WAS ESTABLISHED ON OR AFTER 3/1/00 (including claims in which the noticing requirement was met in 2/00 to begin allotment reduction in 3/00)

    1. Wait 30 days or until the repayment agreement has been returned by the client, whichever comes first.
    2. If the “Repayment Agreement” is returned by the client:
      1. If the HH chooses allotment reduction, do not change the adjustment entry already entered on the computer. A 10-day NOA is not required, unless the reduction amount and effective date are different than what was stated by the County on the overissuance NOA when it was mailed to the client.
      2. If the client wishes to repay through allotment reduction more than the amount automatically determined by the computer ($10 or 5% of the allotment reduction, whichever is higher), ensure the correct amount is indicated in the “Repayment Agreement”. Do not collect more than the $10/5% unless the recipient elects for the benefits to be reduced at a higher rate.
      3. If the HH chooses to repay by lump sum or installments, send the original DFA 842 and a copy of the “Repayment Agreement” to Public Assistance Collections. Delete the overissuance adjustment amount from the future month in CalSAWS. If the client fails to pay as agreed and is currently receiving CalFresh, Public Assistance Collections will notify the EW. The EW must then send the “Food Stamp Repayment Notice For Administrative Errors Only - Final Notice”. If a revised Repayment agreement is not returned within 10 days, begin benefit reduction.
    3. If the “Repayment Agreement” is NOT returned by the client.
      1. For an AE, do not change the adjustment entry already made in CalSAWS. A 10-day NOA is not required, unless the reduction amount and effective date are different from what was stated by the County on the “Repayment Agreement” when it was mailed to the client.

Related Topics

Forms and Filing