Vehicles

[EAS 42.215.4]

Definitions

Vehicle

The definition of a vehicle includes, but is not limited to, the following:

Cars
Trucks
Sports Utility Vehicles (SUVs)
Vans
Boats
Trailers
Campers
Recreational Vehicles (RVs)
Motorcycles
Houseboats
Jet Skis
Snowmobiles

Fair Market Value (FMV)

To determine the FMV, the EW will use the information provided on the Self-Certification Form for Motor Vehicles - CalWORKs (CW 80). The county must accept an applicant’s or recipient’s self-certification of all vehicles in the Assistance Unit (AU), as well as any encumbrances.

Encumbrances

An encumbrance on a vehicle is the "pay-off" amount. This amount includes the principal plus any interest that is currently due on the vehicle. The "pay-off" amount does NOT include ALL the interest that will become due and payable in the future. The EW MUST use the "pay-off" balance showing on a current monthly statement or contact the lender for the current pay-off amount.

The encumbrance is then subtracted from the FMV, resulting in the Equity Value.

Equity Value

The equity value of a vehicle needs to be determined only if it does not qualify for an exemption. EWs will use the information provided on CW 80 to determine the equity value of all vehicles. The total equity value is equal to the FMV less encumbrances. Refer to Charts Handbook Resource and Vehicle Limit for the current vehicle limit.

Important: The current vehicle limit must be used in calculations. The example may not reflect the current vehicle limit.

Example Example An AU self-certifies that they own a non-exempt motor vehicle with a FMV of $23,500. The AU still owes $5,450 on the vehicle (the encumbrance), resulting in a total equity value of $18,050 for this vehicle. Since the total equity value is less than $25,483 (vehicle limit effective July 1, 2021), the value is excluded from resource consideration, and the equity of the vehicle will not be counted as a resource toward the AU’s maximum resource limit. The equity (FMV - encumbrance) is less than $25,483.

Leased Vehicles

A vehicle which is leased or on a lease/purchase option is not regarded as property until a transfer of ownership has occurred. A leased vehicle remains in the ownership of the leasing firm.

ExampleExampleA client applies for CalWORKs for himself, his wife, and their 3 children. He has leased a car from Future Fords. His lease contract states that he has the option to buy the car and that all his monthly lease payments are applied toward the purchase of the car. Since Future Fords is the owner of the vehicle, the vehicle is not counted as property to the client.

Note: Encumbrances on motor vehicles must be recorded with the Department of Motor Vehicles (DMV) to be recognized as a valid encumbrance by this agency.

Chart to Determine Value of Motor Vehicles

Follow the steps below to determine the value of a motor vehicle:

Step	Action
1.	When a vehicle meets any of the following criteria, the vehicle is exempt from the equity value test:
	Criteria	Description
	AU’s home	Used as the AU’s home.
	Physically disabled AU or non-AU member	Used to transport a physically disabled AU or non-AU member, whether or not the ineligible physically disabled non-AU member’s property is included in the property limit (i.e., undocumented non-citizen, sanctioned parent, SSI/SSP parent and/or child, etc.). The disability may be temporary or permanent. Verify the disability if it is not evident.
	Produce income	Used to produce income over 50% of the time. If the vehicle was previously used over 50% of the time in self-employed farming, the exemption continues for one year from the date the self-employed farming stopped.
	Income consistent with FMV	Used to produce income consistent with its FMV, even if only on a seasonal basis. Refer to Personal Property Directly Related to the Use of Some Exempt Vehicles.
	Necessary for employment	Used for long-distance travel necessary for employment, other than daily commuting, that is essential to the employment of a family member.
	Transporting fuel or water	Used to carry fuel for heating or water for home use, when the transported fuel or water is the primary source of fuel or water for the AU.
	Prior use in self-employment farming	Due to the vehicle’s prior use in self-employed farming over 50% of the time, the vehicle is exempt for one year from the date when self-employed farming stopped.
	Gifts, donations, or family transfers.	Vehicles gifted, donated, or transferred within the family (i.e., grandma gifts her granddaughter a vehicle). Verification from the Department of Motor Vehicles (DMV) is required. See the DMV Verification sub-section below for more information.
If the vehicle is exempt, document in the case and STOP HERE. If the vehicle is NOT exempt, go to STEP 2.
2.	Determine the vehicle's Equity Value (FMV - encumbrances).
3.	Count any equity value in excess of the current vehicle limit towards the resource limit.

DMV Verification

DMV verification is required when a client states that a vehicle was obtained as a gift, donation, or family transfer. The client must be given adequate time to apply for and receive verification from the DMV. Use the following chart to determine when verification of a DMV transaction is due:

If the client has requested DMV verification, paid the fee, and...	Then the client...
Is currently waiting for the vehicle transfer verification,	Shall be given 30 days from the date of the verification request to provide the proof to the County.
It is determined that the DMV has failed to provide the transfer verification, at no fault of the client,	Shall be given an additional 30 days to submit the verification (60 days total from the date of the original request).

The EW shall accept a completed Sworn Statement (GEN 853) as verification of the value of the vehicle if the DMV verification is not received by the 60th day.

Note: The County must assist the client by paying the DMV fee if the client is unable to pay. All requests for assistance with the third-party payment (i.e., DMV fee) must be approved by the designated District Office CalWORKs liaison who, at the time of the request, shall contact the Program Bureau for further instructions.

Self-Certification Form for Motor Vehicles - CalWORKs (CW 80)

The CW 80 is a form used to self-certify, under penalty of perjury, the FMV and encumbrances of all vehicles owned by the AU, and to identify exempt vehicles. This form is required when a recipient reports a vehicle that was not previously reported at the time of initial application, the previous SAR 7, or annual redetermination.

Example Example A recipient must complete the CW 80 when the SAR 7 indicates that a vehicle has been acquired that was not previously reported.

Vehicle Information and Self-Certification of Equity Value (Appendix E) of the SAWS 2 Plus

Appendix E of the Application for CalFresh, Cash Aid, and/or Medi-Cal/Health Care Programs (SAWS 2 Plus) is used by applicants to self-certify the equity values of all vehicles owned by the AU, and to identify exempt vehicles.

Discrepant or Unreasonable Self-Certifications

As with all CalWORKs eligibility determinations, if the County has reason to believe the information provided by the client may be questionable or incorrect, and that this potential discrepancy would affect the AU’s eligibility for assistance, the EW must take steps to resolve potential discrepancies with the client.

ExampleExample A client states on the CW 80 that she has a late model vehicle valued at $2,000, but does not provide any information on the CW 80 to explain the very low value. Since new cars have a value that significantly exceeds $2,000, it is reasonable for the EW to question the accuracy of the estimated FMV. The EW must contact the client to inquire whether the client may have made a mistake.

The following is an example of a possible mistake a client may make:

ExampleExample The client could have written $2,000 instead of $22,000; it could be a salvage car; she could have confused equity value with FMV, etc. The EW would permit the client to correct the CW 80 and would re-evaluate the AU’s eligibility. If the client is unable to explain the low value and does not submit a corrected CW 80, the EW will deny/discontinue the case for exceeding the property limit.

Re-Evaluation

A vehicle must be evaluated at application. Any additional vehicle that an AU acquires while on CalWORKs must be evaluated at the time of acquisition. However, once a vehicle has been evaluated, it does NOT need to be re-evaluated until the next annual RD.

Kelley Blue Book (KBB) Value

If the client requests assistance in determining the FMV of a vehicle, the EW will utilize the online KBB website. Information regarding the vehicle’s year, make, model, and number of doors is required.

When using the online KBB, follow these steps:

Go to www.kbb.com.
Select “My Car's Value”.
Enter the
- Year
- Make
- Model
- Vehicle mileage (12,000 x age of car) ExampleExample An 8 year old car would have a mileage value of 96,000. It is calculated by 12,000 x age of car (8) = 96,000.
- The client’s zip code or office zip if the client is homeless, then click on “Go”.
Select “Style”, then click on “Next”.
Select “Price with Standard Equipment”, color of the vehicle, and “Trading in My Car”, then click on “Next”.
Select “Get Your Trade-In & Private Party Values”, then click on “Next”.
On the Select the Vehicle Condition page, select “Fair” as the condition, unless the client indicates otherwise, then click on “Next”.
The “Trade-In Value” is displayed and will be used as the FMV of the vehicle.
Print a copy of the “Trade-In Value” page and have it imaged to the case.

Salvage Title

The DMV defines a salvage vehicle as “a vehicle which has been wrecked, destroyed, or damaged to the extent that the insurance company considers it uneconomical to make repairs to the vehicle and the vehicle is not repaired by or for the person who owned the vehicle when the damage occurred.” The vehicle’s title will contain a notation identifying the vehicle as a salvage vehicle. A vehicle with a salvage title must be valued in the same manner as all other vehicles. If the client disagrees with the value determined, they must be given the opportunity to acquire verification of the true value from a reliable source.

Motor Vehicle Examples

Important: The current values must be used in calculations. The examples may not reflect the current values.

Example #1Example #1

The applicant or recipient owns a non-exempt vehicle with an equity value that exceeds $25,483. The AU self-certifies on the CW 80 that the FMV is $35,000, and they owe $5,000. After subtracting the amount owed on the vehicle from the FMV, the EW determines that the equity value of the motor vehicle is $30,000. In this case, the equity value of the vehicle exceeds the $25,483 limit by $4,517. The $4,517 is counted toward the AU’s maximum resource limit. If the AU’s total assets, including the $4,517, fall below the $10,211 (or $15,317 for families with aged/disabled household members) maximum resource limit, the AU is resource-eligible.

Computation of equity counted toward the vehicle resource limit:

$35,000   FMV of the motor vehicle
- $5,000   Less Encumbrances
$30,000   Total Equity Value
- $25,483   Less $25,483

=$ 4,517 Amount Counted Toward Resource Limit

Example #2Example #2

A client who received a vehicle from her father provided the county with verification from the DMV that the vehicle was a gift. Regardless of the value of this motor vehicle, because it was given to her as a gift, the vehicle is completely exempt from consideration as a resource. Even if the FMV of the motor vehicle is well over $25,483, the county may not inquire into or determine the value, or count the value of the motor vehicle toward the AU’s $10,888/$16,333 resource limit. The county wouldn’t need to perform a calculation; however, the client will need to obtain verification from the DMV that the vehicle is a gift/donation or family transfer.