Diversion Payment

[EAS 81-215.33]

The EW and the client must agree on the amount of the Diversion payment or services (to meet the needs of the goal for self-sufficiency) based on a reasonable amount for the need item (the need item must be verified). The EW will make the payment.

Payments up to $1,000 require no EW Supervisory or SSPM approval. (Hand issued warrants require Supervisory approval documented on the Journal Detail page.
Payments of $1,000 or over require EW Supervisory approval.

Payments are sent directly to the client.

Method of Payment

Diversion payments are computer-generated by the EW and sent directly to the client. This is not a hand-issued warrant, unless it is determined that a hand-issued warrant will be necessary.

Example Example The client may have a verified deadline for a payment. Perhaps the determination is made that the client is perfect for “XYZ Training”. The program begins tomorrow and the fees are due then. If it is determined that this is the Diversion plan for the client, a hand-issued payment may be made for the fees.

In the future, other methods of payments will be explored, such as vendor payments, vouchers and possibly bartering.

Choice of Diversion Recoupment

When the client must reapply for CalWORKs during the Diversion period, they must choose to either:

COUNT THE DIVERSION PERIOD MONTHS TOWARD THE CalWORKs 60-MONTH TIME LIMIT FOR EACH ADULT IN THE CASE, OR
REPAY THE ENTIRE AMOUNT OF THE DIVERSION PAYMENT PREVIOUSLY RECEIVED AND COUNT NO MONTHS TOWARD THE CalWORKs 60-MONTH LIMIT.

Once the client chooses a method of recoupment (either in months or paying cash back) they cannot change their decision. The decision must be documented on the “Diversion Recoupment Choice” (SCD 1342) and the NOA NA 1239 sent to the recipient, if recoupment of the payment is chosen.

Reminder: Diversion payments are not counted towards the Federal cumulative 60-month time on aid limit; however, one month is counted towards the CalWORKs cumulative 60-month time on aid limit.

Recoupment

The following applies when adjusting the recoupment:

The Diversion payment is adjusted from future grants at a rate of 10% of the AU’s “Maximum Aid Payment” (MAP).
When an overpayment is already being collected, continue to collect that overpayment until it is fully adjusted. When fully adjusted, begin collecting the Diversion recoupment.
Only Diversion payments issued under CalWORKs may be recouped. Diversion payments issued by other states under TANF may not be collected.
If the recipient is discontinued before the Diversion payment is recouped, any remainder is referred to Collections. See below.
When the repayment is completed, the EW must:
Send the “Diversion Recoupment” (NOA NA 1239) to the client indicating the repayment has been paid in full, and
Count no months from the Diversion period against TOA. Refer to Time on Aid (TOA) below.

Example Example On 9/2/06, Anna S. applied for CalWORKs and chose to receive a Diversion payment of $1,800 for herself and two children. The Diversion period was determined to be 3 months ($1,800 divided by $584 MAP equals 3.08 months). In October, unexpected circumstances arose which necessitated Anna to reapply for CalWORKs on 10/20/06. She chooses to repay the Diversion payment. The entire $1,800 must be collected. The $1,800 amount is to be collected beginning 11/1/06 at 10% ($58 per month).

Collections

When the case closes prior to full collection of the Diversion recoupment:

Refer the Diversion claim to Collections via the Benefit Recovery subsystem.
The “Diversion Recoupment” (NOA NA 1239) must be sent indicating to the client the balance still owed.

Time on Aid (TOA)

In order to properly record the TOA for a Diversion Payment, the EW must complete the form “TOA Review Referral” (SCD 146) and request the designated staff to record the Diversion Payment.

Fraudulent Diversion Overpayments

When it is discovered that a Diversion payment was made and is potentially fraudulent, not an agency error, recoupment must be made. Use the regular overpayment referral/collection methods.