Rule Legal Assistance Eligibility; Maximum Income Guidelines


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Rule Legal Assistance Eligibility; Maximum Income Guidelines

  1. 1. 45545 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations EPA APPROVED REGULATIONS IN THE TEXAS SIP—Continued State ap- State citation Title/subject proval/sub- EPA approval date Explanation mittal date * * * * * * * Subchapter C—Vehicle Inspection and Maintenance; Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program; and Early Action Compact Counties Division 3: Early Action Compact Counties Section 114.80 ...... Applicability ................................... 11/17/04 8/8/05 [Insert FR page number where document begins]. Section 114.81 ...... Vehicle Emissions Inspection Re- 11/17/04 8/8/05 [Insert FR page number quirements. where document begins]. Section 114.82 ...... Control Requirements ................... 11/17/04 8/8/05 [Insert FR page number Subsection 114.82(b) is NOT part where document begins]. of the approved SIP. Section 114.83 ...... Waivers and Extensions ............... 11/17/04 8/8/05 [Insert FR page number where document begins]. Section 114.84 ...... Prohibitions ................................... 11/17/04 8/8/05 [Insert FR page number where document begins]. Section 114.85 ...... Equipment Evaluation Procedures 11/17/04 8/8/05 [Insert FR page number for Vehicle Exhaust Gas Ana- where document begins]. lyzers. Section 114.86 ...... Low Income Repair Assistance 11/17/04 8/8/05 [Insert FR page number Program (LIRAP) for Partici- where document begins]. pating Early Action Compact Counties. Section 114.87 ...... Inspection and Maintenance Fees 11/17/04 8/8/05 [Insert FR page number where document begins]. * * * * * * * Section Part 1611 (67 FR 70376).1 Futher action [FR Doc. 05–15607 Filed 8–5–05; 8:45 am] SUPPLEMENTARY INFORMATION: on the rulemaking was suspended, in 1007(a) of the Legal Services BILLING CODE 6560–50–P deference to a request by Representative Corporation Act requires LSC to James Sensenbrenner, Chairman of the establish guidelines, including setting U.S. House of Representatives Judiciary maximum income levels, for the LEGAL SERVICES CORPORATION Committee, that LSC suspend action on determination of applicants’ financial the rulemaking pending the 45 CFR Part 1611 eligibility for LSC-funded legal confirmation of new LSC Board of assistance. Part 1611 implements this Financial Eligibility Directors members appointed by provision, setting forth the requirements President Bush. Legal Services Corporation. relating to determination and AGENCY: After the confirmation of nine new Final rule. documentation of client financial ACTION: board members and the appointment of eligibility. Part 1611 also sets forth a new LSC President, the reconstituted SUMMARY: The Legal Services requirements related to client retainer Operations and Regulations Committee Corporation (‘‘LSC’’ or ‘‘Corporation’’) is agreements. resumed consideration of the Part 1611 amending its regulations relating to rulemaking in early 2004. At the financial eligibility for LSC-funded legal Procedural Background meeting of the full Board of Directors on services and client retainer agreements. April 30, 2005, the Board approved the On June 30, 2001, LSC initiated a The revisions are intended to reorganize republication of a revised NPRM for Negotiated Rulemaking and appointed a the regulation to make it easier to read public comment. That NPRM was Working Group comprised of and follow; simplify and streamline the published on May 24, 2005 (70 FR requirements of the rule to ease representatives of LSC (including the 29695). administrative burdens faced by LSC Office of Inspector General), the LSC received thirteen (13) comments recipients in implementing the National Legal Aid and Defenders on the NPRM, including nine comments regulation and to aid LSC in Association, the Center for Law and from individual LSC grant recipients, enforcement of the regulation; and to Social Policy, the American Bar one comment from a senior attorney clarify the focus of the regulation on the Association’s Standing Committee on with a recipient commenting in his financial eligibility of applicants for Legal Aid and Indigent Defendants and personal capacity, one comment from a LSC-funded legal services. a number of individual LSC recipient member of the public, and comments DATES: This final rule is effective programs. The Negotiated Rulemaking from the Center for Law and Social September 7, 2005. Working Group met three times Policy on behalf of the National Legal FOR FURTHER INFORMATION CONTACT: throughout 2002 and developed a Draft Aid and Defenders Association, and the Mattie C. Condray, Senior Assistant Notice of Proposed Rulemaking (NPRM) American Bar Association’s Standing General Counsel, Office of Legal Affairs, which was the basis for the NPRM Committee on Legal Aid and Indigent Legal Services Corporation, 3333 K. St., published by LSC on November 22, NW., Washington, DC 20007–3522; 2002 proposing significant revisions to 1 For additional discussion of the Negotiated (202) 295–1624 (phone); (202) 337–6519 Rulemaking Working Group, see 67 FR 70376 (fax); (e-mail). (November 22, 2002). VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00023 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  2. 2. 45546 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations Defendants. With minor exceptions merely a threshold question and the that this Part also sets forth financial (discussed in greater detail below), the issue of whether any otherwise eligible standards for groups seeking legal commenters strongly supported the applicant will be provided with legal assistance supported by LSC funds. proposed revisions. Upon receipt of the assistance is a matter for the recipient to Finally, LSC is adding a reference to the comments, LSC prepared a Draft Final determine with reference to its priorities retainer agreement requirement in the Rule discussing the comments and and resources. In addition, this part purpose section to provide a notice at making permanent the proposed does not address eligibility based on the beginning of the regulation that this revisions. The Draft Final Rule was citizenship or alienage status; those subject is included in Part 1611. LSC considered by the Operations and eligibility requirements are set forth in received several comments specifically Regulations Committee of the Board of supporting and no comments objecting Part 1626 of LSC’s regulations, Directors at its meeting of July 28, 2005, to these changes. LSC adopts the Restrictions on Legal Assistance to and the Final Rule was adopted by the revisions as proposed. Aliens. Finally, LSC received one Board of Directors at its meeting of July comment suggesting that because this Section 1611.2—Definitions 30, 2005. Part contains LSC’s requirements LSC is adding definitions for several pertaining to when and how recipients Revisions to Part 1611 terms and amending the definitions for must execute retainer agreements with While specific revisions are discussed each of the existing terms currently clients (a subject not directly related to in greater detail in the Section-by- defined in the regulation. LSC believes financial eligibility determinations), that Section analysis below, it should be that the new definitions and the the title of this Part should refer to noted that the revisions reflect several amended definitions will help to make retainer agreements. While the overall goals of the original Negotiated the regulation more easily requirements for retainer agreements are Rulemaking Working Group: comprehensible. included in this Part, it primarily Reorganization of the regulation to make addresses financial eligibility and LSC Section 1611.2(a)—Advice and Counsel it easier to read and follow; disagrees that retainer agreements LSC is adding a definition of the term simplification and streamlining of the should be specifically included in the ‘‘advice and counsel’’ as that term requirements of the rule to ease title of this Part. appears in proposed section 1611.9, administrative burdens faced by LSC Retainer Agreements. Under the new Section-by-Section Analysis recipients in implementing the definition, ‘‘advice and counsel’’ is regulation, facilitate compliance and aid Section 1611.1—Purpose defined as limited legal assistance that LSC in enforcement of the regulation; LSC is revising this section to make involves the review of information and clarification of the focus of the clear that the standards of this part relevant to the client’s legal problem(s) regulation on the financial eligibility of concern only the financial eligibility of and counseling the client on the applicants for LSC-funded legal services persons seeking LSC-funded legal relevant law or action(s) to take to as an issue separate from decisions on assistance and that a finding of financial address the legal problem(s). Advice whether to accept a particular client for eligibility under Part 1611 does not and counsel does not encompass service. In particular, LSC is create an entitlement to service. In drafting of documents or making third- significantly reorganizing and addition, LSC is removing the language party contacts on behalf of the client. simplifing the sections of the rule which in the current regulation referring to Thus, for example, advising a client of set forth the various requirements giving preferences to ‘‘those least able to what notice a landlord is required to relating to establishment of recipient obtain legal assistance.’’ Although the provide to a tenant before evicting the annual income and asset ceilings, original LSC Act contained language tenant would fall under ‘‘advice and authorized exceptions and indicating that recipients should counsel,’’ but making a phone call to a determinations of eligibility. These provide preferences in service to the landlord to prevent the landlord from changes are intended to clarify the poorest among applicants, that language evicting a tenant would not be regulation and include substantive was deleted when the Act was considered ‘‘advice and counsel.’’ changes to make intake simpler and less reauthorized in 1977 and has remained Several commenters specifically burdensome and render basic financial out of the legislation ever since. supported this proposed definition, and eligibility determinations easier for Moreover, section 504(a)(9) of the FY no commenters opposed the proposed recipients to make. LSC is also moving 1996 appropriations act, Public Law definition. Accordingly, LSC adopts the the existing provisions on group 104–134 (incorporated by reference in definition as proposed. representation, with some amendment, the current appropriations act and Three of the commenters who to a separate section of the regulation. implemented by regulation at 45 CFR specifically supported this proposed Finally, LSC is simplifying and Part 1620) provides that recipients are to definition did express a concern, clarifying the retainer agreement make service determinations in however, about the statement in the requirement. accordance with written priorities, preamble to the NPRM in which LSC Title of Part 1611 which take into account factors other stated that LSC anticipates that advice LSC is changing the title of Part 1611 than the relative poverty among and counsel will generally be from ‘‘Eligibility’’ to ‘‘Financial applicants. Thus, as there is no statutory characterized by a one-time or very Eligibility.’’ This change is intended, basis for a preference for those least able short term relationship between the first, to make clear that with respect to to afford assistance and because LSC attorney and the client. These individuals seeking LSC-funded legal believes that the regulation should focus commenters noted that there are any assistance, the standards of this part on financial eligibility determinations number of situations in which a deal only with the financial eligibility of without reference to issues relating to recipient attorney has to do some such persons. LSC believes this change determinations by a recipient to provide research in order to properly advise a will help clarify that a finding of services to a particular applicant, LSC client or in which the attorney provides financial eligibility under Part 1611 has determined that such language advice and counsel to a client on a does not create an entitlement to should be removed from the regulation. limited number of occasions, but over a service. Rather, financial eligibility is LSC is also adding language specifying somewhat extended period of time. VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00024 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  3. 3. 45547 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations These commenters suggested deleting the financial eligibility of persons the terms ‘‘liquid’’ and ‘‘non-liquid’’ any reference to an anticipated time seeking legal assistance supported with should be eliminated and that the period in relation to the intended LSC funds, LSC has decided to use the regulation should focus instead on the meaning of ‘‘advice and counsel.’’ term ‘‘applicant’’ throughout the ready convertibility of the asset to cash. The use of the word ‘‘generally’’ in The other key concept in the regulation to emphasize the distinction the sentence the commenters objected to definition of asset is the availability of between applicants, clients, and persons was intended to convey that LSC is the resource to the applicant. Although seeking or receiving assistance aware that there are circumstances in the current regulation notes that the supported by other than LSC funds. which a case would qualify as ‘‘advice recipient’s asset guidelines ‘‘shall take Accordingly, LSC is adding a definition and counsel’’ notwithstanding that the into account impediments to an of applicant providing that an applicant advice and counsel may be provided individual’s access to assets of the is an individual seeking legal assistance over a somewhat extended time period. family unit or household,’’ the Working supported with LSC funds. Groups, Nonetheless, it is the case that many, if Group was of the opinion that this corporations and associations are not most, advice and counsel cases principle could be more clearly specifically excluded from this involve a short-term relationship articulated. LSC believes that the definition, as the eligibility of groups is between the attorney and the client. proposed language accomplishes that addressed wholly within section 1611.6. Even if the attorney must do some Recipients currently may provide purpose. LSC received numerous comments research prior to providing advice, LSC legal assistance without regard to a specifically supporting the proposed does not expect that the need to do person’s financial eligibility under Part definition of assets. LSC, however, also research will create a relationship 1611 when the assistance is supported received one comment expressing which extends for a significant period of wholly by non-LSC funds. LSC is not concern that defining assets as resources time in most cases. Indeed, part of the changing this (in fact, this principle is ‘‘readily convertible to cash’’ could justification for exempting advice and restated in section 1611.4(a)) and preclude recipients from deeming all counsel cases from the retainer believes that the use of the term non-primary residence real estate as an agreement requirement has been the fact applicant as adopted herein will help to asset and require a more lengthy inquiry that such relationships are of generally clarify the application of the rule. LSC received no comments objecting into the property’s ready convertibility short duration, such that requiring the to these changes and adopts the to cash. LSC notes at the outset that recipient to ensure an executed retainer revisions as proposed. under the current rules, recipients are agreement is obtained may take longer already required to ‘‘take into account than the time it takes for the attorney to Section 1611.2(d)—Assets impediments’’ to access to the provide the advice and counsel to the LSC is adding a definition of the term resources. Thus, to the extent that the client. If, instead, it was the case that assets to the regulation. The new monetary value of a particular advice and counsel cases typically last definition, ‘‘cash or other resources that applicant’s real property is not available for a long time, the opportunity to are readily convertible to cash, which to an applicant, recipients should obtain retainer agreements would not be are currently and actually available to already be taking that inaccessibility lacking. Thus, LSC continues to the applicant,’’ is intended to provide into account in reviewing the anticipate that in most cases ‘‘advice some guidance to recipients as to what applicant’s resources. Nonetheless, LSC and counsel’’ will be characterized by a is meant by the term assets, yet provide believes that recipients currently have one-time or short term relationship considerable latitude to recipients in sufficient discretion to establish a between the attorney and the client, but developing a description of assets that rebuttable presumption that an recognizes that this may not always be addresses local concerns and applicant’s non-primary residence real the case. Whether a particular case conditions. The key concepts intended property is a resource readily meets the definition of ‘‘advice and in this definition are (1) ready convertible to cash and countable counsel’’ or not will continue to be convertibility to cash; and (2) toward the recipient’s asset ceiling and determined on a case-by-case basis, availability of the resource to the also to determine that a particular piece considering the facts and circumstances. applicant. of property is not readily convertible to Section 1611.2(b)—Applicable Rules of Although the term is not defined in cash and, as such, should not be Professional Responsibility the regulation, current section 1611.6(c) considered a resource available to the states that ‘‘assets considered shall LSC is adding a definition of the term applicant for the purpose of the asset include all liquid and non-liquid assets ‘‘applicable rules of professional ceiling. Nothing in the rule being * * *’’ The intent of this requirement is responsibility’’ as that term appears in adopted today disturbs that discretion. that recipients are supposed to consider proposed sections 1611.8, Change in Accordingly, LSC adopts the definition all assets upon which the applicant Financial Eligibility Status and 1611.9, as proposed. could draw in obtaining private legal Retainer Agreements. This definition is Section 1611.2(e)—Brief Services assistance. While there was no intent to intended to make clear that the change the underlying requirement, in LSC is adding a definition of the term references in the regulation refer to the discussing the issues of assets and asset ‘‘brief services’’ as it is used in section rules of ethics and professional ceilings in the Working Group it became 1611.9, Retainer Agreements. LSC notes responsibility applicable to attorneys in apparent that the terms ‘‘liquid’’ and that brief services is legal assistance the jurisdiction where the recipient ‘‘non-liquid’’ were obscuring characterized primarily by being either provides legal services or understanding of the regulation. To distinguishable from both extended maintains its records. LSC received no some, the term ‘‘non-liquid’’ implied service and advice and counsel. Under comments objecting to this definition something not readily convertible to the new definition, brief service is the and adopts the definition as proposed. cash, while to others the term implied performance of a discrete task (or tasks) Section 1611.2(c)—Applicant an asset that was simply something which are not incident to continuous Consistent with the intention to keep other than cash, without regard to the representation in a case but which the focus of the regulation on the ease of converting the asset to cash. involve more than the mere provision of standards and criteria for determining Thus, the Working Group agreed that advice and counsel. Examples of brief VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00025 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  4. 4. 45548 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations services include activities such as the LSC received one comment Section 1611.2(g)—Governmental specifically supporting the change from Program for Persons With Disabilities drafting of documents or personalized ‘‘household or family unit’’ to assistance with the completion of LSC is adding a definition of the term ‘‘household.’’ This commenter pleadings being prepared and filed by ‘‘governmental program for persons suggested that the change would pro se litigants, and making limited with disabilities.’’ LSC is including in provide ‘‘more flexibility’’ to recipients. third-party contacts on behalf of a client the authorized exceptions to the annual LSC notes that the change in the over, in most instances, a short time income ceilings an exception relating to terminology used in the regulation in period. applicants seeking to obtain or maintain this instance is not creating any govermental benefits for persons with LSC received two comments substantive change. As noted above, disabilities. Accordingly, it is specifically supporting the proposed recipients already have considerable appropriate to include a definition for definition. LSC received one comment discretion and flexibility to determine this term. The definition, ‘‘any Federal, noting that the proposed definition does the scope of an applicant’s household; State or local program that provides not address the relative simplicity or the change in terminology being benefits of any kind to persons whose brevity of documents which may be adopted with this final rule neither eligibility is determined on the basis of drafted by a recipient within the scope increases nor decreases that discretion mental and/or physical disability,’’ is of brief service. This commenter was and flexibility. LSC adopts the change intended to be similar in structure and concerned that the definition was in terminology as proposed. application to the definition of the term contrary to the Case Service Reporting Throughout the course of the ‘‘governmental program for low income (CSR) definition of ‘‘brief services.’’ This rulemaking field representatives have individuals and families.’’ LSC received commenter suggested changing the suggested deleting the words ‘‘before no comments objecting to the proposed definition or adding a statement that the taxes’’ from the definition of income. definition and adopts the definition as Five commenters reiterated this position definition in the regulation should not proposed. in comments on the NPRM, while one apply to the CSR. LSC notes that this Section 1611.2(h)—Income commenter specifically opposed definition of ‘‘brief services’’ is, while deleting ‘‘before taxes’’ from the not identical, specifically intended to be LSC is revising the current definition definition of income. Such a change is fully consistent with the definition of of income to refer to the total cash desirable, the proponents contend, ‘‘brief services’’ in the CSR. As such, receipts of a ‘‘household,’’ instead of a because automatically deducted taxes LSC disagrees that the definitions are ‘‘family unit’’ and to make clear that are not available for an applicant’s use recipients have the discretion to define inconsistent and LSC adopts the and the failure to take current taxes into the term household in any reasonable definition as proposed. account in determining income has an manner. Currently, the definition of Section 1611.2(f)—Extended Service adverse impact on the working poor. income refers to ‘‘family unit,’’ while While it is undoubtedly true that the phrase ‘‘household or family unit’’ LSC is adding a definition of the term automatically deducted taxes are not appears in the section on asset ceilings. ‘‘extended service’’ as that term is used available to an applicant, LSC agrees It appears that there is no difference in section 1611.9, Retainer Agreements. with the other commenter that the intended by the use of different terms in As defined, extended service means definition of income is not the these sections and LSC believes that it legal assistance characterized by the appropriate place in the regulation to is appropriate to simplify the regulation performance of multiple tasks incident deal with this issue. to use the same single term in each to continuous representation in which Taking the phrase ‘‘before taxes’’ out provision, without creating a the recipient undertakes responsibility of the definition of income would substantive change in the meaning of for protecting or advancing the client’s effectively change the meaning of either term. LSC has decided to use interests beyond advice and counsel or income from gross income to net income ‘‘household’’ instead of ‘‘family unit’’ brief services. Examples of extended after taxes. The term income has meant because it is a simpler, more service include representation of a gross income since the original adoption understandable term. of the financial eligibility regulation in client in litigation, administrative As noted above, LSC does not intend 1976. See 41 FR 51604, at 51606, adjudicative proceeding, alternate the use of the term ‘‘household’’ to have November 23, 1976. The maximum dispute resolution proceeding, or a different meaning from the current income guidelines are based on the extended negotiations with a third term ‘‘family unit.’’ Under current Department of Health and Human party. LSC received no comments guidance from the LSC Office of Legal Services (DHHS) Federal Poverty Affairs, recipients have considerable objecting to the proposed definition and Guidelines amounts. DHHS’’ Federal latitude in defining the term ‘‘family adopts the definition as proposed. Poverty Guidelines are, by law, based on unit.’’ Specifically, OLA External Section 1611.2(f)—Governmental the Census Bureau’s Federal Poverty Opinion No. EX–2000–1011 states: Program for Low Income Individuals or Thresholds, which are calculated using Neither the LSC Act nor the LSC Families gross income before taxes. 42 U.S.C. regulations define ‘‘family unit’’ for client 9902(2); Office of Management and eligibility purposes. The Corporation will LSC is changing the term that is used Budget Directive No. 14 (May 1978). defer to recipient determinations on this in the regulation from ‘‘governmental Changing the definition of income issue, within reason. Recipients may program for the poor’’ to ‘‘governmental effectively from gross to net after taxes consider living arrangements, familial program for low income individuals and relationships, legal responsibility, financial would introduce two different uses of families.’’ This change is not intended responsibility or family unit definitions used the term income into the regulations by government benefits agencies, amongst to create any substantive change in the (one use in the income guidelines other factors, in making such decisions. current definition, but merely reflect published annually by LSC in Appendix preferred nomenclature. LSC received LSC intends that this standard would A to Part 1611 and another use in the no comments objecting to this change also apply to definitions of ‘‘household’’ text of the regulation). This is and the definition makes this clear. problematic in two ways. and adopts the revision as proposed. VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00026 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  5. 5. 45549 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations First, with respect to the annual None of the comments supporting Indian trusts from being considered income ceiling limits, unilaterally removal of ‘‘before taxes’’ from the income for the purpose of determining changing the standard from gross to net definition of income addressed the financial eligibility of Native American income after taxes would arguably problems discussed above. Moreover, applicants for service, and that such exceed LSC’s authority. LSC is required LSC believes that the practical problem funds or interests of individual Native by the LSC Act to set its maximum (that taxes, indeed, are funds Americans in trust or restricted lands income guidelines in consultation with unavailable to the applicant), is better should not be considered as a resource the Office of Management and Budget addressed by treating taxes as a separate for the purpose of LSC financial and the Governors of the states. 42 factor which can be considered by the eligibility. See LSC Office of Legal U.S.C. 2996f(a)(2)(A). The annual recipient in making financial eligibility Affairs External Opinion 99–17, August income ceiling agreed to by LSC, OMB determinations. (This matter is 27, 1999. As noted in External Opinion 99–17, and the Governors (set at 125% of the presented in greater detail in the the exclusion applies only to funds and Federal Poverty Guidelines amounts) discussion of section 1611.5, below.) other interests held in trust by the was arrived at based on gross income; Further, although LSC does not consider federal government and investment changing to a net income after taxes defining income as gross income (rather income accrued therefrom. The standard would effectively increase the than net after taxes) as presenting any following have been found to qualify for annual ceiling amounts beyond what ‘‘apparent preference’’ for non-working the exclusion from income in was agreed. LSC is concerned that it applicants, permitting current taxes to determining eligibility for various could only undertake such an action in be a factor to be considered by the government benefits: income from the consultation with OMB and the recipient in making financial eligibility sale of timber from land held in trust; Governors, which consultation has not determinations eliminates any such income derived from farming and happened. apparent preference that may be Second, adopting a net income after ranching operations on reservation land perceived as existing. Accordingly, LSC taxes standard would, as one held in trust by the federal government; declines to remove the words ‘‘before commenter noted, increase the upper income derived from rentals, royalties, taxes’’ from the definition of income. income limit as well. This would have In addition, LSC is moving the and sales proceeds from natural the effect of further increasing the information on what is encompassed by resources of land held in trust; sales potential eligible applicant pool. the term ‘‘total cash receipts’’ into the proceeds from crops grown on land held Although LSC believes that the slight definition of income. LSC believes that in trust; and use of land held in trust for increase in the eligible applicant pool having this information in the definition grazing purposes. On the other hand, which will result from increasing the of income, rather than in a separate per capita distributions of revenues upper income limit from 187.5% to definition will make the regulation from gaming activity on tribal trust 200% of the Federal Poverty Guidelines easier to understand, particularly as the property are not protected because such amounts is justifiable (see discussion of term ‘‘total cash receipts’’ is used only funds are not held in trust by the federal section 1611.5, below), LSC is in the definition of income. In government. Thus, such distributions concerned that an additional increase in incorporating the language on ‘‘total are considered to be income for the eligible applicant pool is not cash receipts,’’ LSC is retaining the purposes of determining LSC financial necessary to effectively deal with the current definition of the term without eligibility. practical problem that taxes, indeed, any substantive amendment, but Total Cash Receipts represent funds unavailable to the reorganizing it to make it easier to LSC is deleting the definition of ‘‘total applicant. understand. Specifically, LSC is cash reciepts,’’ currently at section It was suggested in several comments separating the definition into two 1611.2(h), as a separately defined term that adopting a net income after taxes sentences, one of which sets forth those in the regulation. Rather, LSC has standard is preferable because it would things which are included in total cash reorganized the information contained be easier for recipients as they would receipts and one which sets forth those in the definition and moved it directly only have to consider ‘‘take home pay’’ things which are specifically excluded in computing income at intake. into the definition of ‘‘income.’’ As from the definition of total cash However, as one commenter noted, take noted above, the only place the term receipts. It is worth noting that the list home pay is often not simply pay net of ‘‘total cash reciepts’’ is used is in the of items included is not intended to be taxes; there are other deductions from defintion of ‘‘income’’ and LSC believes exhaustive, while the list of items to be gross pay which an applicant could that having a separate definition for excluded is intended to be exhaustive. have (e.g., 401(k) deductions, medical ‘‘total cash reciepts’’ is cumbersome and LSC received no comments objecting to savings account deductions, insurance unnecessary. LSC received no these changes and adopts the revisions premium deductions, child support, as proposed. comments objecting to this change and garnishments). In such cases, the Finally, LSC wishes to restate in this adopts the revision as proposed. recipient would not be able to simply preamble guidance on the treatment of Section 1611.3—Financial Eligibility determine that income equaled take Indian trust fund monies in making Policies home pay, but would have to identify income determinations. Several LSC is creating a new section 1611.3, and add amounts for such deductions provisions of Federal law regulate Financial Eligibility Policies, based on from gross pay back in when whether or not income or interests in requirements currently found in determining the applicant’s income. In Indian trusts are taxable or should be sections 1611.5(a), 1611.3(a)–(c) and addition, some, but not all, of such other considered as resources or income for 1611.6. The comments generally deductions from pay could qualify as federal benefits. See 25 U.S.C. 1407– supported these revisions, although LSC factors under the allowable exceptions 1408; 25 U.S.C. 117a–117c. Under the received a few comments suggesting to the annual income ceiling amounts. terms of those laws, LSC has determined some changes to what was proposed. LSC is concerned that this would add that recipients may disregard up to confusion in the income determination $2000 per year of funds received by LSC adopts the revisions as proposed, process, contrary to the intent of this individual Native Americans that are with certain amendments, as discussed rulemaking. derived from income or interests in below. VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00027 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  6. 6. 45550 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations The new section 1611.3 addresses in respect to assets of domestic violence the Working Group discussions and in victims jointly held with their abusers, comments to the November 2002 NPRM, one section recipients’ responsibilities this requirement applies when the that the list of excludable assets should for adopting and implementing financial applicant has made the recipient aware be illustrative, rather than exhaustive. eligibility policies. Under the new that he or she is a victim of domestic The commenters argue that having an section, the current requirement that violence. illustrative rather than an exhaustive list recipients’ governing bodies have to In addition, this section permits will provide recipients with greater adopt policies for determining financial recipients to adopt financial eligibility flexibility in developing asset policies eligibility is retained. However, LSC is policies which provide for authorized and note that many recipients already changing the current requirement for an exceptions to the annual income ceiling exclude certain other assets. annual review of these policies and pursuant to section 1611.5 and for Commenters alternatively suggested instead will now require recipients’ waiver of the asset ceiling for an some specific assets be added to the list, governing bodies to conduct triennial applicant in a particular case under such as household furnishings, reviews of policies. The Working Group unusual circumstances and when computers, and such assets which are agreed that an annual review was approved by the Executive Director or excluded from other governmental unnecessary and has tended to result in his/her designee. Finally, LSC will benefit programs for which the rather pro forma reviews of policies. permit recipients to adopt financial applicant is eligible. A few comments LSC believes that a triennial review eligibility policies which permit also specifically suggested that the requirement will be sufficient to ensure financial eligibility to be established by exclusion for vehicles should not be that financial eligibility policies remain reference to an applicant’s receipt of limited to vehicles needed for work. relevant and will encourage a more benefits from a governmental program One of these commenters noted that the thorough and thoughtful review when for low-income individuals or families Social Security Administration has such review is undertaken. The section consistent with section 1611.4(b). recently changed its rules on eligibility also adds an express requirement that These provisions are, with two for Supplemental Security Income (SSI) recipients adopt implementing exceptions, based directly on current to exclude from an SSI applicant’s procedures. While this is already requirements with a few substantive assets one vehicle used for implicit in the current regulation, LSC changes. First among the changes, transportation, without specific regard believes it is preferable for this recipients will no longer be required to to the particular transportation use (as requirement to be expressly stated. Such routinely submit their asset ceilings to was previously the case), provided it is implementing procedures may be LSC. This requirement appears to serve not strictly a recreational vehicle such adopted either by a recipient’s little or no purpose, as compliance with as a dune buggy. See 70 FR 6340, at governing body or by the recipient’s this requirement has been spotty and 6342–43 (February 7, 2005). management. LSC received several LSC has taken no action to obtain the LSC believes that some of the comments supporting these changes and information from recipients which have comments indicate that LSC was not no comments objecting to them. not automatically submitted it. clear in the NPRM about the Accordingly, LSC adopts the revisions Moreover, the information collected is relationship between the asset ceiling as proposed. not being put to any routine use. In adopted by a recipient and the list of Section 1611.3 also contains certain addition, LSC has not had a parallel excludable items. Under the current minimum requirements for the content requirement for the submission of regulation recipients are required to of recipient’s financial eligibility income ceilings. LSC has determined adopt asset ceilings based on the policies. Specifically, LSC is requiring that this requirement can be eliminated economy and the relative cost of living that the recipient’s financial eligibility without any adverse effect on program in the service area. Recipients are also policy must: compliance with or Corporation to take into account special needs of the • Specify that only applicants for enforcement of the regulation. LSC elderly, institutionalized and persons service determined to be financially received several comments supporting with disabilities, along with the eligible under the policy may be further this change and no comments objecting reasonable equity value in work-related considered for LSC-funded service; to it. Accordingly, LSC adopts the equipment used to provide income. • Establish annual income ceilings of revision as proposed. Implicit in the requirement is the no more than 125% of the current Another substantive change is that expectation that the recipient will set its DHHS Federal Poverty Guidelines recipients will be permitted to provide ceiling at a level as to cover the value amounts; in their financial eligibility policies for of such things as household furnishings, • Establish asset ceilings; and the exclusion of (in addition to a clothing and other personal affects of • Specify that, notwithstanding any primary residence, as provided for in applicant (and members of applicant’s other provisions of the regulation or the the existing regulation) vehicles used for households) and other such assets as recipient’s financial eligibility policies, transportation, assets used in producing applicants may reasonably be expected in assessing the financial eligibility of income (such as a farmer’s tractor or a to have without liquidating in the an individual known to be a victim of carpenter’s tools) and other assets attempt to secure legal assistance. Once domestic violence, the recipient shall excluded from attachment under State the asset ceiling has been set, the consider only the income and assets of or Federal law from the calculation of recipient is expected to consider all of the applicant and shall not consider any assets. In identifying other assets the applicant’s assets against that assets jointly held with the abuser. excluded from attachment under State ceiling, except for the value of a In establishing income and asset or Federal law, LSC has in mind assets principle residence. The exclusion of a ceilings, the recipient will have to that are excluded from bankruptcy principle residence is intended to consider the cost of living in the proceedings or other assets that may not ensure that homeowners do not exceed locality; the number of clients who can be attached for the satisfaction of a debt, the asset ceiling just on the value of the be served by the resources of recipient; etc. home. the potentially eligible population at Most of the comments received With the NPRM, LSC proposed to various ceilings; and the availability of reiterated the position that field allow recipients to exclude from the other sources of legal assistance. With representatives had expressed during asset computation a limited number of VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00028 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1
  7. 7. 45551 Federal Register / Vol. 70, No. 151 / Monday, August 8, 2005 / Rules and Regulations additional assets which would be likely assets excludable under all benefits Part 1611. Nevertheless, this provision to cause an applicant to exceed the program for low-income individuals, the of law applies regardless of whether it applicable asset ceiling without relative national consistency which LSC appears in the regulation. However, liquidation of that or other significant believes is important would be incorporating this language into the household assets. As such, LSC impeded. As noted above, LSC believes regulation is appropriate, particularly in continues to prefer to retain the that the revised language does afford light of the goal of this rulemaking to approach in the current regulation in recipients sufficient additional clarify the requirements relating to which the list of excludable assets is set flexibility in developing asset ceiling financial eligibility determinations.2 LSC received one comment asking forth in toto. LSC believes that this policies. As noted above, LSC is changing the whether this proposal means that the approach emphasizes the policy that asset ceiling waiver standard slightly. financial eligibility of an applicant who most assets are to be considered and The current regulation permits waiver is the victim of domestic violence is to maintains a basic level of consistency in ‘‘unusual or extremely meritorious be determined solely on the basis of the nationally with respect to this issue. situations;’’ the new rule permits waiver applicant’s income and assets, without LSC continues to expect that recipients in ‘‘unusual circumstances.’’ The regard to the income and assets of other will set asset ceilings and asset ceiling Working Group determined that the members of the household (beyond the waiver policies so as to permit current language is unnecessarily alleged perpetrator of the domestic applicants to have reasonable amounts stringent and that it is unclear what the violence). LSC intended that the income of assets which will not count against difference is intended to be between of the alleged perpetrator and assets them in eligibility determinations and ‘‘unusual’’ and ‘‘extremely meritorious.’’ jointly held by the applicant with the believes that the new language does It was suggested in the Working Group alleged perpetrator must be disregarded afford recipients some additional that the standard should be ‘‘where in assessing the financial eligibility of flexibility in developing asset ceilings, appropriate.’’ LSC, however, felt that the the applicant, but that income and consistent with the policy articulated regulation should continue to reflect the assets not jointly held with the alleged above particularly in light of the policy that waivers of the asset ceilings perpetrator of other members of the amendment to the asset ceiling waiver should only be granted sparingly and household (as defined by the recipient) standard discussed below. Turning to comments on the specific not as a matter of course. The Working would have to be considered in the proposed excludable assets, LSC agrees Group agreed that the revised language financial eligibility assessment. LSC that it is neither necessary nor desirable accomplishes this goal, while providing acknowledges that the language of the to restrict the exclusion for vehicles to some additional appropriate discretion statute (and LSC’s originally proposed those used for work only. There are implementation thereof) could be read to recipients. In addition, where the many situations in which a vehicle is an so as to suggest that only the applicant’s current rule requires all waiver applicant’s only reliable, accessible individual income and assets may be decisions to be made by the Executive method of transportation for vital life counted. However, LSC believes that Director, LSC proposed to permit those activities other than work, such as such a reading would require a decisions to be made by the Executive education and training activities, substantive change to the financial Director or his/her designee. LSC reaching medical appointments, grocery eligibility requirements that Congress believes it is important that a person in shopping, transporting children to did not intend. significant authority be involved in At the time of adoption of section 506, school or activities, etc. As such, it is making asset ceiling waiver decisions, the regulation permitted recipients to reasonable to consider such vehicles as but recognizes that, especially as more take into account an applicant’s ability among the significant assets that a recipients have consolidated and now to access certain assets (including assets recipient should be able to own and not serve larger areas, it is important for of alleged perpetrators of domestic have counted towards the applicant’s recipients to have the discretion to violence) and permitted recipients to applicable asset ceiling. Accordingly, delegate certain authority to regional or consider the applicant’s lack of access to LSC is amending the language in branch office managers or directors to the alleged perpetrator’s income as an proposed 1611.2(d)(1) which read increase administrative efficiency. LSC ‘‘other significant factor related to the ‘‘vehicles required for work’’ and received several comments supporting inability to afford legal assistance.’’ 45 adopting instead the language ‘‘vehicles this change and no comments objecting CFR 1611.6(d); 1611.5(b)(1)(E). required for transportation.’’ Under this to it. Accordingly, LSC adopts the However, in some cases, the victim’s formulation, the value of vehicles which revision as proposed. household income including the income are not used for transportation, such as The first totally new element is the of the alleged perpetrator was above the vehicles used purely for recreational language regarding victims of domestic upper income limit, such that the activities (e.g., dune buggies, golf carts, violence. This new language recipient was not able to even apply the go-karts, and the like) would have to be implements LSC’s FY 1998 ‘‘significant other factors’’ factor to included in determining whether an appropriations law. Specifically, section make a determination of eligibility and applicant’s assets exceed the recipient’s 506 of that act provides: in some cases there was a problem applicable asset ceiling. In establishing the income or assets of an LSC declines, however, to expand the related to the extent to which the victim individual who is a victim of domestic list to include the exclusion of any could access household assets over violence, under section 1007(a)(2) of the assets excluded under benefits programs Legal Services Corporation Act (42 U.S.C. for low income persons for which the 2 This point is demonstrated by the fact that LSC 2996f(a)(2)), to determine if the individual is received one comment specifically supporting the applicant is eligible. There are myriad eligible for legal assistance, a recipient implementation of section 506 into Part 1611 on the described in such section shall consider only benefit programs with a widely varying basis that the new language in 1611 would provide the assets and income of the individual and range of excludable assets. Some recipients with enhanced ability to provide legal shall not include any jointly held assets. programs have relatively low asset assistance to victims of domestic violence. Rather, the incorporation of this statutory mandate into the Public Law 105–119, 111 Stat. 2440 ceilings, but exclude more assets from regulation at this time does not create any the calculation, while other programs (November 26, 1997). Although this law substantive change in the authority and exclude fewer assets, but have higher has been in effect since 1997, it has responsibility recipients have had with respect to asset ceilings. If LSC were to include all never been formally incorporated into this issue since 1997. VerDate jul<14>2003 18:56 Aug 05, 2005 Jkt 205001 PO 00000 Frm 00029 Fmt 4700 Sfmt 4700 E:FRFM08AUR1.SGM 08AUR1