Good cause.

Good cause. When a State agency with otherwise effective administration exceeds the tolerance level for payment errors as described in this section, the State agency may seek relief from liability claims that would otherwise be levied under this section on the basis that the State agency had good cause for not achieving the payment error rate tolerance. State agencies desiring such relief must file an appeal with the Department's Administrative Law Judge (ALJ) in accordance with the procedures established under part 283 of this chapter. Paragraphs (f)(1) through (f)(5) of this section describe the unusual events that are considered to have a potential for disrupting program operations and increasing error rates to an extent that relief from a resulting liability amount or increased liability amount is appropriate. The occurrence of an event(s) does not automatically result in a determination of good cause for an error rate in excess of the national performance measure. The State agency must demonstrate that the event had an adverse and uncontrollable impact on program operations during the relevant period, and the event caused an uncontrollable increase in the error rate. Good cause relief will only be considered for that portion of the error rate/liability amount attributable to the unusual event. The following are unusual events which State agencies may use as a basis for requesting good cause relief and specific information that must be submitted to justify such requests for relief:
(1) Natural disasters and civil disorders. Natural disasters such as those under the authority of The Disaster Relief and Emergency Assistance Amendments of 1988 (Pub. L. 100-707), which amended The Robert T. Stafford Disaster Relief and Emergency Assistance Act (Pub. L. 93-288), or civil disorders that adversely affect program operations.
(i) When submitting a request for good cause relief based on this example, the State agency shall provide the following information:
(A) The nature of the disaster(s) (e.g., a tornado, hurricane, earthquake, flood, etc.) or civil disorder(s) and evidence that the President has declared a disaster;
(B) The date(s) of the occurrence;
(C) The date(s) after the occurrence when program operations were affected;
(D) The geographic extent of the occurrence (i.e., the county or counties where the disaster occurred);
(E) The proportion of the Supplemental Nutrition Assistance Program caseload whose management was affected;
(F) The reason(s) why the State agency was unable to control the effects of the disaster on program administration and errors.
(G) The identification and explanation of the uncontrollable nature of errors caused by the event (types of errors, geographic location of the errors, time period during which the errors occurred, etc.).
(H) The percentage of the payment error rate that resulted from the occurrence and how this figure was derived; and
(I) The degree to which the payment error rate exceeded the national performance measure in the subject fiscal year.
(ii) (A) The following criteria and methodology will be used to assess and evaluate good cause in conjunction with the appeals process, and to determine that portion of the error rate/liability amount attributable to the uncontrollable effects of a disaster or civil disorder:
(1) Geographical impact of the disaster;
(2) State efforts to control impact on program operations;
(3) The proportion of Supplemental Nutrition Assistance Program caseload affected; and/or
(4) The duration of the disaster and its impact on program operations.
(B) Adjustments for these factors may result in a waiver of all, part, or none of the liability amount for the applicable period. As appropriate, the waiver amount will be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeds the national performance measure. For example, a reduction in the waiver amount may be made when a State agency's recent error rate history indicates that even absent the events described the State agency would have exceeded the national performance measure in the review period.
(iii) If a State agency has provided insufficient information to determine a waiver amount for the uncontrollable effects of a natural disaster or civil disorder using factual analysis, the waiver amount shall be evaluated using the following formula and methodology which measures both the duration and intensity of the event. Duration will be measured by the number of months the event had an adverse impact on program operations. Intensity will be a proportional measurement of the issuances for the counties affected to the State's total issuance. This ratio will be determined using issuance figures for the first full month immediately preceding the disaster. This figure will not include issuances made to households participating under disaster certification authorized by FNS and already excluded from the error rate calculations under § 275.12(g)(2)(vi). The counties considered affected will include counties where the disaster/civil disorder occurred, and any other county that the State agency can demonstrate had program operations adversely impacted due to the event (such as a county that diverted significant numbers of Supplemental Nutrition Assistance Program certification or administrative staff). The amount of the waiver of liability will be determined using the linear equation W = Ia/Ib × [M/12 or Mp/18] × L, where Ia is the issuance for the first full month immediately preceding the unusual event for the county affected; Ib is the State's total issuance for the first full month immediately preceding the unusual event; M/12 is the number of months in the subject fiscal year that the unusual event had an adverse impact on program operations; Mp/18 is the number of months in the last half (April through September) of the prior fiscal year that the unusual event had an adverse impact on program operations; L is the total amount of the liability for the fiscal year. Mathematically this formula could result in a waiver of more than 100 percent of the liability amount; however, no more than 100 percent of a State's liability amount will be waived for any one fiscal year. Under this approach, unless the State agency can demonstrate a direct uncontrollable impact on the error rate, the effects of disasters or civil disorders that ended prior to the second half of the prior fiscal year will not be considered.
(2) Strikes. Strikes by State agency staff necessary to determine Supplemental Nutrition Assistance Program eligibility and process case changes.
(i) When submitting a request for good cause relief based on this example, the State agency shall provide the following information:
(A) Which workers (i.e., eligibility workers, clerks, data input staff, etc.) and how many (number and percentage of total staff) were on strike or refused to cross picket lines;
(B) The date(s) and nature of the strike (i.e., the issues surrounding the strike);
(C) The date(s) after the occurrence when program operations were affected;
(D) The geographic extent of the strike (i.e., the county or counties where the strike occurred);
(E) The proportion of the Supplemental Nutrition Assistance Program caseload whose management was affected;
(F) The reason(s) why the State agency was unable to control the effects of the strike on program administration and errors;
(G) Identification and explanation of the uncontrollable nature of errors caused by the event (types of errors, geographic location of the errors, time period during which the errors occurred, etc.);
(H) The percentage of the payment error rate that resulted from the strike and how this figure was derived; and
(I) The degree to which the payment error rate exceeded the national performance measure in the subject fiscal year.
(ii) (A) The following criteria shall be used to assess, evaluate and respond to claims by the State agency for a good cause waiver of a liability amount in conjunction with the appeals process, and to determine that portion of the error rate/liability amount attributable to the uncontrollable effects of the strike:
(1) Geographical impact of the strike;
(2) State efforts to control impact on program operations;
(3) The proportion of Supplemental Nutrition Assistance Program caseload affected; and/or
(4) The duration of the strike and its impact on program operations.
(B) Adjustments for these factors may result in a waiver of all, part, or none of the liability amount for the applicable period. For example, the amount of the waiver might be reduced for a strike that was limited to a small area of the State. As appropriate, the waiver amount will be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeded the national performance measure.
(iii) If a State agency has provided insufficient information to determine a waiver amount for the uncontrollable effects of a strike using factual analysis, a waiver amount shall be evaluated by using the formula described in paragraph (f)(1) of this section. Under this approach, unless the State agency can demonstrate a direct uncontrollable impact on the error rate, the effects of strikes that ended prior to the second half of the prior fiscal year will not be considered.
(3) Caseload growth. A significant growth in Supplemental Nutrition Assistance Program caseload in a State prior to or during a fiscal year, such as a 15 percent growth in caseload. Caseload growth which historically increases during certain periods of the year will not be considered unusual or beyond the State agency's control.
(i) When submitting a request for good cause relief based on this example, the State agency shall provide the following information:
(A) The amount of growth (both actual and percentage);
(B) The time the growth occurred (what month(s)/year);
(C) The date(s) after the occurrence when program operations were affected;
(D) The geographic extent of the caseload growth (i.e. Statewide or in which particular counties);
(E) The impact of caseload growth;
(F) The reason(s) why the State agency was unable to control the effects of caseload growth on program administration and errors;
(G) The percentage of the payment error rate that resulted from the caseload growth and how this figure was derived; and
(H) The degree to which the error rate exceeded the national performance measure in the subject fiscal year.
(ii) (A) The following criteria and methodology shall be used to assess and evaluate good cause in conjunction with the appeals process, and to determine that portion of the error rate/liability amount attributable to the uncontrollable effects of unusual caseload growth:
(1) Geographical impact of the caseload growth;
(2) State efforts to control impact on program operations;
(3) The proportion of Supplemental Nutrition Assistance Program caseload affected; and/or
(4) The duration of the caseload growth and its impact on program operations.
(B) Adjustments for these factors may result in a waiver of all, part, or none of the liability amount for the applicable period. As appropriate, the waiver amount will be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeded the national performance measure. For example, a reduction in the waiver amount may be made when a State agency's recent error rate history indicates that even absent the events described the State agency would have exceeded the national performance measure in the review period. Under this approach, unless the State agency can demonstrate a direct uncontrollable impact on the error rate, the effects of caseload growth that ended prior to the second half of the prior fiscal year will not be considered.
(iii) If the State agency has provided insufficient information to determine a waiver amount for the uncontrollable effects of caseload growth using factual analysis, the waiver amount shall be evaluated using the following five-step calculation:
(A) Step 1 - determine the average number of households certified to participate Statewide in the Supplemental Nutrition Assistance Program for the base period consisting of twelve consecutive months ending with March of the prior fiscal year;
(B) Step 2 - determine the percentage of increase in caseload growth from the base period (Step 1) using the average number of households certified to participate Statewide in the Supplemental Nutrition Assistance Program for any twelve consecutive months in the period beginning with April of the prior fiscal year and ending with June of the current year;
(C) Step 3 - determine the percentage the error rate for the subject fiscal year, as calculated under paragraph (b)(2) of this section, exceeds the national performance measure determined in accordance with paragraph (d)(1) of this section;
(D) Step 4 - divide the percentage of caseload growth increase arrived at in step 2 by the percentage the error rate for the subject fiscal year exceeds the national performance measure as determined in step 3; and
(E) Step 5 - multiply the quotient arrived at in step 4 by the liability amount for the current fiscal year to determine the amount of waiver of liability.
(iv) Under this methodology, caseload growth of less than 15% and/or occurring in the last three months of the subject fiscal year will not be considered. Mathematically this formula could result in a waiver of more than 100 percent of the liability amount; however, no more than 100 percent of a State's liability amount will be waived for any one fiscal year.
(4) Program changes. A change in the Supplemental Nutrition Assistance Program or other Federal or State program that has a substantial adverse impact on the management of the Supplemental Nutrition Assistance Program of a State. Requests for relief from errors caused by the uncontrollable effects of unusual program changes other than those variances already excluded by § 275.12(d)(2)(vii) will be considered to the extent the program change is not common to all States.
(i) When submitting a request for good cause relief based on unusual changes in the Supplemental Nutrition Assistance Program or other Federal or State programs, the State agency shall provide the following information:
(A) The type of changes(s) that occurred;
(B) When the change(s) occurred;
(C) The nature of the adverse effect of the changes on program operations and the State agency's efforts to mitigate these effects;
(D) Reason(s) the State agency was unable to adequately handle the change(s);
(E) Identification and explanation of the uncontrollable errors caused by the changes (types of errors, geographic location of the errors, time period during which the errors occurred, etc.);
(F) The percentage of the payment error rate that resulted from the adverse impact of the change(s) and how this figure was derived; and
(G) The degree to which the payment error rate exceeded the national performance measure in the subject fiscal year.
(ii) (A) The following criteria will be used to assess and evaluate good cause in conjunction with the appeals process and to determine that portion of the error rate/liability amount attributable to the uncontrollable effects of unusual changes in the Supplemental Nutrition Assistance Program or other Federal and State programs:
(1) State efforts to control impact on program operations;
(2) The proportion of Supplemental Nutrition Assistance Program caseload affected; and/or
(3) The duration of the unusual changes in the Supplemental Nutrition Assistance Program or other Federal and State programs and the impact on program operations.
(B) Adjustments for these factors may result in a waiver of all, part, or none of the liability amount for the applicable period. As appropriate, the waiver amount will be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeded the national performance measure.
(5) Significant circumstances beyond the control of a State agency. Requests for relief from errors caused by the uncontrollable effect of a significant circumstance other than those specifically set forth in paragraphs (f)(1) through (f)(4) of this section will be considered to the extent that the circumstance is not common to all States, such as a fire in a certification office.
(i) The State agency shall provide the following information when submitting a request for good cause relief based on significant circumstances, the State agency shall provide the following information:
(A) The significant circumstances that the State agency believes uncontrollably and adversely affected the payment error rate for the fiscal year in question;
(B) Why the State agency had no control over the significant circumstances;
(C) How the significant circumstances had an uncontrollable and adverse impact on the State agency's error rate;
(D) Where the significant circumstances existed (i.e. Statewide or in particular counties);
(E) When the significant circumstances existed (provide specific dates whenever possible);
(F) The proportion of the Supplemental Nutrition Assistance Program caseload whose management was affected;
(G) Identification and explanation of the uncontrollable errors caused by the event (types of errors, geographic location of the errors, time period during which the errors occurred, etc.);
(H) The percentage of the payment error rate that was caused by the significant circumstances and how this figure was derived; and
(I) The degree to which the payment error rate exceeded the national performance measure in the subject fiscal year.
(ii) (A) The following criteria shall be used to assess and evaluate good cause in conjunction with the appeals process, and to determine that portion of the error rate/liability amount attributable to the uncontrollable effects of a significant circumstance beyond the control of the State agency, other than those set forth in paragraph (f)(5) of this section:
(1) Geographical impact of the significant circumstances;
(2) State efforts to control impact on program operations;
(3) The proportion of Supplemental Nutrition Assistance Program caseload affected; and/or
(4) The duration of the significant circumstances and the impact on program operations.
(B) Adjustments for these factors may result in a waiver of all, part, or none of the liability amount for the applicable period. As appropriate, the waiver amount will be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeded the national performance measure.
(6) Adjustments. When good cause is found under the criteria in paragraphs (f)(1) through (f)(5) of this section, the waiver amount may be adjusted to reflect States' otherwise effective administration of the program based upon the degree to which the error rate exceeds the national performance measure.
(7) Evidence. When submitting a request to the ALJ for good cause relief, the State agency shall include such data and documentation as is necessary to support and verify the information submitted in accordance with the requirements of paragraph (f) of this section so as to fully explain how a particular significant circumstance(s) uncontrollably affected its payment error rate.
(8) Finality. The initial decision of the ALJ concerning good cause shall constitute the final determination for purposes of judicial review as established under the provisions of § 283.17 and § 283.20 of this chapter.
(g) Results of appeals on liability amount determinations.
(1) If a State agency wholly prevails on appeal and, consequently, its liability amount is reduced to $0 through the appeal, and if the State agency began new investment activities prior to the appeal determination, FNS shall pay to the State agency an amount equal to 50 percent of the new investment amount that was expended by the State agency.
(2) If FNS wholly prevails on a State agency's appeal, FNS will require the State agency to invest all or a portion of the amount designated for new investment to be invested or to be paid to the Federal government.
(3) If neither the State agency nor FNS wholly prevails on a State agency's appeal, FNS shall apply the original waiver, new investment, and at-risk percentage determinations to the liability amount established through the appeal. If the State agency began new investment prior to the appeal decision and has already expended more than the amount produced for new investment as a result of the appeal decision, the Department will match the amount of funds expended in excess of the amount now required by the Department for new investment.

Source

7 CFR § 275.23


Scoping language

None
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