Supplemental Nutrition Assistance Program: Quality Control Error Tolerance Threshold, 67315-67317 [2011-28230]

Agencies

• DEPARTMENT OF AGRICULTURE
• Food and Nutrition Service

[Federal Register Volume 76, Number 211 (Tuesday, November 1, 2011)]
[Rules and Regulations]
[Pages 67315-67317]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-28230]



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Federal Register / Vol. 76, No. 211 / Tuesday, November 1, 2011 / 
Rules and Regulations

[[Page 67315]]



DEPARTMENT OF AGRICULTURE

Food and Nutrition Service

7 CFR Part 275

[FNS-2011-0060]
RIN 0584-AE24


Supplemental Nutrition Assistance Program: Quality Control Error 
Tolerance Threshold

AGENCY: Food and Nutrition Service, USDA.

ACTION: Direct final rule.

-----------------------------------------------------------------------

SUMMARY: This direct final rule is amending the Quality Control (QC) 
review error threshold in our regulations from $25.00 to $50.00. The 
purpose for raising the QC error threshold is to make permanent the 
temporary threshold change that was required by the American Recovery 
and Reinvestment Act of 2008. This change does not have an impact on 
the public. The QC system measures the accuracy of the eligibility 
system for the Supplemental Nutrition Assistance Program (SNAP).

DATES: This rule will become effective on January 3, 2012 unless the 
Department receives written significant adverse comments on or before 
December 1, 2011. If significant adverse comments that are relevant 
within the scope of the rulemaking are received within the specified 
comment period, the Department will publish timely notification of 
withdrawal of this rule in the Federal Register. This rule shall apply 
to all FY 2012 QC reviews.

ADDRESSES: The Food and Nutrition Service (FNS) invites interested 
persons to submit comments on this direct final rule. Comments may be 
submitted by any of the following methods:
     Federal eRulemaking Portal: Go to https://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Fax: Submit comments by facsimile transmission to: (703) 
605-0795.
     Mail: Send comments to Francis Heil, Branch Chief, Quality 
Control Branch, SNAP, FNS, 3101 Park Center Drive, 822, 
Alexandria, VA 22302, (703) 305-2442.
     E-mail: Send comments to SNAPHQ-Web@fns.usda.gov. Include 
Docket ID Number FNS-2011-0060, Supplemental Nutrition Assistance 
Program: Quality Control Error Tolerance Threshold Direct Rule, in the 
subject line of the message.
     Hand Delivery or Courier: Deliver comments to Francis 
Heil, Branch Chief, Quality Control Branch, SNAP, FNS, 3101 Park Center 
Drive, Alexandria, VA 22302, Room 822.

All comments submitted in response to this direct final rule will be 
included in the record and will be made available to the public. Please 
be advised that the substance of the comments and the identity of the 
individuals or entities submitting the comments will be subject to 
public disclosure. FNS will make the comments publicly available on the 
Internet via https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Francis Heil, FNS, 3101 Park Center 
Drive, 822, Alexandria, VA 22302, (703) 305-2442.

SUPPLEMENTARY INFORMATION:

I. Background

    The current regulations at Sec.  275.12(f)(2) state, ``If the 
reviewer determines that food stamp allotments were either overissued 
or underissued to eligible households in the sample month, in an amount 
exceeding $25.00, the occurrence and the amount of the error shall be 
coded and reported.'' In practice, when conducting both State and 
Federal QC reviews any overissuances or underissuances found in the 
amount of $25.00 or less are not included as an error in the 
calculation of that fiscal year's (FY) error rates. This $25.00 or less 
error is also known as the error tolerance threshold (the threshold). 
This $25.00 threshold, however, does not excuse any State from their 
responsibility for following procedures found at Sec.  275.16(c) 
regarding corrective action for all errors found in QC cases.
    On February 17, 2009, the President signed Public Law 111-5, the 
American Recovery and Reinvestment Act of 2009 (ARRA). Title I, Section 
101(b)(5) of Public Law 111-5, indicated the Agriculture Secretary 
shall, ``set the tolerance level for excluding small errors for the 
purposes of section 16(c) of the Food and Nutrition Act of 2008 (7 
U.S.C. 2025(c)) at $50.00 through September 30, 2009.'' This temporary 
threshold increase was tied to the increase in the benefit amount also 
provided by ARRA. In short, this meant there was a temporary threshold 
increase from $25.00 to $50.00 for QC errors from April 2009 through 
September 2009. According to FNS's calculations, we estimate that the 
ARRA's provision excluding any errors between $25.00 and $50.00 from 
the calculation decreased the 2009 combined Payment Error Rate (PER) by 
15 percent. The total combined Payment Error Rate (PER) decreased from 
FY 2008's 5.01 percent to 4.36 percent.
    The ARRA provision concerning the QC threshold expired September 
30, 2009. The threshold for the FY 2010 QC review period reverted to 
$25.00. The increased benefit allotment, however, remains in place. The 
Department believes that the State agencies should continue to benefit 
from the increased threshold amount of $50.00 to offset the increased 
benefit amounts. Therefore, in this rulemaking, the Department is 
raising the QC tolerance threshold of $25.00 to $50.00 to make the 
temporary ARRA change permanent.
    Prior experience with the provisions of this rule under the ARRA 
demonstrates that they contribute to a significant reduction in the 
rate of improper payments in SNAP. SNAP is identified by the Office of 
Management and Budget (OMB) as a high risk program for improper 
payments. Reducing the payment error rate is a priority for both USDA 
and OMB. To improve business efficiency, agencies must prioritize those 
areas that have the most potential to improve payment accuracy and 
reduce improper payments. This rulemaking supports that goal by 
focusing on errors that are the most economically efficient to correct. 
The provisions of this rule will improve the data available at the 
Federal level allowing for further analysis of the root causes of 
payment errors. The Department's payment accuracy team will be better 
able to focus on the largest and most

[[Page 67316]]

problematic errors and then work with States on additional cost 
efficient ways to improve the Administration's goals to reduce improper 
payments.
    The Department is also requiring all error amounts found shall be 
coded and reported by the State Agencies on FNS 380-1, OMB 0584-0299, 
Review Schedule for SNAP QC Reviews, or as directed by FNS. Currently, 
State Agencies do not have to code and report QC errors for cases with 
overissuances or underissuances of $25.00 or below since they are not 
counted as QC errors when FNS calculates the National QC Error Rates at 
the end of each review year. However, during the temporary ARRA change 
from $25.00 to $50.00, States were required to code and report all 
errors between $25.00 and $50.00, which became valuable in conducting 
State corrective action as well as determining the impact of the 
threshold on the State and National QC error rates. The Department has 
determined that it would be valuable to know this information for all 
variances under $50.00, even though such variances are not included in 
the PER calculation. The information will be used to assist in 
corrective action. Therefore, the Department is making a change to 
current coding and reporting procedures for the FNS 380-1 to require 
the coding and reporting of any variances that directly contribute to 
the error determination, even those below the $50.00 threshold. This 
coding and reporting requirement will not affect the method of 
calculation for the underissuance error rate, overissuance error rate, 
and the combined PER, since the calculation will continue to exclude 
all errors equal to or below the proposed threshold change of $50.00.
    State Agencies will continue to be responsible for taking 
corrective action for all errors found in QC cases, in accordance with 
the provisions of Sec.  275.16(c).

II. Procedural Matters

Issuance of a Direct Final Rule and Date of Effectiveness

    FNS has determined that this rule is appropriate for direct final 
rulemaking because we believe this amendment to be noncontroversial and 
we anticipate no significant adverse comments. We believe this rule to 
be noncontroversial as the State agencies which administer SNAP have 
already expressed their unequivocal support for the policy implemented 
by this rule. The amendment contained in this rule was previously in 
effect under the ARRA for a six month period in fiscal year 2009. As 
such, the State agencies have significant experience with the 
operational implications of this amendment. We anticipate no 
significant adverse comments to be submitted as public comments to this 
rule as FNS did not, in the past, receive adverse comments as a result 
of the previous amendment to the threshold when it was raised from 
$5.00 to $25.00. In addition, State agencies have repeatedly expressed 
desire for the ARRA QC provisions to be reinstated on a permanent basis 
both individually and through their representative association, the 
American Public Human Services Association (APHSA). This direct final 
rulemaking is consistent with the State agencies' requests.
    This rule is effective January 3, 2012 unless the Department 
receives written significant adverse comments on or before December 1, 
2011. FNS invites public comment on this direct final rule. If 
significant adverse comments within the scope of the rulemaking are 
received, the Department will publish timely notification of withdrawal 
of this rule in the Federal Register. A significant adverse comment is 
defined as one where the comment explains why the rule would be 
inappropriate, including challenges to the rule's underlying premise or 
approach, or would be ineffective or unacceptable without a change.
    Although the rule is not effective until January 3, 2012, State 
agencies are required to apply the raised threshold for the entire FY 
2012 QC review period.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility.
    This rule has been designated not significant under section 3(f) of 
Executive Order 12866.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires Agencies 
to analyze the impact of rulemaking on small entities and consider 
alternatives that would minimize any significant impacts on a 
substantial number of small entities. Pursuant to that review, Audrey 
Rowe, FNS Administrator, has certified that this rule would not have a 
significant impact on a substantial number of small entities.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
Department generally must prepare a written statement, including a cost 
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures by State, local or tribal 
governments, in the aggregate, or the private sector, of $100 million 
or more in any one year. When such a statement is needed for a rule, 
Section 205 of the UMRA generally requires the Department to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the most cost effective or least burdensome alternative that achieves 
the objectives of the rule.
    This rule does not contain Federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local and tribal 
governments or the private sector of $100 million or more in any one 
year. Thus, the rule is not subject to the requirements of sections 202 
and 205 of the UMRA.

Executive Order 12372

    The Supplemental Nutrition Assistance Program (SNAP) is listed in 
the Catalog of Federal Domestic Assistance Programs under 10.561. For 
the reasons set forth in the final rule in 7 CFR part 3015, subpart V, 
and related Notice (48 FR 29115, June 24, 1983), this program is 
included in the scope of Executive Order 12372 which requires 
intergovernmental consultation with State and local officials.

Executive Order 13175

    USDA will undertake, within 6 months after this rule becomes 
effective, a series of Tribal consultation sessions to gain input by 
elected Tribal officials or their designees concerning the impact of 
this rule on Tribal governments, communities and individuals. These 
sessions will establish a baseline of consultation for future actions, 
should any be necessary, regarding this rule. Reports from these 
sessions for consultation will be made part of the USDA annual 
reporting on Tribal Consultation and Collaboration. USDA will respond 
in a timely and meaningful manner to all Tribal government requests for 
consultation concerning this rule and will provide additional venues, 
such as webinars and

[[Page 67317]]

teleconferences, to periodically host collaborative conversations with 
Tribal leaders and their representatives concerning ways to improve 
this rule in Indian country.
    The policies contained in this rule would not have Tribal 
implications that preempt Tribal law since State welfare agencies will 
be the most affected to the extent that they administer the SNAP.

Federalism Summary Impact Statement

    Executive Order 13132 requires Federal agencies to consider the 
impact of their regulatory actions on State and local governments. 
Where such actions have federalism implications, agencies are directed 
to provide a statement for inclusion in the preamble to the regulations 
describing the agency's considerations in terms of the three categories 
called for under Section (6)(b)(2)(B) of Executive Order 13121. FNS has 
considered this rule's impact on State and local agencies and has 
determined that it does not have Federalism implications under E.O. 
13132.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have preemptive effect 
with respect to any State or local laws, regulations or policies which 
conflict with its provisions or which would otherwise impede its full 
and timely implementation. State agencies are required to apply the 
raised threshold in this rule to all cases reviewed as part of the FY 
2012. Prior to any judicial challenge to the provisions of the final 
rule, all applicable administrative procedures must be exhausted.

Civil Rights Impact Analysis

    FNS has reviewed this rule in accordance with the Department 
Regulation 4300-4, ``Civil Rights Impact Analysis,'' to identify and 
address any major civil rights impacts the rule might have on 
minorities, women, and persons with disabilities. After a careful 
review of the rule's intent and provisions, FNS has determined that 
this rule will not in any way limit or reduce the ability of protected 
classes of individuals to participate in SNAP. This regulation does not 
apply to the certification determinations made on the intended 
beneficiaries of the SNAP. Quality Control procedures are designed to 
evaluate the accuracy of the application of SNAP certification policy 
and therefore, the evaluation procedures do not impact protected 
classes or individuals.

Paperwork Reduction Act

    Information collections associated with this rule have been 
approved under following OMB control numbers: 0584-0074, Worksheet for 
SNAP Quality Control Reviews (expiration date April 30, 2013), and 
0584-0299 Form FNS-380-1, Quality Control Review Schedule, Form FNS-
380-1 (March 31, 2013).

E-Government Act Compliance

    FNS is committed to complying with the E-Government Act, 2002, to 
promote the use of the Internet and other information technologies to 
provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

List of Subjects in 7 CFR Part 275

    Administrative practice and procedure, Supplemental Nutrition 
Assistance Program, Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, 7 CFR part 275 is 
amended as follows:

PART 275--PERFORMANCE REPORTING SYSTEM

0
1. The authority citation for part 275 continues to read as follows:

    Authority:  7 U.S.C. 2011-2036.


0
2. In Sec.  275.12, paragraph (f)(2) is revised to read as follows:


Sec.  275.12  Review of active cases.

* * * * *
    (f) * * *
    (2) Basis of issuance of errors. If the reviewer determines that 
SNAP allotments were either overissued or underissued to eligible 
households in the sample month, the State agency shall code and report 
any variances that directly contributed to the error determination that 
were discovered and verified during the course of the review. Only 
variances that exceed $50.00 (the threshold) shall be included in the 
calculation of the underissuance error rate, overissuance error rate, 
and payment error. If the State agency has chosen to report information 
on all variances in elements of eligibility and basis of issuance, the 
reviewer shall code and report any other such variances that were 
discovered and verified during the course of the review.
* * * * *

    Dated: October 25, 2011.
Jeffrey J. Tribiano,
Acting Administrator, Food and Nutrition Service.
[FR Doc. 2011-28230 Filed 10-31-11; 8:45 am]
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