Expansion of the Rental Subsidy Policy for Supplemental Security Income (SSI) Applicants and Recipients, 57910-57915 [2023-18213]
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Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Proposed Rules
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BILLING CODE 4910–13–P
SOCIAL SECURITY ADMINISTRATION
20 CFR Part 416
[Docket No. SSA–2023–0010]
RIN 0960–AI82
Expansion of the Rental Subsidy
Policy for Supplemental Security
Income (SSI) Applicants and
Recipients
Social Security Administration.
Notice of proposed rulemaking.
AGENCY:
ACTION:
We propose to revise our
regulations by applying nationwide the
In-Kind Support and Maintenance (ISM)
rental subsidy exception that is
currently in place for SSI applicants and
recipients residing in seven States. The
exception recognizes that a ‘‘business
arrangement’’ exists when the amount of
required monthly rent for a property
equals or exceeds the presumed
maximum value. This proposed rule
would improve nationwide program
uniformity, and, we expect, improve
equality in the application of the rental
subsidy policy.
DATES: To ensure that your comments
are considered, we must receive them
no later than October 23, 2023.
ADDRESSES: You may submit comments
by any one of three methods—internet,
fax, or mail. Do not submit the same
comments multiple times or by more
than one method. Regardless of which
method you choose, please state that
your comments refer to Docket No.
SSA–2023–0010 so that we may
associate your comments with the
correct regulation.
Caution: You should be careful to
include in your comments only
information that you wish to make
publicly available. We strongly urge you
not to include in your comments any
personal information, such as Social
Security numbers or medical
information.
1. Internet: We strongly recommend
that you submit your comments via the
internet. Please visit the Federal
eRulemaking portal at https://
www.regulations.gov. Use the ‘‘search’’
function to find docket number SSA–
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SUMMARY:
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2023–0010. The system will issue a
tracking number to confirm your
submission. You will not be able to
view your comment immediately
because we must post each comment
manually. It may take up to one week
for your comment to be viewable.
2. Fax: Fax comments to 1–833–410–
1631.
3. Mail: Mail your comments to the
Office of Legislation and Congressional
Affairs, Regulations and Reports
Clearance Staff, Mail Stop 3253
Altmeyer, 6401 Security Blvd.,
Baltimore, MD 21235.
Comments are available for public
viewing on the Federal eRulemaking
portal at https://www.regulations.gov or
in person, during regular business
hours, by arranging with the contact
person identified below.
FOR FURTHER INFORMATION CONTACT:
Tamara Levingston, Office of Income
Security Programs, 6401 Security Blvd.,
Robert M. Ball Building, Suite 2512B,
Woodlawn, MD 21235, 410–966–7384.
For information on eligibility or filing
for benefits, call our national toll-free
number, 1–800–772–1213 or TTY 1–
800–325–0778, or visit our internet site,
Social Security Online, at https://
www.ssa.gov.
SUPPLEMENTARY INFORMATION:
Background
We administer the SSI program,
which provides monthly payments to:
(1) adults and children with a disability
or blindness; and (2) adults aged 65 or
older. Eligible individuals must meet all
the requirements in the Social Security
Act (Act), including having resources
and income below specified amounts.1
Since SSI is a needs-based program for
persons with limited income and
resources, we must consider the amount
of income an applicant or recipient has
when determining whether that person
is eligible to receive SSI payments. If the
individual is eligible, their income is
also a factor in calculating the amount
of their monthly SSI payments.
Specifically, once an individual is
determined eligible for SSI, their
monthly payment amount is determined
by subtracting their countable monthly
income from the Federal benefit rate
(FBR),2 which is the monthly maximum
Federal SSI payment.3 The FBR for 2023
1 See 42 U.S.C. 1382 and 20 CFR 416.202 for a
list of the eligibility requirements. See also 20 CFR
416.420 for general information on how we
compute the amount of the monthly payment by
reducing the benefit rate by the amount of
countable income as calculated under the rules in
subpart K of 20 part 416.
2 See 20 CFR 416.1101.
3 See 20 CFR 416.405 through 416.415. Some
States supplement the FBR amount.
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is $914 for an individual and $1,371 for
an eligible individual with an eligible
spouse.4 Generally, the more income an
individual has, the less their SSI
payment will be.5 For the purposes of
SSI, ‘‘income’’ is defined as anything
that an individual receives in cash or in
kind that the individual can use to meet
their needs for food and shelter.6 The
Act and our regulations 7 define income
as ‘‘earned,’’ such as wages from work,
and ‘‘unearned,’’ such as gifted cash.8
Our proposed regulatory change
pertains to rental subsidy, which is a
type of ISM under the broader umbrella
of unearned income.
ISM
As noted above, income that affects an
individual’s monthly SSI payment can
also be provided in kind.9 Generally, we
value in-kind items at their current
market value and apply the various
exclusions for both earned and
unearned income; however, we have
special rules for valuing food or shelter
that is received as unearned income
(ISM).10 Under our current regulations,
ISM means any food or shelter that is
given to an individual or that the
individual receives because someone
else pays for it.11 Shelter includes room,
rent, mortgage payments, real property
taxes, heating fuel, gas, electricity,
water, sewerage, and garbage collection
services.12 For example, if an SSI
recipient’s brother lets the recipient live
rent-free in his home throughout a
calendar month, we would consider the
shelter the brother provides as ISM to
the recipient. We have two rules for
valuing the ISM that we must count: (1)
currently, the one-third reduction rule
(VTR) applies if the individual is living
in the household of a person,
throughout a month, who provides the
individual with both food and shelter,
and (2) the presumed maximum value
rule (PMV) applies in all other
situations in which the individual is
4 87 FR 64296, 64298 (2022) A table of the
monthly maximum Federal SSI payment amounts
for an eligible individual, and for an eligible
individual with an eligible spouse, is available at
https://www.ssa.gov/oact/cola/SSIamts.html. When
the FBR is adjusted for the cost of living, the
amount of the potential ISM reduction adjusts
accordingly.
5 See 20 CFR 416.1100.
6 See 20 CFR 416.1102.
7 See 42 U.S.C. 1382a; and 20 CFR 416.1102–
1124.
8 See 20 CFR 416.1104.
9 See 20 CFR 416.1102.
10 See 20 CFR 416.1130(a).
11 See 20 CFR 416.1130(b). We recently published
a proposed rule to remove food from the calculation
of ISM. See 88 FR 9779 Omitting Food From InKind Support and Maintenance Calculations,
published February 15, 2023.
12 See 20 CFR 416.1130(b).
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receiving countable ISM.13 For example,
a recipient lives with a sibling. The
recipient receives SNAP to pay for their
own food, but does not pay shelter
expenses. The sibling pays all the
shelter expenses. Based on the recipient
paying for their own food, SSI is
calculated under the PMV rule. The
VTR cannot apply, because the recipient
is not receiving both food and shelter
from the household.
The VTR rule is governed by
legislation and requires SSA to reduce
the applicable federal benefit rate by
one-third when the recipient receives
both food and shelter, throughout a
month, from the household in which
they reside.14 The PMV rule, which is
one-third the federal benefit rate plus
$20, only applies if the recipient
receives food or shelter from within the
household. In addition, the PMV rule
allows recipients to rebut the maximum
amount of ISM being charged, by
providing the actual value of the ISM
being received. Rebuttal is not an option
under the VTR rule.
Rental Subsidy
Our current regulation further
clarifies that an individual is not
receiving ISM in the form of room or
rent if they are paying the required
monthly rent charged under a ‘‘business
arrangement.’’ 15 Under the current
general definition, a ‘‘business
arrangement’’ exists when the amount of
monthly rent required to be paid equals
the current monthly rental value
(CMRV)—that is, the price of the rent on
the open market in the individual’s
locality.16 For example, if the owner of
an apartment would rent that property
to any potential tenant for $800 per
month, then the CMRV is $800.
Consequently, in this example, if an SSI
recipient agrees to pay the landlord rent
in the amount of $800 per month, a
‘‘business arrangement’’ would exist
and the SSI recipient would not be
receiving ISM in the form of room or
rent. Conversely, under our current
general definition of a ‘‘business
arrangement,’’ if the SSI recipient rented
the same property but paid only $400
per month, a ‘‘business arrangement’’
would not exist because $400 is less
than the CMRV.17
When we develop possible rental
subsidy, we first determine whether the
required monthly rent is equal to the
CMRV. In practice, our technicians must
contact the landlord for information on
the required monthly rent or reach out
to an appropriate source for information
about the CMRV for that property and
locality. This source can be the landlord
or another knowledgeable source (e.g., a
real estate firm or rental management
agency). With this information in hand,
we then compare the rent the individual
is paying to the CMRV and document
the reason for any reduced monthly
rent. If the required monthly rent is less
than the CMRV, we count the difference
between the required monthly rent and
the CMRV as ISM to the SSI applicant
or recipient.18 We use the presumed
maximum value (PMV) rule to value
this type of ISM. In valuing shelter
under the PMV rule, instead of
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determining the actual dollar value of
the shelter, we presume that the shelter
is worth one-third of the FBR plus the
amount of the $20 general income
exclusion.19 SSI applicants and
recipients may rebut this presumption
by showing that the value of the ISM
they are receiving is less than the
PMV.20 Thus, under this current general
policy, the amount of ISM counted is
capped at the PMV. Conversely, if the
rent equals or exceeds the CMRV, we
determine that there is no rental
subsidy.
Take the example of an SSI recipient
living with their ineligible spouse and
child who is renting a single-family
home owned by the recipient’s mother.
The mother-landlord alleges the
property has a CMRV of $1,500 per
month, but she is requiring the SSI
household to pay only $350 in rent per
month. To calculate the rental subsidy
under the current general policy, we
would subtract the required monthly
rent from the CMRV ($1,500 ¥ $350 =
$1,150), in which case the rental
subsidy would be $1,150. We would
divide the total rental subsidy by the
number of people in the household
($1,150/3 = $383.33).21 Per regulation,
the maximum amount of ISM that can
be charged is $324.66 a month for 2023.
Therefore, the recipient’s SSI payment
is $589.34 ($914 (FBR 2023)—$324.66
(PMV for 2023)). This is with the
understanding that the recipient has no
other income.22
The following chart illustrates the
above example:
EXAMPLE 1— CURRENT GENERAL RENTAL SUBSIDY POLICY
Equation
Application of the example
CMRV¥Required Monthly Rent = Household ISM .................................
Household ISM/Number of people in household = ISM/Rental Subsidy
to the SSI Recipient.
ISM is capped at the PMV .......................................................................
SSI payment = FBR¥PMV ......................................................................
Exception
Following court cases that challenged
how we applied ISM rules for rental
subsidy, we provided an exception for
residents living in jurisdictions covered
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13 20
CFR 416.1130(c).
Security Act § 1612(a)(2)(A).
15 20 CFR 416.1130(b).
16 Id. See also 20 CFR 416.1101.
17 In this instance, we would apply ISM’s PMV
rule, as the individual is receiving some level of
support from the landlord by paying less than the
CMRV of the shelter.
18 See Program Operations Manual System
(POMS) SI 00835.380E.
19 See 20 CFR 416.1140(a).
14 Social
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$1,500 ¥ $350 = $1,150.
$1,150/3 people in household = $383.33.
$383.33 > $324.66.
SSI payment = $914 ¥ $324.66 = $589.34.
by the Court of Appeals for the Seventh
Circuit (in our regulations),23 residents
in the Second Circuit (in an
Acquiescence Ruling),24 and residents
of Texas (in the Program Operations
Manual System).25 For residents of these
20 See
20 CFR 416.1140(a)(2).
method for calculating the rental subsidy
is described in POMS SI 00835.380(E)(1) Procedure
for valuing the actual value (AV) of the rental
subsidy. This methodology reflects our ISM
regulatory policy’s approach of examining rental
subsidy from the perspective of the household (see
e.g., 20 CFR 416.1130).
22 See 20 CFR 416.1140(a).
23 See 20 CFR 416.1130(b); Jackson v. Schweiker,
683 F.2d 1076 (7th Cir. 1982).
21 The
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seven excepted States (Connecticut,
New York, Vermont, Illinois, Indiana,
Wisconsin, and Texas), a ‘‘business
arrangement’’ exists when the required
monthly rent the SSI recipient is
required to pay equals or exceeds the
24 See Acquiescence Ruling (AR) 90–2(2): Ruppert
v. Bowen, 871 F.2d 1172 (2d Cir. 1989)—Evaluation
of a Rental Subsidy as In-Kind Income for
Supplemental Security Income (SSI) Benefit
Calculation Purposes—Title XVI of the Social
Security Act. If we finalize this proposed rule, we
will rescind AR 90–2(2) as obsolete, in accordance
with 20 CFR 416.1485(e)(4).
25 See Diaz v. Chater, No. 3:95–cv–01817–X (N.D.
Tex. Apr. 17, 1996); POMS SIDAL 00835.380.
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PMV.26 In these States, if the required
amount of rent is less than the PMV,
then the value of the rental subsidy is
the difference between the required
monthly rent and the PMV or the
CMRV, whichever is less. This means
there may be a lower threshold for what
qualifies as a ‘‘business arrangement’’
for applicants and recipients in these
excepted States because, in many cases,
the PMV is lower than the CMRV.
Application of this exception tends to
reduce the amount of ISM counted
towards an individual’s SSI payment,
which generally results in a higher SSI
payment amount. For example, an SSI
recipient whose living arrangement is
identical to that discussed in the prior
example, but who resides in one of the
seven States in which the exception
applies, would not be charged ISM
because the required monthly rent
exceeds the PMV ($350 > $324.66).
Consequently, the SSI recipient would
continue to receive the FBR (provided
they did not receive any other income
countable for SSI purposes).
EXAMPLE 2—RENTAL SUBSIDY EXCEPTION POLICY PROPOSED TO BE EXTENDED
PMV < CMRV ...........................................................................................
Required Monthly Rent > PMV ................................................................
Therefore, no ISM to the SSI Recipient ...................................................
As illustrated by these examples, our
current application of the ISM rules is
not uniform nationwide, and the
exception is an advantage only for those
SSI applicants and recipients living in
the seven excepted States.
Rationale for Regulatory Action
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We propose to change the rental
subsidy policy in our regulations by
applying nationally the definition of
‘‘business arrangement’’ that currently
applies in only seven States because of
the court decisions noted above. The
rationale of the courts that resulted in
the situation currently in place in seven
states, in particular in the Seventh
Circuit decision in Jackson and the
Second Circuit decision in Ruppert, also
supports extending this policy to the
other states, as outlined in our proposed
rule. In Jackson, the Seventh Circuit
reasoned that it is not enough for a
claimant to be provided shelter at a rate
below market value for that difference to
be counted as ‘‘income’’ for SSI
purposes; rather, to be counted as
‘‘income,’’ the difference between the
market value and the actual rental
payment must result in increased
purchasing power to meet the claimant’s
basic needs.27 The Seventh Circuit
explained that ‘‘purchasing power
grows if in-kind contributions of shelter
either make cash available to purchase
necessities of life other than shelter or
if, and to the extent, the quality of
shelter itself is enhanced to meet basic
needs.’’ 28 Similarly, in Ruppert, the
Second Circuit found that the difference
between the CMRV and the required
monthly rent does not always constitute
26 See
POMS SI 00835.380.B.7.
683 F.2d at 1082–87; In Jackson, the
Seventh Circuit addressed a situation where ‘‘a very
large percentage’’ of an individual’s income was
already committed to shelter costs before the agency
considered any unearned income from a rental
subsidy. Under those circumstances, the additional
value of the rental subsidy did not increase the
individual’s ability to pay for their other basic
needs. See also Supplemental Security Income for
27 Jackson,
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$324.66 < $1,500.
$350 > $324.66.
= SSI Payment = $914.
an actual economic benefit which
should be counted as ‘‘income’’ for SSI
purposes.29 To implement Ruppert, for
residents of the Second Circuit, we
announced that an applicant or
recipient does not receive an ‘‘actual
economic benefit’’ from a rental subsidy
when the amount of required monthly
rent equals or exceeds the PMV.30
Applying nationally the definition of
‘‘business arrangement’’ based on the
PMV rather than the CMRV, and thus
focusing on the SSI recipient’s
purchasing power or the actual
economic benefit they receive, would
also ensure that all SSI applicants and
recipients, regardless of where they
reside, would have the same policy
applied to them regarding the definition
of a business arrangement. This uniform
definition of business arrangement
means that no recipient’s SSI payment
amount would be lower simply because
they reside in a State where the
exception policy described above does
not currently apply. This proposed
policy change therefore supports our
goal of enhancing equality in the
programs we administer for all
applicants and recipients.
This proposal will also foster
efficiency in our administration of the
SSI program, because we no longer
would have to apply different policies
on the definition of a business
arrangement depending on the SSI
applicant or recipient’s State of
residence. In any program as large as
ours, ‘‘the need for efficiency is selfevident.’’ 31 As well, we expect that the
proposal would improve customer
service by reducing the amount of time
we need to calculate SSI payment
amounts in States in which the current
exception does not apply. Because the
exception is currently in place in some
States, we already have a wellestablished procedure for applying the
exception, and we are confident that
such a change can be applied
nationwide with minimal operational or
systems impact.
We are also proposing this rule in
response to specific requests from the
public. Recently, we adopted the Social
Security Administration’s Agency
Strategic Plan for Fiscal Years 2022–
2026 (Strategic Plan),32 which defines
our long-term goals and objectives over
the next four years to further our overall
mission. Among the stated goals, we
resolve to optimize the experience of
our customers by adopting policies
aimed at serving individuals and
communities. Our Strategic Plan further
commits to engage the public and
external stakeholders to better inform
our regulatory activities.33
In support of these goals, we have
been in communication since October
2022 with advocate groups representing
a wide variety of claimants and
beneficiaries from diverse backgrounds.
In response, we received numerous
suggestions for ways to improve access
to our programs, particularly to our SSI
program. Among the recommendations
we received were suggestions to update
and streamline the SSI program’s rules
on ISM.
As discussed above, the current lack
of uniformity in our business
arrangement definition can
disadvantage affected SSI applicants
the Aged, Blind, and Disabled; Subpart K—Income,
51 FR 13487, 13488 (Apr. 21, 1986).
28 Jackson, 683 F.2d at 1084.
29 Ruppert, 871 F.2d at 1179–81; Social Security
Acquiescence Ruling (AR) 90–2(2), 55 FR 28947,
28949 (July 16, 1990).
30 AR 90–2(2), 55 FR at 28949.
31 See Barnhart v. Thomas, 540 U.S. 20, 29
(2003); Heckler v. Campbell, 461 U.S. 458, 461, n.2
(1983).
32 Social Security Administration, Agency
Strategic Plan: Fiscal Years 2022–2026, page 9,
Strategic Goal 1: Optimize the Experience of SSA
Customers and Strategic Objective 1.1—Identify and
Address Barriers to Accessing Services. available at:
https://www.ssa.gov/agency/asp/.
33 Id.
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and recipients who do not live in States
where the rental subsidy exception
applies. The differing application of the
business arrangement definition was
noted by the external parties, who
recommended that we apply the current
rental subsidy exception nationwide as
one way to streamline the SSI program
and make it more equitable. We agree
with this recommendation. The
proposed rules, if finalized, would
benefit SSI applicants and recipients, no
matter the State they live in, and make
the SSI program easier to administer.
The proposed change would also make
the SSI program more equitable by
applying the rental subsidy policy
uniformly to all affected SSI applicants
and recipients, regardless of where they
live.
Moreover, as explained in the study
Simplifying the Supplemental Security
Income Program: Options for
Eliminating the Counting of In-kind
Support and Maintenance, ‘‘[a]lthough
SSI eligibility was intended to be
determined on the basis of objective
information on income and resources,
development of ISM is often based on
estimates of food and shelter expenses
provided by the applicant or recipient
and verified by other household
members.’’ 34 By applying the rental
subsidy exception nationwide, the rent
paid by the SSI applicant or recipient
will be compared to a standard dollar
amount—the PMV. Our technicians
anticipate sending out fewer living
arrangement development forms (form
SSA–L5061, OMB 0960–0454) by
instead confirming the limited
necessary information with the landlord
orally, namely: that the required rent
amount is equal to or greater than the
PMV.35 The more detailed estimates
currently provided by the landlord or
other household members under our
34 See Balkus, Richard; Sears, James; Wilschke,
Susan; and Wixon, Bernard. Simplifying the
Supplemental Security Income Program: Options
for Eliminating the Counting of In-kind Support and
Maintenance. Social Security Bulletin, vol. 68, no.
4, 2008, www.ssa.gov/policy/docs/ssb/v68n4/
v68n4p15.html.
35 Claimants may provide certain types of
evidence (e.g., a rental agreement or lease) to
support their allegation of rent amount, and in these
circumstances an SSA technician does not need to
reach out to the landlord to further develop the
allegation. However, SSA finds that in many
circumstances claimants do not provide SSA with
the necessary evidence. In these cases, SSA will
attempt to contact the landlord by phone to orally
confirm the rent amount. If the landlord is not
successfully reached, SSA may still be required to
send the form SSA–L5061. SSA seeks comment on
additional procedural considerations and/or
acceptable forms of evidence (e.g., proof of
electronic transfer of funds in the alleged amount
to the named landlord) that a claimant might
provide that would be minimally burdensome
while satisfactorily demonstrating proof of rent
amount.
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existing regulations are therefore less
likely to be needed or used in
administering the SSI program. This
reduced need to contact landlords or
other third parties for information
regarding the CMRV also increases the
efficiency of the SSI program by
reducing the number of instances in
which we have to seek out that
information (We note that we would
need to contact someone other than the
landlord only if we cannot verify
information with the landlord directly.).
In summary, then, this new policy will
result in greater efficiency and time
savings for our employees, and a
reduction in the reporting burden for
the public (see Paperwork Reduction
Act section of the preamble).
Proposed Change
As discussed above, we propose to
apply nationwide the rental subsidy
exception currently in place in seven
States. Accordingly, our nationwide
policy would be that a ‘‘business
arrangement’’ exists when the amount of
monthly rent required to be paid equals
or exceeds the PMV. If the required
amount of rent is less than the PMV, we
would impute as ISM the difference
between the required amount of rent
and either the PMV or the CMRV,
whichever is less. For example, if the
required household rent is $300, and the
CMRV amount is greater than the PMV,
then the amount of household ISM
would be $24.66 divided by the number
of household members. However, this
charge may be offset by other
exclusions.
Rulemaking Analyses and Notices
We will consider all comments we
receive on or before the close of
business on the comment closing date
indicated above. The comments will be
available for examination in the
rulemaking docket for these rules at the
above address. We will file comments
received after the comment closing date
in the docket and may consider those
comments to the extent practicable.
However, we will not respond
specifically to untimely comments. We
may publish a final rule at any time
after close of the comment period.
Clarity of This Rule
Executive Order 12866, as
supplemented by Executive Order
13563 and Executive Order 14094,
requires each agency to write all rules
in plain language. In addition to your
substantive comments on this proposed
rule, we invite your comments on how
to make the rule easier to understand.
For example:
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• Would more, but shorter, sections
be better?
• Are the requirements in the rule
clearly stated?
• Have we organized the material to
suit your needs?
• Could we improve clarity by adding
tables, lists, or diagrams?
• What else could we do to make the
rule easier to understand?
• Does the rule contain technical
language or jargon that is not clear?
• Would a different format make the
rule easier to understand, e.g., grouping
and order of sections, use of headings,
paragraphing?
When will we start to use this rule?
We will not use this rule until we
evaluate public comments and publish
a final rule in the Federal Register. All
final rules include an effective date. We
will continue to use our current rules
until that date. If we publish a final rule,
we will include a summary of those
relevant comments we received along
with responses and an explanation of
how we will apply the new rule.
Regulatory Procedures
Executive Order 12866, as
Supplemented by Executive Order
13563 and Executive Order 14094
We consulted with the Office of
Management and Budget (OMB) and
determined that this rule meets the
criteria for a significant regulatory
action under Executive Order 12866, as
supplemented by Executive Order
13563 and Executive Order 14094.
Therefore, OMB reviewed it.
Anticipated Transfers to Our Program
Our Office of the Chief Actuary
estimates that implementation of this
proposed rule would result in a total
increase in Federal SSI payments of
$971 million over fiscal years 2024
through 2033, assuming implementation
of this rule on April 29, 2024. These
transfers reflect an estimation that
approximately 41,000 individuals who
would be eligible under our current
rules will have their Federal SSI
payment increased by an average of
$128 per month attributable to
implementation of this rule. There
would also be an additional 14,000
individuals who are not eligible under
current rules who would be newly
eligible and would apply for benefits
under the proposed rule.
Anticipated Net Administrative Cost
Savings to the Social Security
Administration
The Office of Budget, Finance, and
Management estimates that this
proposal will result in net
E:\FR\FM\24AUP1.SGM
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57914
Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Proposed Rules
administrative savings of $10 million for
the 10-year period from FY 2024 to FY
2033. The net administrative savings is
mainly a result of unit time savings as
field office employees will not have to
spend time developing CMRV for all
rental subsidy calculations during
initial claims, pre-effectuations reviews,
redeterminations, and post-eligibility
actions. The savings are offset by costs
to update our systems, costs to send
notices to inform current recipients of
the policy changes, costs to address
inquiries from the notices, and costs
because of more individuals’ being
eligible for SSI benefits, which increases
claims, reconsiderations, appeals,
redeterminations, and post-eligibility
actions.
payment amount, or both, which would
have both quantitative effects
financially and, qualitatively, may
alleviate stress for applicants and
recipients associated with the length of
time it may take to obtain SSI.
• Administratively easier to apply the
same policy nationwide.
Anticipated Time-Savings and
Qualitative Benefits to the Public
We anticipate the following
qualitative benefits generated from this
proposed policy:
• Saving time and effort for claimants
and third parties who may have
evidence related to a claimant’s
application because they would need to
submit less information. SSA estimates
at a minimum this will result in more
than 7,000 hours of time saved in
annual reduced paperwork burden,
representing an opportunity cost of
$1,140,526 (see the Paperwork
Reduction Act section of the preamble
below for specifics).
• Potentially get faster determinations
or decisions regarding SSI eligibility or
We analyzed this proposed rule in
accordance with the principles and
criteria established by Executive Order
13132 and determined that the proposed
rule will not have sufficient Federalism
implications to warrant the preparation
of a Federalism assessment. We also
determined that this proposed rule will
not preempt any State law or State
regulation or affect the States’ abilities
to discharge traditional State
governmental functions.
Anticipated Qualitative Costs
We do not anticipate more than de
minimis costs associated with this
rulemaking. We do not anticipate that
this proposal would affect labor market
participation in any significant way, in
part because of the limited
understanding of the current policy in
the beneficiary community.
Executive Order 13132 (Federalism)
Regulatory Flexibility Act
We certify that this proposed rule will
not have a significant economic impact
on a substantial number of small entities
because it affects individuals only.
Therefore, a regulatory flexibility
Number of
respondents
OMB No.; form No.; CFR citations
0960–0174
0960–0174
0960–0454
0960–0454
Current
average
burden per
response
(minutes)
Frequency
of
response
analysis is not required under the
Regulatory Flexibility Act, as amended.
Paperwork Reduction Act
This rule does not anticipate any new
collections or require revisions to
existing collections. However, the
application of the revisions to these
rules may cause a burden change to our
currently approved information
collections under the following
information collection requests: 0960–
0174, the SSA–8006, Statement of
Living Arrangements, In-Kind Support
and Maintenance; and 0960–0454, the
SSA–L5061, Letter to Landlord
Requesting Rental Information. Based
on our current management information
data from the seven states currently
implementing these changes, we
anticipate these changes will allow for
verbal responses from landlords in place
of the current form in some situations,
thus reducing the overall burden as SSA
will not require those respondents to
complete the entirety of Form SSA–
L51061. In addition, we note that for
those who use the paper form, we will
send a revised version with question #5
removed. We also anticipate a slight
burden reduction to Form SSA–8006, as
the respondents may not need to
provide as much detail pertaining to
their rental subsidy agreement due to
the proposed rule.
The following chart shows the time
burden information associated with the
proposed rule:
Anticipated
new
burden per
response
under
regulation
(minutes)
Current
estimated
total burden
(hours)
Anticipated
estimated
total burden
under
regulation
(hours)
Estimated
burden
savings
(hours)
SSA–8006 (Paper Form) .......................................
SSA–8006 (SSI Claims System) ...........................
SSA–L5061 (Paper Form) .....................................
SSA–L5061 (Phone Call) .......................................
12,160
109,436
35,640
35,640
1
1
1
1
7
7
10
10
1,419
12,768
5,940
5,940
6
6
8
3
1,216
10,944
4,752
1,782
203
1,824
1,188
4,158
Totals .................................................................................
192,876
....................
....................
26,067
....................
18,694
7,373
The following chart shows the
theoretical cost burdens associated with
the proposed rule:
Number of
respondents
lotter on DSK11XQN23PROD with PROPOSALS1
OMB No.; form No.; CFR citations
0960–0174
0960–0174
0960–0454
0960–0454
SSA–8006 (Paper Form) ..................................
SSA–8006 (SSI Claims System) ......................
SSA–L5061 (Paper Form) ................................
SSA–L5061 (Phone Call) .................................
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15:52 Aug 23, 2023
Jkt 259001
PO 00000
Frm 00013
Anticipated
estimated total
burden under
regulation from
chart above
(hours)
12,160
109,436
35,640
35,640
Fmt 4702
Sfmt 4702
1,216
10,944
4,752
1,782
Average
theoretical
hourly cost
amount
(dollars) *
* $12.81
* 12.81
* 29.76
* 29.76
E:\FR\FM\24AUP1.SGM
24AUP1
Average
combined wait
time in field
office and/or
teleservice
centers
(minutes) **
** 19
** 24
** 24
........................
Total annual
opportunity
cost
(dollars) ***
*** $77,885
*** 443,931
*** 565,678
*** 53,032
Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Proposed Rules
Number of
respondents
OMB No.; form No.; CFR citations
Totals ............................................................................
Average
theoretical
hourly cost
amount
(dollars) *
Average
combined wait
time in field
office and/or
teleservice
centers
(minutes) **
........................
........................
Anticipated
estimated total
burden under
regulation from
chart above
(hours)
192,876
19,882
57915
Total annual
opportunity
cost
(dollars) ***
*** 1,140,526
lotter on DSK11XQN23PROD with PROPOSALS1
* We based this figure on the average DI payments based on SSA’s current FY 2023 data (https://www.ssa.gov/legislation/2023factsheet.pdf);
on the average U.S. citizen’s hourly salary, as reported by Bureau of Labor Statistics data (https://www.bls.gov/oes/current/oes_nat.htm).
** We based this figure on the average FY 2023 wait times for field offices and hearings office, as well as by averaging both the average FY
2023 wait times for field offices and teleservice centers, based on SSA’s current management information data.
*** This figure does not represent actual costs that SSA is imposing on recipients of Social Security payments to complete this application;
rather, these are theoretical opportunity costs for the additional time respondents will spend to complete the application. There is no actual
charge to respondents to complete the application.
SSA submitted a single new
Information Collection Request which
encompasses the revisions to both
information collections (currently under
OMB Numbers 0960–0174, and 0960–
0454) to OMB for the approval of the
changes due to the proposed rule. After
approval at the final rule stage, we will
adjust the figures associated with the
current OMB numbers for these forms to
reflect the new burden. We are soliciting
comments on the burden estimate; the
need for the information; its practical
utility; ways to enhance its quality,
utility, and clarity; and ways to
minimize the burden on respondents,
including the use of automated
techniques or other forms of information
technology. In addition, we are
specifically seeking comment on
whether you have any questions or
suggestions for edits to the forms
referenced above in the context of this
proposed regulatory change. Questions
to consider might include (but are not
limited to):
(1) Are there other SSA information
collections we have not noted that you
believe we should modify as a result of
this proposed policy change?
(2) Do our new estimated time
burdens accurately represent the time
burden associated with these forms?
The burden estimate should include
both the time needed to answer the
form’s questions and activities such as
the time spent gathering records and
documentation if necessary, or travel
time associated with developing and
submitting the collection. If you believe
our reported estimate is inaccurate
(when considering that we anticipate a
burden reduction associated with the
rulemaking), please explain why.
(3) Are there modifications to the
forms or the information collection
processes associated with developing
information about a recipient’s potential
rental subsidy that the agency should
consider in developing this final rule
(keeping in mind that there may be
policy or operational limitations on our
VerDate Sep<11>2014
15:52 Aug 23, 2023
Jkt 259001
ability to implement some types of new
information collection processes)?
If you would like to submit
comments, please send them to the
following locations:
Office of Management and Budget, Attn:
Desk Officer for SSA, Fax Number:
202–395–6974, Email address: OIRA_
Submission@omb.eop.gov
Social Security Administration, OLCA,
Attn: Reports Clearance Director, Mail
Stop 3253 Altmeyer, 6401 Security
Blvd., Baltimore MD 21235, Fax: 410–
966–2830, Email address:
OR.Reports.Clearance@ssa.gov
You can submit comments until
October 23, 2023, which is 60 days after
the publication of this notice. However,
your comments will be most useful if
you send them to SSA by October 23,
2023, which is 60 days after publication.
To receive a copy of the OMB clearance
package, contact the SSA Reports
Clearance Officer using any of the above
contact methods. We prefer to receive
comments by email or fax.
(Catalog of Federal Domestic Assistance
Programs No 96.006 Supplemental Security
Income)
List of Subjects in 20 CFR Part 416
Administrative practice and
procedure, Reporting and recordkeeping
requirements, Supplemental Security
Income (SSI).
The Acting Commissioner of Social
Security, Kilolo Kijakazi, Ph.D., M.S.W.,
having reviewed and approved this
document, is delegating the authority to
electronically sign this document to
Faye I. Lipsky, who is the primary
Federal Register Liaison for SSA, for
purposes of publication in the Federal
Register.
Faye I. Lipsky,
Federal Register Liaison, Office of Legislation
and Congressional Affairs, Social Security
Administration.
For the reasons stated in the
preamble, we propose to amend 20 CFR
chapter III, part 416, as set forth below:
PO 00000
Frm 00014
Fmt 4702
Sfmt 9990
PART 416—SUPPLEMENTAL
SECURITY INCOME FOR THE AGED,
BLIND, AND DISABLED
Subpart K—Income
1. The authority citation for subpart K
of part 416 is revised to read as follows:
■
Authority: 42 U.S.C. 902(a)(5), 1381a,
1382, 1382a, 1382b, 1382c(f), 1382j, 1383,
and 1383b; sec. 211, Pub. L. 93–66, 87 Stat.
154 (42 U.S.C. 1382 note).
2.In § 416.1130 revise paragraph (b) to
read as follows:
■
§ 416.1130
Introduction
*
*
*
*
*
(b) How we define in-kind support
and maintenance. In-kind support and
maintenance means any food or shelter
that is given to you or that you receive
because someone else pays for it.
Shelter includes room, rent, mortgage
payments, real property taxes, heating
fuel, gas, electricity, water, sewerage,
and garbage collection services. You are
not receiving in-kind support and
maintenance in the form of room or rent
if you are paying the amount charged
under a business arrangement. A
business arrangement exists when the
amount of monthly rent required to be
paid equals or exceeds the presumed
maximum value described in
§ 416.1140(a)(1). If the required amount
of rent is less than the presumed
maximum value, we will impute as inkind support and maintenance the
difference between the required amount
of rent and either the presumed
maximum value or the current market
rental value (see § 416.1101), whichever
is less. In addition, cash payments to
uniformed service members as
allowances for on-base housing or
privatized military housing are in-kind
support and maintenance.
*
*
*
*
*
[FR Doc. 2023–18213 Filed 8–23–23; 8:45 am]
BILLING CODE 4191–02–P
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]]>Agencies
[Federal Register Volume 88, Number 163 (Thursday, August 24, 2023)]
[Proposed Rules]
[Pages 57910-57915]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-18213]
=======================================================================
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SOCIAL SECURITY ADMINISTRATION
20 CFR Part 416
[Docket No. SSA-2023-0010]
RIN 0960-AI82
Expansion of the Rental Subsidy Policy for Supplemental Security
Income (SSI) Applicants and Recipients
AGENCY: Social Security Administration.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: We propose to revise our regulations by applying nationwide
the In-Kind Support and Maintenance (ISM) rental subsidy exception that
is currently in place for SSI applicants and recipients residing in
seven States. The exception recognizes that a ``business arrangement''
exists when the amount of required monthly rent for a property equals
or exceeds the presumed maximum value. This proposed rule would improve
nationwide program uniformity, and, we expect, improve equality in the
application of the rental subsidy policy.
DATES: To ensure that your comments are considered, we must receive
them no later than October 23, 2023.
ADDRESSES: You may submit comments by any one of three methods--
internet, fax, or mail. Do not submit the same comments multiple times
or by more than one method. Regardless of which method you choose,
please state that your comments refer to Docket No. SSA-2023-0010 so
that we may associate your comments with the correct regulation.
Caution: You should be careful to include in your comments only
information that you wish to make publicly available. We strongly urge
you not to include in your comments any personal information, such as
Social Security numbers or medical information.
1. Internet: We strongly recommend that you submit your comments
via the internet. Please visit the Federal eRulemaking portal at
https://www.regulations.gov. Use the ``search'' function to find docket
number SSA-2023-0010. The system will issue a tracking number to
confirm your submission. You will not be able to view your comment
immediately because we must post each comment manually. It may take up
to one week for your comment to be viewable.
2. Fax: Fax comments to 1-833-410-1631.
3. Mail: Mail your comments to the Office of Legislation and
Congressional Affairs, Regulations and Reports Clearance Staff, Mail
Stop 3253 Altmeyer, 6401 Security Blvd., Baltimore, MD 21235.
Comments are available for public viewing on the Federal
eRulemaking portal at https://www.regulations.gov or in person, during
regular business hours, by arranging with the contact person identified
below.
FOR FURTHER INFORMATION CONTACT: Tamara Levingston, Office of Income
Security Programs, 6401 Security Blvd., Robert M. Ball Building, Suite
2512B, Woodlawn, MD 21235, 410-966-7384. For information on eligibility
or filing for benefits, call our national toll-free number, 1-800-772-
1213 or TTY 1-800-325-0778, or visit our internet site, Social Security
Online, at https://www.ssa.gov.
SUPPLEMENTARY INFORMATION:
Background
We administer the SSI program, which provides monthly payments to:
(1) adults and children with a disability or blindness; and (2) adults
aged 65 or older. Eligible individuals must meet all the requirements
in the Social Security Act (Act), including having resources and income
below specified amounts.\1\ Since SSI is a needs-based program for
persons with limited income and resources, we must consider the amount
of income an applicant or recipient has when determining whether that
person is eligible to receive SSI payments. If the individual is
eligible, their income is also a factor in calculating the amount of
their monthly SSI payments.
---------------------------------------------------------------------------
\1\ See 42 U.S.C. 1382 and 20 CFR 416.202 for a list of the
eligibility requirements. See also 20 CFR 416.420 for general
information on how we compute the amount of the monthly payment by
reducing the benefit rate by the amount of countable income as
calculated under the rules in subpart K of 20 part 416.
---------------------------------------------------------------------------
Specifically, once an individual is determined eligible for SSI,
their monthly payment amount is determined by subtracting their
countable monthly income from the Federal benefit rate (FBR),\2\ which
is the monthly maximum Federal SSI payment.\3\ The FBR for 2023 is $914
for an individual and $1,371 for an eligible individual with an
eligible spouse.\4\ Generally, the more income an individual has, the
less their SSI payment will be.\5\ For the purposes of SSI, ``income''
is defined as anything that an individual receives in cash or in kind
that the individual can use to meet their needs for food and
shelter.\6\ The Act and our regulations \7\ define income as
``earned,'' such as wages from work, and ``unearned,'' such as gifted
cash.\8\ Our proposed regulatory change pertains to rental subsidy,
which is a type of ISM under the broader umbrella of unearned income.
---------------------------------------------------------------------------
\2\ See 20 CFR 416.1101.
\3\ See 20 CFR 416.405 through 416.415. Some States supplement
the FBR amount.
\4\ 87 FR 64296, 64298 (2022) A table of the monthly maximum
Federal SSI payment amounts for an eligible individual, and for an
eligible individual with an eligible spouse, is available at https://www.ssa.gov/oact/cola/SSIamts.html. When the FBR is adjusted for
the cost of living, the amount of the potential ISM reduction
adjusts accordingly.
\5\ See 20 CFR 416.1100.
\6\ See 20 CFR 416.1102.
\7\ See 42 U.S.C. 1382a; and 20 CFR 416.1102-1124.
\8\ See 20 CFR 416.1104.
---------------------------------------------------------------------------
ISM
As noted above, income that affects an individual's monthly SSI
payment can also be provided in kind.\9\ Generally, we value in-kind
items at their current market value and apply the various exclusions
for both earned and unearned income; however, we have special rules for
valuing food or shelter that is received as unearned income (ISM).\10\
Under our current regulations, ISM means any food or shelter that is
given to an individual or that the individual receives because someone
else pays for it.\11\ Shelter includes room, rent, mortgage payments,
real property taxes, heating fuel, gas, electricity, water, sewerage,
and garbage collection services.\12\ For example, if an SSI recipient's
brother lets the recipient live rent-free in his home throughout a
calendar month, we would consider the shelter the brother provides as
ISM to the recipient. We have two rules for valuing the ISM that we
must count: (1) currently, the one-third reduction rule (VTR) applies
if the individual is living in the household of a person, throughout a
month, who provides the individual with both food and shelter, and (2)
the presumed maximum value rule (PMV) applies in all other situations
in which the individual is
[[Page 57911]]
receiving countable ISM.\13\ For example, a recipient lives with a
sibling. The recipient receives SNAP to pay for their own food, but
does not pay shelter expenses. The sibling pays all the shelter
expenses. Based on the recipient paying for their own food, SSI is
calculated under the PMV rule. The VTR cannot apply, because the
recipient is not receiving both food and shelter from the household.
---------------------------------------------------------------------------
\9\ See 20 CFR 416.1102.
\10\ See 20 CFR 416.1130(a).
\11\ See 20 CFR 416.1130(b). We recently published a proposed
rule to remove food from the calculation of ISM. See 88 FR 9779
Omitting Food From In-Kind Support and Maintenance Calculations,
published February 15, 2023.
\12\ See 20 CFR 416.1130(b).
\13\ 20 CFR 416.1130(c).
---------------------------------------------------------------------------
The VTR rule is governed by legislation and requires SSA to reduce
the applicable federal benefit rate by one-third when the recipient
receives both food and shelter, throughout a month, from the household
in which they reside.\14\ The PMV rule, which is one-third the federal
benefit rate plus $20, only applies if the recipient receives food or
shelter from within the household. In addition, the PMV rule allows
recipients to rebut the maximum amount of ISM being charged, by
providing the actual value of the ISM being received. Rebuttal is not
an option under the VTR rule.
---------------------------------------------------------------------------
\14\ Social Security Act Sec. 1612(a)(2)(A).
---------------------------------------------------------------------------
Rental Subsidy
Our current regulation further clarifies that an individual is not
receiving ISM in the form of room or rent if they are paying the
required monthly rent charged under a ``business arrangement.'' \15\
Under the current general definition, a ``business arrangement'' exists
when the amount of monthly rent required to be paid equals the current
monthly rental value (CMRV)--that is, the price of the rent on the open
market in the individual's locality.\16\ For example, if the owner of
an apartment would rent that property to any potential tenant for $800
per month, then the CMRV is $800. Consequently, in this example, if an
SSI recipient agrees to pay the landlord rent in the amount of $800 per
month, a ``business arrangement'' would exist and the SSI recipient
would not be receiving ISM in the form of room or rent. Conversely,
under our current general definition of a ``business arrangement,'' if
the SSI recipient rented the same property but paid only $400 per
month, a ``business arrangement'' would not exist because $400 is less
than the CMRV.\17\
---------------------------------------------------------------------------
\15\ 20 CFR 416.1130(b).
\16\ Id. See also 20 CFR 416.1101.
\17\ In this instance, we would apply ISM's PMV rule, as the
individual is receiving some level of support from the landlord by
paying less than the CMRV of the shelter.
---------------------------------------------------------------------------
When we develop possible rental subsidy, we first determine whether
the required monthly rent is equal to the CMRV. In practice, our
technicians must contact the landlord for information on the required
monthly rent or reach out to an appropriate source for information
about the CMRV for that property and locality. This source can be the
landlord or another knowledgeable source (e.g., a real estate firm or
rental management agency). With this information in hand, we then
compare the rent the individual is paying to the CMRV and document the
reason for any reduced monthly rent. If the required monthly rent is
less than the CMRV, we count the difference between the required
monthly rent and the CMRV as ISM to the SSI applicant or recipient.\18\
We use the presumed maximum value (PMV) rule to value this type of ISM.
In valuing shelter under the PMV rule, instead of determining the
actual dollar value of the shelter, we presume that the shelter is
worth one-third of the FBR plus the amount of the $20 general income
exclusion.\19\ SSI applicants and recipients may rebut this presumption
by showing that the value of the ISM they are receiving is less than
the PMV.\20\ Thus, under this current general policy, the amount of ISM
counted is capped at the PMV. Conversely, if the rent equals or exceeds
the CMRV, we determine that there is no rental subsidy.
---------------------------------------------------------------------------
\18\ See Program Operations Manual System (POMS) SI 00835.380E.
\19\ See 20 CFR 416.1140(a).
\20\ See 20 CFR 416.1140(a)(2).
---------------------------------------------------------------------------
Take the example of an SSI recipient living with their ineligible
spouse and child who is renting a single-family home owned by the
recipient's mother. The mother-landlord alleges the property has a CMRV
of $1,500 per month, but she is requiring the SSI household to pay only
$350 in rent per month. To calculate the rental subsidy under the
current general policy, we would subtract the required monthly rent
from the CMRV ($1,500 - $350 = $1,150), in which case the rental
subsidy would be $1,150. We would divide the total rental subsidy by
the number of people in the household ($1,150/3 = $383.33).\21\ Per
regulation, the maximum amount of ISM that can be charged is $324.66 a
month for 2023. Therefore, the recipient's SSI payment is $589.34 ($914
(FBR 2023)--$324.66 (PMV for 2023)). This is with the understanding
that the recipient has no other income.\22\
---------------------------------------------------------------------------
\21\ The method for calculating the rental subsidy is described
in POMS SI 00835.380(E)(1) Procedure for valuing the actual value
(AV) of the rental subsidy. This methodology reflects our ISM
regulatory policy's approach of examining rental subsidy from the
perspective of the household (see e.g., 20 CFR 416.1130).
\22\ See 20 CFR 416.1140(a).
\23\ See 20 CFR 416.1130(b); Jackson v. Schweiker, 683 F.2d 1076
(7th Cir. 1982).
\24\ See Acquiescence Ruling (AR) 90-2(2): Ruppert v. Bowen, 871
F.2d 1172 (2d Cir. 1989)--Evaluation of a Rental Subsidy as In-Kind
Income for Supplemental Security Income (SSI) Benefit Calculation
Purposes--Title XVI of the Social Security Act. If we finalize this
proposed rule, we will rescind AR 90-2(2) as obsolete, in accordance
with 20 CFR 416.1485(e)(4).
\25\ See Diaz v. Chater, No. 3:95-cv-01817-X (N.D. Tex. Apr. 17,
1996); POMS SIDAL 00835.380.
---------------------------------------------------------------------------
The following chart illustrates the above example:
Example 1-- Current General Rental Subsidy Policy
------------------------------------------------------------------------
Equation Application of the example
------------------------------------------------------------------------
CMRV-Required Monthly Rent = Household $1,500 - $350 = $1,150.
ISM.
Household ISM/Number of people in $1,150/3 people in household =
household = ISM/Rental Subsidy to the $383.33.
SSI Recipient.
ISM is capped at the PMV............... $383.33 > $324.66.
SSI payment = FBR-PMV.................. SSI payment = $914 - $324.66 =
$589.34.
------------------------------------------------------------------------
Exception
Following court cases that challenged how we applied ISM rules for
rental subsidy, we provided an exception for residents living in
jurisdictions covered by the Court of Appeals for the Seventh Circuit
(in our regulations),\23\ residents in the Second Circuit (in an
Acquiescence Ruling),\24\ and residents of Texas (in the Program
Operations Manual System).\25\ For residents of these seven excepted
States (Connecticut, New York, Vermont, Illinois, Indiana, Wisconsin,
and Texas), a ``business arrangement'' exists when the required monthly
rent the SSI recipient is required to pay equals or exceeds the
[[Page 57912]]
PMV.\26\ In these States, if the required amount of rent is less than
the PMV, then the value of the rental subsidy is the difference between
the required monthly rent and the PMV or the CMRV, whichever is less.
This means there may be a lower threshold for what qualifies as a
``business arrangement'' for applicants and recipients in these
excepted States because, in many cases, the PMV is lower than the CMRV.
Application of this exception tends to reduce the amount of ISM counted
towards an individual's SSI payment, which generally results in a
higher SSI payment amount. For example, an SSI recipient whose living
arrangement is identical to that discussed in the prior example, but
who resides in one of the seven States in which the exception applies,
would not be charged ISM because the required monthly rent exceeds the
PMV ($350 > $324.66). Consequently, the SSI recipient would continue to
receive the FBR (provided they did not receive any other income
countable for SSI purposes).
---------------------------------------------------------------------------
\26\ See POMS SI 00835.380.B.7.
Example 2--Rental Subsidy Exception Policy Proposed To Be Extended
------------------------------------------------------------------------
------------------------------------------------------------------------
PMV < CMRV............................. $324.66 < $1,500.
Required Monthly Rent > PMV............ $350 > $324.66.
Therefore, no ISM to the SSI Recipient. = SSI Payment = $914.
------------------------------------------------------------------------
As illustrated by these examples, our current application of the
ISM rules is not uniform nationwide, and the exception is an advantage
only for those SSI applicants and recipients living in the seven
excepted States.
Rationale for Regulatory Action
We propose to change the rental subsidy policy in our regulations
by applying nationally the definition of ``business arrangement'' that
currently applies in only seven States because of the court decisions
noted above. The rationale of the courts that resulted in the situation
currently in place in seven states, in particular in the Seventh
Circuit decision in Jackson and the Second Circuit decision in Ruppert,
also supports extending this policy to the other states, as outlined in
our proposed rule. In Jackson, the Seventh Circuit reasoned that it is
not enough for a claimant to be provided shelter at a rate below market
value for that difference to be counted as ``income'' for SSI purposes;
rather, to be counted as ``income,'' the difference between the market
value and the actual rental payment must result in increased purchasing
power to meet the claimant's basic needs.\27\ The Seventh Circuit
explained that ``purchasing power grows if in-kind contributions of
shelter either make cash available to purchase necessities of life
other than shelter or if, and to the extent, the quality of shelter
itself is enhanced to meet basic needs.'' \28\ Similarly, in Ruppert,
the Second Circuit found that the difference between the CMRV and the
required monthly rent does not always constitute an actual economic
benefit which should be counted as ``income'' for SSI purposes.\29\ To
implement Ruppert, for residents of the Second Circuit, we announced
that an applicant or recipient does not receive an ``actual economic
benefit'' from a rental subsidy when the amount of required monthly
rent equals or exceeds the PMV.\30\
---------------------------------------------------------------------------
\27\ Jackson, 683 F.2d at 1082-87; In Jackson, the Seventh
Circuit addressed a situation where ``a very large percentage'' of
an individual's income was already committed to shelter costs before
the agency considered any unearned income from a rental subsidy.
Under those circumstances, the additional value of the rental
subsidy did not increase the individual's ability to pay for their
other basic needs. See also Supplemental Security Income for the
Aged, Blind, and Disabled; Subpart K--Income, 51 FR 13487, 13488
(Apr. 21, 1986).
\28\ Jackson, 683 F.2d at 1084.
\29\ Ruppert, 871 F.2d at 1179-81; Social Security Acquiescence
Ruling (AR) 90-2(2), 55 FR 28947, 28949 (July 16, 1990).
\30\ AR 90-2(2), 55 FR at 28949.
---------------------------------------------------------------------------
Applying nationally the definition of ``business arrangement''
based on the PMV rather than the CMRV, and thus focusing on the SSI
recipient's purchasing power or the actual economic benefit they
receive, would also ensure that all SSI applicants and recipients,
regardless of where they reside, would have the same policy applied to
them regarding the definition of a business arrangement. This uniform
definition of business arrangement means that no recipient's SSI
payment amount would be lower simply because they reside in a State
where the exception policy described above does not currently apply.
This proposed policy change therefore supports our goal of enhancing
equality in the programs we administer for all applicants and
recipients.
This proposal will also foster efficiency in our administration of
the SSI program, because we no longer would have to apply different
policies on the definition of a business arrangement depending on the
SSI applicant or recipient's State of residence. In any program as
large as ours, ``the need for efficiency is self-evident.'' \31\ As
well, we expect that the proposal would improve customer service by
reducing the amount of time we need to calculate SSI payment amounts in
States in which the current exception does not apply. Because the
exception is currently in place in some States, we already have a well-
established procedure for applying the exception, and we are confident
that such a change can be applied nationwide with minimal operational
or systems impact.
---------------------------------------------------------------------------
\31\ See Barnhart v. Thomas, 540 U.S. 20, 29 (2003); Heckler v.
Campbell, 461 U.S. 458, 461, n.2 (1983).
---------------------------------------------------------------------------
We are also proposing this rule in response to specific requests
from the public. Recently, we adopted the Social Security
Administration's Agency Strategic Plan for Fiscal Years 2022-2026
(Strategic Plan),\32\ which defines our long-term goals and objectives
over the next four years to further our overall mission. Among the
stated goals, we resolve to optimize the experience of our customers by
adopting policies aimed at serving individuals and communities. Our
Strategic Plan further commits to engage the public and external
stakeholders to better inform our regulatory activities.\33\
---------------------------------------------------------------------------
\32\ Social Security Administration, Agency Strategic Plan:
Fiscal Years 2022-2026, page 9, Strategic Goal 1: Optimize the
Experience of SSA Customers and Strategic Objective 1.1--Identify
and Address Barriers to Accessing Services. available at: https://www.ssa.gov/agency/asp/.
\33\ Id.
---------------------------------------------------------------------------
In support of these goals, we have been in communication since
October 2022 with advocate groups representing a wide variety of
claimants and beneficiaries from diverse backgrounds. In response, we
received numerous suggestions for ways to improve access to our
programs, particularly to our SSI program. Among the recommendations we
received were suggestions to update and streamline the SSI program's
rules on ISM.
As discussed above, the current lack of uniformity in our business
arrangement definition can disadvantage affected SSI applicants
[[Page 57913]]
and recipients who do not live in States where the rental subsidy
exception applies. The differing application of the business
arrangement definition was noted by the external parties, who
recommended that we apply the current rental subsidy exception
nationwide as one way to streamline the SSI program and make it more
equitable. We agree with this recommendation. The proposed rules, if
finalized, would benefit SSI applicants and recipients, no matter the
State they live in, and make the SSI program easier to administer. The
proposed change would also make the SSI program more equitable by
applying the rental subsidy policy uniformly to all affected SSI
applicants and recipients, regardless of where they live.
Moreover, as explained in the study Simplifying the Supplemental
Security Income Program: Options for Eliminating the Counting of In-
kind Support and Maintenance, ``[a]lthough SSI eligibility was intended
to be determined on the basis of objective information on income and
resources, development of ISM is often based on estimates of food and
shelter expenses provided by the applicant or recipient and verified by
other household members.'' \34\ By applying the rental subsidy
exception nationwide, the rent paid by the SSI applicant or recipient
will be compared to a standard dollar amount--the PMV. Our technicians
anticipate sending out fewer living arrangement development forms (form
SSA-L5061, OMB 0960-0454) by instead confirming the limited necessary
information with the landlord orally, namely: that the required rent
amount is equal to or greater than the PMV.\35\ The more detailed
estimates currently provided by the landlord or other household members
under our existing regulations are therefore less likely to be needed
or used in administering the SSI program. This reduced need to contact
landlords or other third parties for information regarding the CMRV
also increases the efficiency of the SSI program by reducing the number
of instances in which we have to seek out that information (We note
that we would need to contact someone other than the landlord only if
we cannot verify information with the landlord directly.). In summary,
then, this new policy will result in greater efficiency and time
savings for our employees, and a reduction in the reporting burden for
the public (see Paperwork Reduction Act section of the preamble).
---------------------------------------------------------------------------
\34\ See Balkus, Richard; Sears, James; Wilschke, Susan; and
Wixon, Bernard. Simplifying the Supplemental Security Income
Program: Options for Eliminating the Counting of In-kind Support and
Maintenance. Social Security Bulletin, vol. 68, no. 4, 2008,
www.ssa.gov/policy/docs/ssb/v68n4/v68n4p15.html.
\35\ Claimants may provide certain types of evidence (e.g., a
rental agreement or lease) to support their allegation of rent
amount, and in these circumstances an SSA technician does not need
to reach out to the landlord to further develop the allegation.
However, SSA finds that in many circumstances claimants do not
provide SSA with the necessary evidence. In these cases, SSA will
attempt to contact the landlord by phone to orally confirm the rent
amount. If the landlord is not successfully reached, SSA may still
be required to send the form SSA-L5061. SSA seeks comment on
additional procedural considerations and/or acceptable forms of
evidence (e.g., proof of electronic transfer of funds in the alleged
amount to the named landlord) that a claimant might provide that
would be minimally burdensome while satisfactorily demonstrating
proof of rent amount.
---------------------------------------------------------------------------
Proposed Change
As discussed above, we propose to apply nationwide the rental
subsidy exception currently in place in seven States. Accordingly, our
nationwide policy would be that a ``business arrangement'' exists when
the amount of monthly rent required to be paid equals or exceeds the
PMV. If the required amount of rent is less than the PMV, we would
impute as ISM the difference between the required amount of rent and
either the PMV or the CMRV, whichever is less. For example, if the
required household rent is $300, and the CMRV amount is greater than
the PMV, then the amount of household ISM would be $24.66 divided by
the number of household members. However, this charge may be offset by
other exclusions.
Rulemaking Analyses and Notices
We will consider all comments we receive on or before the close of
business on the comment closing date indicated above. The comments will
be available for examination in the rulemaking docket for these rules
at the above address. We will file comments received after the comment
closing date in the docket and may consider those comments to the
extent practicable. However, we will not respond specifically to
untimely comments. We may publish a final rule at any time after close
of the comment period.
Clarity of This Rule
Executive Order 12866, as supplemented by Executive Order 13563 and
Executive Order 14094, requires each agency to write all rules in plain
language. In addition to your substantive comments on this proposed
rule, we invite your comments on how to make the rule easier to
understand.
For example:
Would more, but shorter, sections be better?
Are the requirements in the rule clearly stated?
Have we organized the material to suit your needs?
Could we improve clarity by adding tables, lists, or
diagrams?
What else could we do to make the rule easier to
understand?
Does the rule contain technical language or jargon that is
not clear?
Would a different format make the rule easier to
understand, e.g., grouping and order of sections, use of headings,
paragraphing?
When will we start to use this rule?
We will not use this rule until we evaluate public comments and
publish a final rule in the Federal Register. All final rules include
an effective date. We will continue to use our current rules until that
date. If we publish a final rule, we will include a summary of those
relevant comments we received along with responses and an explanation
of how we will apply the new rule.
Regulatory Procedures
Executive Order 12866, as Supplemented by Executive Order 13563 and
Executive Order 14094
We consulted with the Office of Management and Budget (OMB) and
determined that this rule meets the criteria for a significant
regulatory action under Executive Order 12866, as supplemented by
Executive Order 13563 and Executive Order 14094. Therefore, OMB
reviewed it.
Anticipated Transfers to Our Program
Our Office of the Chief Actuary estimates that implementation of
this proposed rule would result in a total increase in Federal SSI
payments of $971 million over fiscal years 2024 through 2033, assuming
implementation of this rule on April 29, 2024. These transfers reflect
an estimation that approximately 41,000 individuals who would be
eligible under our current rules will have their Federal SSI payment
increased by an average of $128 per month attributable to
implementation of this rule. There would also be an additional 14,000
individuals who are not eligible under current rules who would be newly
eligible and would apply for benefits under the proposed rule.
Anticipated Net Administrative Cost Savings to the Social Security
Administration
The Office of Budget, Finance, and Management estimates that this
proposal will result in net
[[Page 57914]]
administrative savings of $10 million for the 10-year period from FY
2024 to FY 2033. The net administrative savings is mainly a result of
unit time savings as field office employees will not have to spend time
developing CMRV for all rental subsidy calculations during initial
claims, pre-effectuations reviews, redeterminations, and post-
eligibility actions. The savings are offset by costs to update our
systems, costs to send notices to inform current recipients of the
policy changes, costs to address inquiries from the notices, and costs
because of more individuals' being eligible for SSI benefits, which
increases claims, reconsiderations, appeals, redeterminations, and
post-eligibility actions.
Anticipated Time-Savings and Qualitative Benefits to the Public
We anticipate the following qualitative benefits generated from
this proposed policy:
Saving time and effort for claimants and third parties who
may have evidence related to a claimant's application because they
would need to submit less information. SSA estimates at a minimum this
will result in more than 7,000 hours of time saved in annual reduced
paperwork burden, representing an opportunity cost of $1,140,526 (see
the Paperwork Reduction Act section of the preamble below for
specifics).
Potentially get faster determinations or decisions
regarding SSI eligibility or payment amount, or both, which would have
both quantitative effects financially and, qualitatively, may alleviate
stress for applicants and recipients associated with the length of time
it may take to obtain SSI.
Administratively easier to apply the same policy
nationwide.
Anticipated Qualitative Costs
We do not anticipate more than de minimis costs associated with
this rulemaking. We do not anticipate that this proposal would affect
labor market participation in any significant way, in part because of
the limited understanding of the current policy in the beneficiary
community.
Executive Order 13132 (Federalism)
We analyzed this proposed rule in accordance with the principles
and criteria established by Executive Order 13132 and determined that
the proposed rule will not have sufficient Federalism implications to
warrant the preparation of a Federalism assessment. We also determined
that this proposed rule will not preempt any State law or State
regulation or affect the States' abilities to discharge traditional
State governmental functions.
Regulatory Flexibility Act
We certify that this proposed rule will not have a significant
economic impact on a substantial number of small entities because it
affects individuals only. Therefore, a regulatory flexibility analysis
is not required under the Regulatory Flexibility Act, as amended.
Paperwork Reduction Act
This rule does not anticipate any new collections or require
revisions to existing collections. However, the application of the
revisions to these rules may cause a burden change to our currently
approved information collections under the following information
collection requests: 0960-0174, the SSA-8006, Statement of Living
Arrangements, In-Kind Support and Maintenance; and 0960-0454, the SSA-
L5061, Letter to Landlord Requesting Rental Information. Based on our
current management information data from the seven states currently
implementing these changes, we anticipate these changes will allow for
verbal responses from landlords in place of the current form in some
situations, thus reducing the overall burden as SSA will not require
those respondents to complete the entirety of Form SSA-L51061. In
addition, we note that for those who use the paper form, we will send a
revised version with question #5 removed. We also anticipate a slight
burden reduction to Form SSA-8006, as the respondents may not need to
provide as much detail pertaining to their rental subsidy agreement due
to the proposed rule.
The following chart shows the time burden information associated
with the proposed rule:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Anticipated Anticipated
Current Current new burden estimated
average estimated per total Estimated
OMB No.; form No.; CFR citations Number of Frequency burden per total response burden burden
respondents of response response burden under under savings
(minutes) (hours) regulation regulation (hours)
(minutes) (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0960-0174 SSA-8006 (Paper Form).............................. 12,160 1 7 1,419 6 1,216 203
0960-0174 SSA-8006 (SSI Claims System)....................... 109,436 1 7 12,768 6 10,944 1,824
0960-0454 SSA-L5061 (Paper Form)............................. 35,640 1 10 5,940 8 4,752 1,188
0960-0454 SSA-L5061 (Phone Call)............................. 35,640 1 10 5,940 3 1,782 4,158
------------------------------------------------------------------------------------------
Totals................................................... 192,876 ........... ........... 26,067 ........... 18,694 7,373
--------------------------------------------------------------------------------------------------------------------------------------------------------
The following chart shows the theoretical cost burdens associated
with the proposed rule:
----------------------------------------------------------------------------------------------------------------
Anticipated Average
estimated Average combined wait
total burden theoretical time in field Total annual
OMB No.; form No.; CFR citations Number of under hourly cost office and/or opportunity
respondents regulation amount teleservice cost (dollars)
from chart (dollars) * centers ***
above (hours) (minutes) **
----------------------------------------------------------------------------------------------------------------
0960-0174 SSA-8006 (Paper Form). 12,160 1,216 * $12.81 ** 19 *** $77,885
0960-0174 SSA-8006 (SSI Claims 109,436 10,944 * 12.81 ** 24 *** 443,931
System)........................
0960-0454 SSA-L5061 (Paper Form) 35,640 4,752 * 29.76 ** 24 *** 565,678
0960-0454 SSA-L5061 (Phone Call) 35,640 1,782 * 29.76 .............. *** 53,032
-------------------------------------------------------------------------------
[[Page 57915]]
Totals...................... 192,876 19,882 .............. .............. *** 1,140,526
----------------------------------------------------------------------------------------------------------------
* We based this figure on the average DI payments based on SSA's current FY 2023 data (https://www.ssa.gov/legislation/2023factsheet.pdf); on the average U.S. citizen's hourly salary, as reported by Bureau of Labor
Statistics data (https://www.bls.gov/oes/current/oes_nat.htm).
** We based this figure on the average FY 2023 wait times for field offices and hearings office, as well as by
averaging both the average FY 2023 wait times for field offices and teleservice centers, based on SSA's
current management information data.
*** This figure does not represent actual costs that SSA is imposing on recipients of Social Security payments
to complete this application; rather, these are theoretical opportunity costs for the additional time
respondents will spend to complete the application. There is no actual charge to respondents to complete the
application.
SSA submitted a single new Information Collection Request which
encompasses the revisions to both information collections (currently
under OMB Numbers 0960-0174, and 0960-0454) to OMB for the approval of
the changes due to the proposed rule. After approval at the final rule
stage, we will adjust the figures associated with the current OMB
numbers for these forms to reflect the new burden. We are soliciting
comments on the burden estimate; the need for the information; its
practical utility; ways to enhance its quality, utility, and clarity;
and ways to minimize the burden on respondents, including the use of
automated techniques or other forms of information technology. In
addition, we are specifically seeking comment on whether you have any
questions or suggestions for edits to the forms referenced above in the
context of this proposed regulatory change. Questions to consider might
include (but are not limited to):
(1) Are there other SSA information collections we have not noted
that you believe we should modify as a result of this proposed policy
change?
(2) Do our new estimated time burdens accurately represent the time
burden associated with these forms? The burden estimate should include
both the time needed to answer the form's questions and activities such
as the time spent gathering records and documentation if necessary, or
travel time associated with developing and submitting the collection.
If you believe our reported estimate is inaccurate (when considering
that we anticipate a burden reduction associated with the rulemaking),
please explain why.
(3) Are there modifications to the forms or the information
collection processes associated with developing information about a
recipient's potential rental subsidy that the agency should consider in
developing this final rule (keeping in mind that there may be policy or
operational limitations on our ability to implement some types of new
information collection processes)?
If you would like to submit comments, please send them to the
following locations:
Office of Management and Budget, Attn: Desk Officer for SSA, Fax
Number: 202-395-6974, Email address: [email protected]
Social Security Administration, OLCA, Attn: Reports Clearance Director,
Mail Stop 3253 Altmeyer, 6401 Security Blvd., Baltimore MD 21235, Fax:
410-966-2830, Email address: [email protected]
You can submit comments until October 23, 2023, which is 60 days
after the publication of this notice. However, your comments will be
most useful if you send them to SSA by October 23, 2023, which is 60
days after publication. To receive a copy of the OMB clearance package,
contact the SSA Reports Clearance Officer using any of the above
contact methods. We prefer to receive comments by email or fax.
(Catalog of Federal Domestic Assistance Programs No 96.006
Supplemental Security Income)
List of Subjects in 20 CFR Part 416
Administrative practice and procedure, Reporting and recordkeeping
requirements, Supplemental Security Income (SSI).
The Acting Commissioner of Social Security, Kilolo Kijakazi, Ph.D.,
M.S.W., having reviewed and approved this document, is delegating the
authority to electronically sign this document to Faye I. Lipsky, who
is the primary Federal Register Liaison for SSA, for purposes of
publication in the Federal Register.
Faye I. Lipsky,
Federal Register Liaison, Office of Legislation and Congressional
Affairs, Social Security Administration.
For the reasons stated in the preamble, we propose to amend 20 CFR
chapter III, part 416, as set forth below:
PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND
DISABLED
Subpart K--Income
0
1. The authority citation for subpart K of part 416 is revised to read
as follows:
Authority: 42 U.S.C. 902(a)(5), 1381a, 1382, 1382a, 1382b,
1382c(f), 1382j, 1383, and 1383b; sec. 211, Pub. L. 93-66, 87 Stat.
154 (42 U.S.C. 1382 note).
0
2.In Sec. 416.1130 revise paragraph (b) to read as follows:
Sec. 416.1130 Introduction
* * * * *
(b) How we define in-kind support and maintenance. In-kind support
and maintenance means any food or shelter that is given to you or that
you receive because someone else pays for it. Shelter includes room,
rent, mortgage payments, real property taxes, heating fuel, gas,
electricity, water, sewerage, and garbage collection services. You are
not receiving in-kind support and maintenance in the form of room or
rent if you are paying the amount charged under a business arrangement.
A business arrangement exists when the amount of monthly rent required
to be paid equals or exceeds the presumed maximum value described in
Sec. 416.1140(a)(1). If the required amount of rent is less than the
presumed maximum value, we will impute as in-kind support and
maintenance the difference between the required amount of rent and
either the presumed maximum value or the current market rental value
(see Sec. 416.1101), whichever is less. In addition, cash payments to
uniformed service members as allowances for on-base housing or
privatized military housing are in-kind support and maintenance.
* * * * *
[FR Doc. 2023-18213 Filed 8-23-23; 8:45 am]
BILLING CODE 4191-02-P
