New York Law Review

Tag: Matter of Sherman

  • Matter of Sherman v. St. Dept. of Soc. Servs., 46 N.Y.2d 572 (1979): How Educational Grants Affect AFDC Eligibility

    Matter of Sherman v. St. Dept. of Soc. Servs., 46 N.Y.2d 572 (1979)

    When determining eligibility for Aid to Families with Dependent Children (AFDC), state agencies may allocate federal educational grants first to educational expenses, then state and private educational grants to any remaining expenses, and consider any surplus from those grants as available income.

    Summary

    This case addresses how educational grants should be considered when calculating eligibility for AFDC benefits. Sherman, an AFDC recipient attending business college, received both federal (BEOG) and state (TAP) educational grants. The county social services department first applied the federal grant to her educational expenses, then applied the state grant to any remaining expenses, considering the balance of the state grant as available income. The New York Court of Appeals upheld this method, finding that it was a reasonable interpretation of federal and state regulations and served the dual purposes of supporting education and responsible use of public assistance funds. This case clarifies the permissible methods for calculating available income when an AFDC recipient also receives educational grants.

    Facts

    Petitioner Sherman was eligible for AFDC while attending Albany Business College.
    Her educational expenses (tuition, fees, and books) totaled $925.
    She received a Federal Basic Education Opportunity Grant (BEOG) of $700 and a New York Tuition Assistance Program (TAP) grant of $750.
    The Albany County Department of Social Services calculated her AFDC entitlement by:
    1. Applying the BEOG to educational expenses, leaving $225 in unmet expenses.
    2. Allocating $225 of the TAP grant to cover the remaining expenses.
    3. Considering the remaining $525 of the TAP grant as available income in calculating her AFDC allowance.

    Procedural History

    The State Commissioner of Social Services upheld the county department’s action after a fair hearing.
    Sherman initiated a CPLR article 78 proceeding to review the Commissioner’s determination.
    Special Term annulled the determination.
    The Appellate Division reversed Special Term’s decision.
    The New York Court of Appeals affirmed the Appellate Division’s order, upholding the computation method.

    Issue(s)

    Whether, in computing the amount by which non-Federal educational awards exceed necessary school expenses for the purpose of determining AFDC allowances, it is permissible to first reduce such expenses by the amount of BEOG or other Federal educational grants.

    Holding

    Yes, because the interpretation placed on the statutes by the commissioner should be accepted if it is not irrational or unreasonable, and, absent an explicit restriction, it is not irrational to apply an educational grant to educational expenses, the very purpose for which the grant was awarded.

    Court’s Reasoning

    The court found that the commissioner’s interpretation of the relevant statutes and regulations was not irrational or unreasonable. It stated, “Initially we observe that the interpretation placed on the statutes by the commissioner should be accepted if it is not irrational or unreasonable”.
    The court reasoned that since there was a restriction on applying any excess federal grant funds (BEOG), but no such restriction on the state grant (TAP), it was permissible for the commissioner to prioritize the application of the federal grant first. This maximized the reduction in the public assistance grant.
    The court emphasized that the purpose of both educational grants was to meet the costs of education, not to provide the recipient with excess funds, noting, “From the recipient’s point of view, much as she might enjoy the use of the additional funds, it was the purpose of both educational grants to meet the legitimate costs of education, not to provide the grantee with free funds in excess thereof.”
    The court noted that the allocation procedure employed by the State commissioner satisfied the objective of the educational grant programs and the objectives of the AFDC program, while also practicing a responsibly frugal stewardship of available public assistance funds. It observed: “The allocation procedure employed by the State commissioner satisfies both the objective of the educational grant programs (to enable the grantee to obtain an education which otherwise might be denied her) and the two-fold objectives of the AFDC program…while practicing a responsibly frugal stewardship of available public assistance funds.”
    The court also highlighted the advice from officials of the Federal Department of Health, Education and Welfare, who indicated that the allocation procedures used by the State commissioner were acceptable from both a legal and programmatic standpoint.