STATE OF NORTH CAROLINA IN THE OFFICE OF

ADMINISTRATIVE HEARINGS

COUNTY OF DURHAM 07 DHR 1214

CAROLYN E. REED, )

Petitioner, )

)

v. )

) DECISION

N.C. DEPARTMENT OF HEALTH )

AND HUMAN SERVICES, DIVISION )

OF SOCIAL SERVICES PROGRAM )

INTEGRITY AFDC/WORK FIRST )

Respondent. )

)

This matter came on for hearing before the undersigned Administrative Law Judge on May 21, 2008, in Raleigh, North Carolina. The Petitioner, Carolyn Reed, appeared pro se and testified in her own behalf. The Respondent was represented by Richard J. Votta, Assistant Attorney General and presented one witness, Markette Hester, Consultant, Family Support and Child Care Section, Division of Social Services, North Carolina Department of Health and Human Services. The Respondent introduced two exhibits which were received into evidence. Also included of record on behalf of the Respondent is an Affidavit of Markette Hester dated November 6, 2007 previously submitted in support of the Respondent’s Motion for Summary Judgment filed in this matter on November 7, 2006. The Petitioner tendered one exhibit which was not moved into evidence.

ISSUES

1. Whether the Department of Health and Human Services properly intercepted the Petitioner’s North Carolina income tax refund on or about July 19, 2007 in the amount of $581.00 for the recovery of benefits overpaid to the Petitioner in the amount of $905.00 by the Temporary Assistance for Needy Families Program (TANF).

2. Whether the Department of Health and Human Services gave proper notice to the Petitioner regarding her rights to challenge the basis for the overpayment subject to the tax intercept at issue when the debt was established by the Durham County Department of Social Services on August 5, 2002.

FINDINGS OF FACT

1. The Petitioner received overpayments of TANF benefits from the Durham County Department of Social Services from June 1, 2001 to October 31, 2001 in the amount of $905.00. This debt for overpaid benefits was established by the county against the Petitioner as of August 5, 2002.

3. The Petitioner’s State income tax refund in the amount of $581.00 was intercepted by the North Carolina Department of Revenue on behalf of the Respondent on or about July 19, 2007. At the time of the State intercept there was an outstanding balance in the full amount of $905.00 on the Petitioner’s TANF debt.

4. On July 23, 2002 the Durham County Department of Social Services mailed a letter to the Petitioner notifying her that a possible overpayment had been identified and scheduling an appointment to discuss the overpayment with her. (Respondent’s Exhibit 1) The Petitioner did not keep the appointment as scheduled or otherwise respond to this letter or seek to reschedule the appointment.

5. On August 6, 2002 a Letter of Overpayment was generated by the Enterprise Program Integrity Control System (EPICS) maintained by the North Carolina Department of Health and Human Services and mailed to the Petitioner. (Respondent’s Exhibit 2) This letter notified the Petitioner that the overpayment in question had been established by the county. This letter also notified the Petitioner that the debt was subject to referral to the North Carolina Department of Revenue for collection by State income tax refund intercept, and it advised her of her due process rights to appeal the validity and the amount of the claim against her and the deadlines for doing so. The Petitioner did not respond to this letter.

6. Both the appointment letter dated July 23, 2002 and the Letter of Overpayment dated August 6, 2002 were mailed to the Petitioner at 1208 Elmira Avenue in Durham, North Carolina 27707. This address was at all relevant times the most recent address provided by the Petitioner to the Respondent, and it was the address at the time of the overpayments in question. There is no record indicating that these letters were not delivered as addressed or that they were returned by the postal service. Records maintained by the Respondent in the ordinary course of business would have noted any such delivery problem.

7. The Petitioner testified that when she received notice that her TANF benefits would be terminated, she did not contact the county. The Petitioner further testified that prior to issuance of the letters of July 23, 2002 and August 6, 2002 providing formal notice of the overpayments at issue, she had moved away from the Elmira Avenue address in Durham. She testified that she did not notify the county of her change in address.

8. The Petitioner failed to report a change of address to the Respondent when she moved away from the Elmira Avenue address in Durham.

Based upon the foregoing Findings of Fact, this Court makes the following:

CONCLUSIONS OF LAW

1. The parties are properly before the Office of Administrative Hearings (OAH), and OAH has jurisdiction over the interception of the Petitioner’s North Carolina income tax refund herein at issue.

2. The Respondent Department is authorized to establish, supervise and monitor the TANF Program (currently known as the Work First Program), which is administered and operated by the county departments of social services pursuant to Chapter 108A, Article 2, Parts 1 and 2 of the North Carolina General Statutes.

3. Pursuant to 45 C.F.R. § 233.20(a)(13) and Chapter 105A of the North Carolina General Statutes, the Respondent Department is required to collect from the Petitioner the $905.00 in overpaid TANF benefits received by her.

4. The Petitioner was required by State rules and policies promulgated by the Department and as authorized by law to report any change in her circumstances which might affect her eligibility to receive TANF benefits, including a change of address or county of residence. North Carolina Temporary Assistance for Needy Families State Plan; 10A N.C.A.C. 71W; DHHS Work First Manual, Section 104, IV.

5. The Respondent gave proper notice to the Petitioner as required by law regarding her due process rights to challenge the validity and the amount of the overpayment subject to the tax intercept at issue in this action at the time the debt was established by the Durham County of Social Services on August 5, 2002.

6. Because the Petitioner had a balance of $905.00 on her TANF debt at the time the State tax refund of $581.00 was intercepted on July 19, 2007, the interception was proper under Chapter 105A of the North Carolina General Statutes.

Based on the foregoing Findings of Fact and Conclusions of Law, the undersigned enters the following

DECISION

The Department of Health and Human Services properly intercepted the Petitioner’s North Carolina income tax refund on or about July 19, 2007 in the amount of $581.00 for the recovery of benefits overpaid to the Petitioner in the amount of $905.00 by the Temporary Assistance for Needy Families Program (TANF).

NOTICE

The agency making the final decision in this contested case shall adopt the Decision of the Administrative Law Judge unless the agency demonstrates that the Decision of the Administrative Law Judge is clearly contrary to the preponderance of the admissible evidence in the official record. The agency is required to give each party an opportunity to file exceptions to this Decision issued by the Undersigned, and to present written arguments to those in the agency who will make the final decision. N.C. Gen. Stat. §150B-36(a).

In accordance with N.C. Gen. Stat. §150B-36, the agency shall adopt each finding of fact contained in the Administrative Law Judge’s decision unless the finding is clearly contrary to the preponderance of the admissible evidence, giving due regard to the opportunity of the Administrative Law Judge to evaluate the credibility of witnesses. For each finding of fact not adopted by the agency, the agency shall set forth separately and in detail the reasons for not adopting the finding of fact and the evidence in the record relied upon by the agency. Every finding of fact not specifically rejected as required by Chapter 150B-36 shall be deemed accepted for purposes of judicial review. For each new finding of fact made by the agency that is not contained in the Administrative Law Judge’s decision, the agency shall set forth separately and in detail the evidence in the record relied upon by the agency establishing that the new finding of fact is supported by a preponderance of the evidence in the official record.

The agency that will make the final decision in this case is the North Carolina Department of Health and Human Services, Division of Social Services. This agency is required by N.C. Gen. Stat. §150B-36(b) to serve a copy of the final decision on all parties and to furnish a copy to the parties’ attorneys of record and to the Office of Administrative Hearings.

IT IS SO ORDERED.

This is the 21st day of July, 2008.

______

Joe L. Webster

Administrative Law Judge