Section 402(a)(7) of the Social Security Act requires state
agencies in administering the Aid to Families with Dependent
Children (AFDC) program to "take into consideration . . . any
expenses reasonably attributable to the earning of . . . income."
Such expenses are deducted from an AFDC applicant's income in
determining eligibility for assistance. Colorado's AFDC
regulations, which previously had permitted the deduction from
income of all expenses reasonably attributable to employment,
including transportation expenses, were amended in 1970 to subject
work-related expenses (with certain exceptions) to a uniform
allowance of $30 per month. This substantially reduced respondent's
monthly deductions for work-related transportation expenses and the
corresponding increase in her monthly net income made her
ineligible for continued AFDC assistance. She then brought this
action for injunctive and declaratory relief, claiming,
inter
alia, that Colorado's standardized work expense allowance
violated § 402(a)(7). The District Court granted summary judgment
for respondent, and the Court of Appeals affirmed.
Held: The Colorado regulation conflicts with §
402(a)(7), and is therefore invalid. Pp.
416 U. S.
258-266.
(a) In light of the statute's legislative history and the normal
meaning of the term "any," the language of § 402(a)(7) requiring
the consideration of "any" reasonable work expenses in determining
eligibility for AFDC assistance is to be interpreted as a
congressional directive that no limitation, apart from that of
reasonableness, may be placed upon recognition of work-related
expenses, and hence a fixed work expense allowance that does not
permit deductions for expenses exceeding that standard directly
contravenes the language of the statute. P.
416 U. S.
260.
(b) Standardized treatment of work-related expenses without
provision for showing actual and reasonable expenses exceeding the
standard amount threatens to defeat the purpose of the
Page 416 U. S. 252
mandatory work expense recognition provision of § 402(a)(7) of
encouraging AFDC recipients to secure and retain employment, since,
by limiting work expenses to $30 per month, the Colorado regulation
results in a disincentive to seek or retain employment for all
recipients whose reasonable work-related expenses exceed or would
exceed that amount. Pp.
416 U. S.
263-265.
(c) It is not the adoption of a standardized work expense
allowance
per se that violates § 402(a)(7), but the fact
that the standard is, in effect, a maximum or absolute limitation
upon the recognition of such expenses. P.
416 U. S.
265.
475 F.2d 731, affirmed.
POWELL, J., delivered the opinion for a unanimous Court.
MR. .JUSTICE POWELL delivered the opinion of the Court.
In administering the Aid to Families with Dependent Children
(AFDC) program of the Social Security Act of 1935, as amended
(Act), 42 U.S.C. § 601
et seq., state agencies are
required by § 402(a)(7) of the Act, 81 Stat. 881, 42 U.S.C. §
602(a)(7), to "take into consideration . . . any expenses
reasonably attributable to the earning of . . . income." Such
employment-related expenses are deducted from an AFDC applicant's
income in the process of determining eligibility for assistance. We
granted certiorari, 414 U.S. 999 (1973), to determine whether, in
light of § 402(a)(7), a State may adopt a standardized allowance
for expenses attributable to the
Page 416 U. S. 253
earning of income which does not allow an applicant to deduct
expenses that exceed the standard. We hold that it may not.
I
The AFDC program is designed to provide financial assistance to
needy dependent children and the parents or relatives who live with
and care for them. A principal purpose of the program, as indicated
by 42 U.S.C. § 601, is to help such parents and relatives
"to attain or retain capability for the maximum self support and
personal independence consistent with the maintenance of continuing
parental care and protection. . . ."
The program "is based on a scheme of cooperative federalism,"
King v. Smith, 392 U. S. 309,
392 U. S. 316
(1968). It is financed in large measure by the Federal Government
on a matching-fund basis, and participating States must submit AFDC
plans in conformity with the Act and the regulations promulgated
thereunder by the Department of Health, Education, and Welfare
(HEW). The program is, however, administered by the States, which
are given broad discretion in determining both the standard of need
and the level of benefits.
See Jefferson v. Hackney,
406 U. S. 535,
406 U. S. 541
(1972);
Rosado v. Wyman. 397 U. S. 397,
397 U. S.
408-409 (1970);
Dandridge v. Williams,
397 U. S. 471,
397 U. S. 478
(1970);
King v. Smith, supra, at
392 U. S.
318-319.
Under HEW regulations, all AFDC plans must specify a state-wide
standard of need, which is the amount deemed necessary by the State
to maintain a hypothetical family at a subsistence level. Both
eligibility for AFDC assistance and the amount of benefits to be
granted an individual applicant are based on a comparison of the
State's standard of need with the income and resources available to
that applicant. 45 CFR § 233.20(a)(2)(i). The "income and
resources" attributable to an applicant, defined in 45 CFR §
233.20(a)(6) (iii-viii),
Page 416 U. S. 254
consist generally of "only such net income as is actually
available for current use on a regular basis . . . and only
currently available resources." 45 CFR § 233.20(a)(3)(ii)(c).
See also HEW, Simplified Methods for Consideration of
Income and Resources (1965). In determining net income, any
expenses reasonably attributable to the earning of income are
deducted from gross income. 42 U.S.C. § 602(a)(7). If, taking into
account these deductions and other deductions not at issue in the
instant case, the net amount of "earned income" is less than the
predetermined state-wide standard of need, the applicant is
eligible for participation in the program, and the amount of the
assistance payments will be based upon that difference. 45 CFR § §
233.20(a)(3)(ii)(a) and (c). Prior to May, 1970, Colorado's AFDC
regulations permitted the deduction from income of all expenses
reasonably attributable to employment, including but not limited to
the actual cost of transportation, if "essential to retain
employment." [
Footnote 1] Child
care expenses and mandatory payroll deductions were also treated as
employment-related expenses, and all such expenses were computed on
an individualized basis. In May, 1970, this policy was changed by
the establishment of a maximum transportation work expense
allowance of either $30 per month, if the use of a car was
essential, or the actual
Page 416 U. S. 255
expense of public transportation. Effective July 1, 1970, the
Colorado work expense allowance regulation was again amended to
provide that, in addition to mandatory payroll deductions and child
care expenses:
"For employment expenses such as transportation, special
clothing, union dues, special education or training costs,
telephone, additional food or personal needs, etc., which are an
obligation due to the employment, an allowance of $30 per month is
made for such costs. [
Footnote
2]"
Thus, while Colorado continued to allow individualized treatment
of mandatory payroll deductions and child care costs, all other
work-related expenses were subjected to a uniform allowance of $30,
even if an applicant could prove actual expenses in excess of that
figure. The Regional Commissioner of the Social and Rehabilitation
Service of HEW thereafter accepted the incorporation of this
provision into Colorado's AFDC plan. [
Footnote 3]
Page 416 U. S. 256
When this suit was commenced in July, 1970, Mrs. Vialpando was
employed some eight miles from the small Colorado community in
which she resided with her two-year-old daughter. Since no public
transportation was available, respondent traveled to and from work
each day in a used automobile she had purchased for that purpose.
In making the requisite eligibility and assistance determinations
under the Colorado AFDC program, Mr. Vialpando had been permitted
to deduct $47.30 in mileage costs and $63.81 in car payments
[
Footnote 4]
Page 416 U. S. 257
from her monthly gross income. These deductions of approximately
$110 per month, coupled with child care and mandatory payroll
deductions, entitled her to an AFDC grant of $74 per month for
herself and her daughter. The effect of the July, 1970, amendment
of the Colorado AFDC regulations was to reduce respondent's monthly
deductions for transportation expenses related to employment from
$110 to $30. The corresponding increase in her monthly net earned
income rendered her ineligible for continued AFDC assistance.
[
Footnote 5]
Respondent thereupon brought this class action in the United
States District Court for the District of Colorado under 42 U.S.C.
§ 1983 and 28 U.S.C. §§ 1343(3) and (4). She sought the convening
of a three-judge District Court, and requested injunctive relief
and a declaratory judgment that the Colorado standardized work
expense allowance violated § 402(a)(7) of the Act and the Equal
Protection Clause of the Fourteenth Amendment. Named as defendants
were the Executive Director of the Colorado Department of Social
Services and other state
Page 416 U. S. 258
officers involved in administering Colorado's AFDC program. Upon
stipulated facts and in reliance upon § 402(a)(7) of the Act, the
District Court, in an unreported order, granted respondent's motion
for summary judgment and enjoined enforcement of the challenged
regulation. [
Footnote 6]
Finding the pendent federal statutory claim dispositive, the
District Court properly did not reach the constitutional issue, and
properly did not convene a three-judge court.
Hagans v.
Lavine, 415 U. S. 528
(1974).
The United States Court of Appeals for the Tenth Circuit
affirmed. 475 F.2d 731 (1973). Relying on the language and the
legislative history of § 402(a)(7) and on other provisions of the
Act, the court interpreted the words "any expenses" in § 402(a)(7)
to mean "all actual expenses," and held that the standardized
allowance did not meet this requirement. The court reasoned that
the statute could be read to permit the use of a standardized
allowance for employment expenses, but only where such an allowance
was adequate to cover all actual expenses. We agree.
II
The Social Security Act of 1935, as originally enacted, 49 Stat.
620, did not expressly require that States allow AFDC beneficiaries
to deduct from gross income expenses incurred in connection with
the earning of income. The precursor to § 402(a)(7), which appeared
in the 1939
Page 416 U. S. 259
amendments to the Act, 53 Stat. 1379, provided simply that
"the State agency shall, in determining need, take into
consideration any other income and resources of any child claiming
aid to dependent children."
The Social Security Board, the federal entity then overseeing
the categorical public assistance programs, soon recognized that,
under the predecessor of the AFDC program, [
Footnote 7] recipient families with working members
incurred certain employment-related expenses that reduced available
income but were not taken into account by the States in determining
eligibility for AFDC assistance. In keeping with the Act's purpose
of encouraging employment even when the income produced thereby did
not eliminate entirely the need for public assistance, the Board
recognized that a failure to consider work-related expenses could
result in a disincentive to seek or retain employment. Accordingly,
the States were permitted, but not required, to allow credit for
work-related expenses in determining eligibility. [
Footnote 8]
Page 416 U. S. 260
As part of a general amendment of the Act in 1962, Pub.L.
87-543, 76 Stat. 185, Congress made mandatory the widespread but
then optional practice of deducting employment expenses from total
income in determining eligibility for assistance. Section 402(a)(7)
of the Act as thus amended provided in relevant part:
"[T]he State agency shall, in determining need, take into
consideration any other income and resources of any child or
relative claiming aid to families with dependent children,
as
well as any expenses reasonably attributable to the earning of any
such income. . . ."
(Emphasis added.)
By its terms, § 402(a)(7) requires the consideration of "any"
reasonable work expenses in determining eligibility for AFDC
assistance. In light of the evolution of the statute and the normal
meaning of the term "any," we read this language as a congressional
directive that no limitation, apart from that of reasonableness,
may be placed upon the recognition of expenses attributable to the
earning of income. Accordingly, a fixed work expense allowance
which does not permit deductions for expenses in excess of that
standard is directly contrary to the language of the statute.
Petitioners, relying upon the "take into consideration" phrase
of § 402(a)(7), argue that the requirement of "consideration" is
satisfied by the use of a statistical average of the actual
expenses of all AFDC participants in the State. But this argument
ignores the fact that the phrase
"take into consideration' modifies 'income and resources . . .
as well as any expenses reasonably attributable to the
earning of any such income"
(emphasis added). Thus, it seems inescapable that whatever
treatment is accorded income must also be extended to expenses
attributable to the earning of income. And it has consistently been
the practice to compute the income of an AFDC applicant on an
individual basis.
Page 416 U. S. 261
From the inception of the Act, Congress has sought to ensure
that AFDC assistance is provided only to needy families, and that
the amount of assistance actually paid is based on the amount
needed in the
individual case after other income and
resources are considered. [
Footnote
9] Congress has been careful to ensure that all of the income
and resources properly attributable to a particular applicant be
taken into account, and this individualized approach has been
reflected in the implementing regulations. For example, HEW's broad
definition of "earned income" as
"income in cash or in kind earned by a needy individual through
the receipt of wages, salary, commissions, or profit from
activities in which he is engaged as a self-employed individual or
as an employee,"
45 CFR § 233.20(a)(6)(iii), and its more specific descriptions
of commissioned, salaried, and self-employment derived income in 45
CFR §§ 233.20(a)(6) (iv-viii), [
Footnote 10] demonstrate its view that the
determination
Page 416 U. S. 262
of need in each case is to be based upon an assessment of the
particular individual's available income and resources. Moreover,
individualized consideration of available income and resources is
clearly contemplated by HEW regulations providing for the exclusion
of such items as scholarship funds and loans,
see 45 CFR
§§ 233.20(a)(3)(ii-vii), and requiring that certain items such as
food stamps be deducted, 45 CFR § 233.20(a)(4). Thus, if income and
expenses related to the production of income are to be treated
alike, as the terms of § 402(a)(7) appear to require, both must be
considered on an individualized basis. [
Footnote 11]
Page 416 U. S. 263
The literal import of § 402(a)(7) is confirmed by the statute's
legislative history. The congressional purpose in requiring the
States to take into consideration employment expenses was clearly
set forth in S.Rep. No. 1589, 87th Cong., 2d Sess., 17-18 (1962),
which explained:
"Under present law . . . States are permitted, but not required,
to take into consideration the expenses an individual has in
earning any income (this practice is not uniform in the country
and, in a substantial number of States, full consideration of such
expenses is not given). The committee believes that it is only
reasonable for the States to take these expenses
fully
into account.
Under existing law, if these work expenses are
not considered in determining need, they have the effect of
providing a disincentive to working, since that portion of the
family budget spent for work expenses has the effect of reducing
the amount available for food, clothing, and shelter. The bill
has, therefore, added a provision in all assistance titles
requiring the States to give consideration to any expenses
reasonably attributable to the earning of income."
(Emphasis added.) Virtually identical language appears in the
House Report.
See H.R.Rep. No. 1414, 87th Cong., 2d Sess.,
23 (1962).
Page 416 U. S. 264
Congress thus sought to encourage AFDC recipients to secure and
retain employment by requiring the States to take into account
fully any expenses attributable to the earning of income in
determining eligibility for assistance. Such expenses reduce the
level of actually available income, and, if not deducted from gross
income, will not produce a corresponding increase in AFDC
assistance. Failing to allow the deduction of reasonable expenses
might well discourage the applicant from seeking or retaining
employment whereby such expenses are incurred. Section 402(a)(7)
was aimed at removing this disincentive. As then-Secretary of HEW
Ribicoff explained the legislation in testimony before the
Senate:
"[W]e are trying to do . . . everything we can to encourage
people to get a job and work, and we feel it is important to
encourage the States. By having this provision, the State will take
into account these expenses so people will get jobs. I believe that
the State should give them an allowance for those items that are
necessary for them to get the job."
Hearings on the Public Assistance Act of 1962 before the Senate
Committee on Finance, 87th Cong., 2d Sess., 152 (1962). [
Footnote 12]
Standardized treatment of employment-related expenses without
provision for demonstrating actual and reasonable expenses in
excess of that standard amount,
Page 416 U. S. 265
such as Colorado has adopted, threatens to defeat the goal
Congress sought to achieve in adopting the mandatory work expense
recognition provisions of § 402(a)(7). By limiting employment
expenses to $30 per month, the Colorado regulation results in a
disincentive to seek or retain employment for all recipients whose
reasonable work-related expenses exceed or would exceed that
amount. Accordingly, the Colorado regulation conflicts with federal
law, and is therefore invalid.
It is, of course, not the adoption of a standardized work
expense allowance
per se which we hold to be violative of
§ 402(a)(7) of the Act, but the fact that the standard used by
Colorado is, in effect, a maximum or absolute limitation upon the
recognition of such expenses. As the Court of Appeals correctly
observed, a standard allowance would be permissible, and would
substantially serve petitioners' interests in administrative
efficiency, if it provided for individualized consideration of
expenses in excess of the standard amount.
See 475 F.2d at
735.
See also Anderson v. Graham, 492 F.2d 986 (CA8 1973);
Adams v. Parham, Civ. No. 16041 (ND Ga. Apr. 14, 1972)
(unpublished); and
Campagnuolo v. White, Civ. No. 13968
(Conn.June 22 1972) (unpublished). Such a standard allowance would
comport fully with the statutory requirement that any reasonable
work expenses be considered, and would allow individualized
treatment where necessary. [
Footnote 13]
Page 416 U. S. 266
As the Court has previously observed, the AFDC program is an
area in which Congress at times "has voiced its wishes in muted
strains, and left it to the courts to discern the theme in the
cacophony of political understanding."
Rosado v. Wyman,
397 U.S. at
397 U. S. 412.
But as to reasonable expenses attributable to the earning of
income, Congress has spoken with firmness and clarity.
The judgment is affirmed.
It is so ordered.
[
Footnote 1]
Section 4313.13, vol. 4, Colorado Division of Public Welfare
Staff Manual (effective March 1970), provided in part:
"Employment expenses which are deducted from the gross amount
received by an employed recipient include, but are not restricted
to:"
"Transportation expenses:"
"Public transportation to and from work is allowed at actual
cost. When the recipient must use his own car as transportation to
and from work, 5� a mile is allowed, plus parking fees if required.
Purchase, repair, or upkeep of a vehicle, providing it is essential
to retain employment and the plan therefore is approved by the
county department."
[
Footnote 2]
Section 4313.13, vol. 4, Colorado Division of Public Welfare
Staff Manual (effective July 1970). The $30 standardized figure is
an average based upon a state-wide statistical survey of work
expenses incurred by persons in the AFDC program in Colorado. It
was calculated by examining the work expenses of every AFDC
recipient in Colorado for the last month of each quarter of the
year from March, 1969, to March, 1970. The expenses included
transportation, union dues, uniforms and tools, telephone, and
general items, but excluded the cost of child care. The state-wide
average varied from a low of $30.55 in June, 1969, to a high of
$36.93 in March, 1970.
[
Footnote 3]
According to HEW, 20 States, including Colorado, presently
employ a standard work expense allowance in combination with actual
child care expenses, and in some cases mandatory payroll
deductions, and an additional 15 States use other systems of
mandatory standard allowances for one or more major items of work
expense. Brief for United States as
Amicus Curiae 5. These
standard allowances have often been the subject of litigation. A
number have been held invalid.
See Anderson v. Graham, 492
F.2d 986 (CA8 1973) (Nebraska $25 standard work expense allowance);
Connecticut State Dept. of Pub. Welfare v. HEW, 448 F.2d
209 (CA2 1971) (Connecticut regulation limiting the types of
deductible work-related expenses);
Adams v. Parham, Civil
Action No. 16041 (ND Ga. Apr. 14, 1972) (unpublished) (Georgia $35
standard work expense allowance);
Campagnuolo v. White,
Civil Action No. 13968 (Conn.June 22, 1972) (unpublished)
(Connecticut $60 standard allowance for full-time employment
expenses and $40 standard allowance for part-time employment
expenses);
Williford v. Laupheimer, 311 F.
Supp. 720 (ED Pa.1969) (Pennsylvania $50 maximum allowance for
work expenses);
County of Alameda v.
Carleson, 5 Cal. 3d 730,
488 P.2d 953 (1971),
appeal dismissed, 406 U.S. 913 (1972)
(California work expense regulation providing for standard
deductions ranging from $6 to $25 per month). In
X v.
McCorkle, 333 F.
Supp. 1109 (N.J.1970)
modified on other grounds sub nom.
Engelman v. Amos, 404 U. S. 23
(1971), the court approved in dicta New Jersey's $50 standard work
expense allowance. In
Conover v. Hall, 104 Cal. Rptr. 77
(1972),
decision vacated pending appeal in California Supreme
Court, the court upheld California's $50 standard
allowance.
[
Footnote 4]
Colorado did not make it a state-wide practice to allow AFDC
recipients to deduct installment payments on the purchase of a car.
Consistent with the reasonableness requirement of 42 U.S.C. §
602(a)(7), such determinations were, quite correctly, made on a
case-by-case basis. As counsel for the State commented at oral
argument:
"This was an individual decision in an individual case in El
Paso County, Colorado. The same facts could have been presented to
an eligibility technician in another part of Colorado, who would
have made a decision . . . that the car was a personal expense,
that a job was available closer to the home of the recipient or
that she could use public transportation."
Tr. of Oral Arg. 33-34. Respondent correctly concedes the
State's responsibility for inquiring into whether claimed
deductions are excessive or are truly attributable to the earning
of income. Brief for Respondent 4. No doubt a State should
scrutinize with particular care claimed expenses for automobiles or
other items that, in large measure, are capital expenditures which
will also be used for personal purposes unrelated to employment.
Recognizing that States in administering AFDC programs must
determine the reasonableness of work-related expenses does not,
however, resolve the issue before us whether States may ban all
such expenses, no matter how reasonable and necessary, above a
fixed cutoff figure.
[
Footnote 5]
Another effect of the change in the State's AFDC regulation was
to terminate respondent's eligibility for participation in
Colorado's medical assistance program under Title XIX of the Social
Security Act, 42 U.S.C. § 1396a(a)(10).
[
Footnote 6]
While the case was pending in the District Court, respondent
terminated her employment and again received an AFDC grant. Prior
to the summary judgment hearing, she returned to work, again
incurring work-related expenses substantially in excess of the $30
allowance. Although respondent continued to receive a grant despite
her renewed employment, the amount was significantly lower than it
would have been if she had been permitted to deduct work expenses
in full.
[
Footnote 7]
The AFDC program was originally known as "Aid to Dependent
Children." 49 Stat. 627. In 1962, the name of the program was
changed to "Aid and Services to Needy Families with Children," and
the name of the assistance provided under the program changed to
"Aid to Families with Dependent Children." Pub.L. 87-543, 76 Stat.
185, §§ 104(a)(1) and 104(a)(2).
[
Footnote 8]
Section 3140 of the HEW Handbook of Public Assistance
Administration, Part IV (1957), thus provided in part:
"A State public assistance agency may establish a reasonable
minimum money amount to represent the combined additional cost of
three items -- food, clothing, and personal incidentals -- for all
employed persons. The State plan may provide that other items of
work expense will be allowed when there is a determination that
such expenses do, in fact, exist in the individual case."
See also Social Security Board, Bureau of Public
Assistance, State Letter No. 4 (Apr. 30, 1942); HEW, State Letter
No. 291 (Mar. 11, 1957) (indicating agency approval of such
deductions).
[
Footnote 9]
See generally 42 U.S.C. § 601; H.R.Doc. No. 81, 74th
Cong., 1st Sess. (1935); H.R.Rep. No. 615, 74th Cong., 1st Sess.
(1935); S.Rep. No. 628, 74th Cong., 1st Sess. (1935); E. Witte, The
Development of the Social Security Act 163-164 (1962).
[
Footnote 10]
Title 45 CFR § 233.20(a)(6) provides in part:
"
* * * *"
"(iv) With reference to commissions, wages, or salary, the term
'earned income' means the total amount, irrespective of personal
expenses, such as income tax deductions, lunches, and
transportation to and from work, and irrespective of expenses of
employment which are not personal, such as the cost of tools,
materials, special uniforms, or transportation to call on
customers."
"(v) With respect to self employment, the term 'earned income'
means the total profit from business enterprise, farming, etc.,
resulting from a comparison of the gross income received with the
'business expenses,'
i.e., total cost of the production of
the income. Personal expenses, such as income tax payments,
lunches, and transportation to and from work, are not classified as
business expenses."
"(vi) The definition shall exclude the following from 'earned
income:' Returns from capital investment with respect to which the
individual is not himself actively engaged, as in a business (for
example, under most circumstances, dividends and interest would be
excluded from 'earned income'); benefits (not in the nature of
wages, salary, or profit) accruing as compensation, or reward for
service, or as compensation for lack of employment. . . . "
"(vii) With regard to the degree of activity, earned income is
income produced as a result of the performance of services by a
recipient; in other words, income which the individual earns by his
own efforts, including managerial responsibilities, would be
properly classified as earned income, such as management of capital
investment in real estate. Conversely, for example, in the instance
of capital investment wherein the individual carries no specific
responsibility, such as where rental properties are in the hands of
rental agencies and the check is forwarded to the recipient, the
income would not be classified as earned income"
"(viii) Reserves accumulated from earnings are given no
different treatment than reserves accumulated from any other
sources."
[
Footnote 11]
Petitioners claim that HEW has permitted the use of standard
work expense allowances in recognition of the practical necessities
of administration, and that the Department's construction of its
own regulations is entitled to great weight.
See Red Lion
Broadcasting Co. v. FCC, 395 U. S. 367
(1969);
Udall v. Tallman, 380 U. S.
1 (1965). But the sound principle of according deference
to administrative practice normally applies only where the relevant
statutory language is unclear or susceptible of differing
interpretations.
See, e.g., Townsend v. Swank,
404 U. S. 282,
404 U. S. 286
(1971). In view of the literal requirements of § 402(a)(7), which
accord with the federal policy underlying its enactment, we need
not look to agency practice in this case. Moreover, HEW itself has
not adhered to a uniform practice. Although in recent years HEW has
construed § 402(a)(7) to permit standardization of some items, in
1964, it required that "[i]tems of work expenses must be allowed
when there is a determination that such expenses do, in fact, exist
in the individual case." HEW, Handbook of Public Assistance
Administration, Part IV, § 1340 (1964).
[
Footnote 12]
Our interpretation of § 402(a)(7) is also supported by the
disinclination of the Congress to amend the section to permit the
use of various standardized allowances.
See H.R. 16311,
91st Cong., 2d Sess., § 101 (1970); H.R. 1, 92d Cong., 1st Sess., §
401 (1971). In explaining the latter bill, which would have
replaced the present work expense provision with an increase in the
earned income disregard of § 402(a)(8)(A)(ii), the Committee on
Ways and Means observed that it "would eliminate the open-ended
work expense exclusion. . . ." H.R.Rep. No. 92-231, p. 177 (1971).
See also S. 2311 and H.R. 3153, 93d Cong., 1st Sess.
(1973).
[
Footnote 13]
The Court's observation in
Rosado v. Wyman,
397 U. S. 397,
397 U. S. 419
(1970), that
"[w]e do not, of course, hold that New York may not,
consistently with the federal statutes, consolidate items on the
basis of statistical averages"
was in no sense intended as a blanket approval of the principle
of averaging under AFDC programs without regard to what is being
averaged. In that case, the Court found a New York statute fixing
maximum AFDC allowances per family and eliminating a "special
grants" program to be in contravention of § 402(a)(23) of the Act.
In holding that New York could not completely eliminate such items
from the standard of need, the Court noted that the State could,
consistently with the statute, include them through the use of
statistical averages. A state-wide standard of need is, however,
but an estimate by state welfare officials of the minimum financial
requirements of a hypothetical family, and, by its very nature, is
susceptible of computation through the use of statistical averages.
Moreover, the discretion granted the States by Congress in
determining need,
see King v. Smith, 392 U.
S. 309,
392 U. S. 318
n. 14 (1968), contrasts sharply with the statutory requirement of §
402(a)(7) that any expenses reasonably attributable to the earnings
of income be considered. In the face of that statutory command and
the clear statement of congressional purpose, we must also reject
petitioners' claims of administrative efficiency or convenience.
See Rosado v. Wyman, supra, at
397 U. S.
417.
We also note that Colorado's use of a standard work expense
allowance is not justified by its undisputed power to set the level
of benefits under the AFDC program.
See Rosado v. Wyman, supra;
Jefferson v. Hackney, 406 U. S. 535
(1972). Although Colorado may adjust the percentage of need which
it has agreed to pay all recipients through its power to determine
AFDC funding,
see King v. Smith, supra, it may not do so
in a manner that violates a specific requirement of the Act.
See Connecticut State Dept. of Pub. Welfare v. HEW, 448
F.2d 209 (CA2 1971).