Opinion
04 Civ. 0369 (WHP).
March 21, 2005
Randal S. Jeffrey, Esq., Constance Carden, Esq. New York Legal Assistance Group, New York, NY, Attorneys for Plaintiff.
Eamonn F. Foley, Esq., Assistance Corporation Counsel, The City of New York Law Department, New York, NY, Attorneys for City Defendant.
Deborah Perleger, Esq., Assistant Attorney General New York State Office of the Attorney General, New York, NY, Attorneys for State Defendant.
MEMORANDUM AND ORDER
Plaintiffs bring this putative civil rights class action against defendant Verna Eggleston as Commissioner of the New York City Department of Social Services ("HRA" or the "City defendant") and defendant Robert Doar as Acting Commissioner of the New York State Office of Temporary and Disability Assistance ("OTDA" or the "State defendant"). Plaintiffs challenge defendants' alleged policy and practice of refusing to provide transitional food stamp benefits ("Temporary Benefits") to participants in New York City's Parks Opportunity Program (the "Opportunity Program"). Plaintiffs claim that this alleged practice violates the Food Stamp Act of 1964, 7 U.S.C. § 2020(s)(3), and its implementing regulation, 7 C.F.R. § 273.12(f)(4). Defendants move to dismiss plaintiffs' Class Action Complaint (the "Complaint") pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the following reasons, defendants' motions are denied.
HRA, the Human Resources Administration, is the local social services agency that serves New York City. (Class Action Complaint ("Compl.") ¶ 7.)
BACKGROUND
"Congress established the federally funded, State-administered food stamp program in 1964 to `safeguard the health and well-being of the Nation's population by raising levels of nutrition among low-income households.'" See Reynolds v. Giuliani, 35 F. Supp. 2d 331, 334 (S.D.N.Y. 1999) (quoting 7 U.S.C. § 2011). Section 2020 of the Food Stamp Act authorizes states to provide Temporary Benefits to households that "cease to receive cash assistance" under state family assistance initiatives. See 7 U.S.C. § 2020(s)(1). Those initiatives are partially funded through the Temporary Assistance for Needy Families ("TANF") program, 42 U.S.C. § 601 et seq. Eligible households may receive Temporary Benefits for a period of up to five months from the date their cash assistance is terminated. See 7 U.S.C. § 2020(s)(2). An eligible household receives Temporary Benefits equal to its food stamp allotment in the month prior to the termination of its cash assistance. See 7 U.S.C. § 2020(s)(3); 7 C.F.R. § 273.12(4)(i).
TANF, which replaced the federal Aid to Families With Dependent Children ("AFDC") program, provides subsistence to low-income families and was designed to "end the dependence of needy parents on government benefits by promoting job preparation, work and marriage." 42 U.S.C. § 601(a)(2).
The Food Stamp Act gives participating states the authority to designate households eligible for Temporary Benefits. See 7 U.S.C. § 2020(s)(5)(c). New York State administers the Temporary Benefits program through local social services districts. (Compl.
¶ 27.) Under New York law, recipients "leaving Family Assistance" are eligible for Temporary Benefits. (Declaration of Michael DiChiara, dated Apr. 1, 2004 ("DiCharia Decl.") Ex. A: OTDA Administrative Directive 01 ADM 16, dated Nov. 7, 2001 (the "Administrative Directive") at 2.) OTDA defines eligible households as those "whose [Family Assistance] cases are closing." (DiChiara Decl. Ex. A: Administrative Directive, at 2.) However, households with members who have violated a TANF, food stamp or Family Assistance program requirement are excluded. (DiChiara Decl. Ex. A: Administrative Directive, at 2.) Violations include failing to provide a social security number, failing to comply with a work requirement and failing to report income. (DiChiara Decl. Ex. A: Administrative Directive, at 2.)
Family Assistance is provided by New York State to low-income families with children under eighteen or pregnant women. Households receive Family Assistance through HRA. (See Compl. ¶¶ 34-35.)
The exhibits submitted by defendants on their motions may be considered because they are referenced in or are integral to the Complaint. See San Leandro Emergency Med. Group Profit Sharing Plan v. Philip Morris Cos., 75 F.3d 801, 808-09 (2d Cir. 1996) (court may consider documents partially quoted in complaint); Cortec Indus. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991) (court may consider documents "integral" to plaintiff's claim).
Plaintiffs are Family Assistance recipients selected by HRA to become temporary employees of the New York City Parks Department through the Opportunity Program. (Compl. ¶ 32.) Once Family Assistance recipients enroll in the Opportunity Program, HRA transfers their benefits to the Parks Department to subsidize their salaries. (Compl. ¶¶ 34-35.) The Complaint alleges that because OTDA limits Temporary Benefits to recipients whose Family Assistance cases are closing, HRA keeps Opportunity Program participants' files "open" in its computer system to render them ineligible for Temporary Benefits. (Compl. ¶ 37; DiChiara Decl. Ex. A: Administrative Directive, at 2; DiChiara Decl. Ex. C: HRA Policy Directive 03-31-EMP, dated June 6, 2003.)
According to the Complaint, HRA withholds cash assistance benefits for Opportunity Program participants such as plaintiffs because of their hourly earnings from the Parks Department. (Compl. ¶¶ 32, 35-36; Transcript of Oral Argument on Defendants' Motions to Dismiss, dated May 7, 2004 ("Tr."), at 14.) Plaintiffs further allege that Opportunity Program participants experience substantial reductions in their food stamp benefits, often receiving less than half of their previous monthly food stamp allotments. (Compl. ¶ 39.) For example, Plaintiff Tanya Walker's public assistance grant dropped from $468.50 per month to $0, and her monthly food stamp benefits fell from $256 to $94. (Compl. ¶¶ 43-45.) Plaintiffs assert that Walker should have continued to receive the equivalent of $256 per month in Temporary Benefits while she was in the Opportunity Program. (Compl. ¶ 46.)
According to the Complaint, the City and State defendants are required to provide Temporary Benefits to all eligible households that cease receiving cash assistance from the Family Assistance program because of job income. (Compl. ¶ 41.) However, plaintiffs claim that defendants have a policy of refusing to provide Temporary Benefits to Opportunity Program participants in violation of Section 2020(s)(3) of the Food Stamp Act. (Compl. ¶ 41.) Plaintiffs assert that Opportunity Program participants should receive Temporary Benefits equal to the amount of food stamp benefits they received during the month before entry into the program. (Compl. ¶ 40.)
DISCUSSION
I. Motion to Dismiss Standard
On a motion to dismiss, a court must accept the material facts alleged in the complaint as true and construe all reasonable inferences in a plaintiff's favor. Grandon v. Merrill Lynch Co., 147 F.3d 184, 188 (2d Cir. 1998). A court should not dismiss a complaint for failure to state a claim unless "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief."Conley v. Gibson, 355 U.S. 41, 45-46 (1957). In this limited task, the "issue is not whether plaintiff will or might ultimately prevail on her claim, but whether plaintiff is entitled to offer evidence in support of allegations in the complaint." Hamilton Chapter of Alpha Delta Phi, Inc. v. Hamilton Coll., 128 F.3d 59, 62 (2d Cir. 1997).
II. Private Right of Action Under Section 2020(s)(3)
As a threshold issue, the City defendant argues that the Complaint must be dismissed because Section 2020(s)(3) does not create a privately enforceable right of action under Section 1983. This contention is unavailing.
Section 1983 imposes liability on anyone who, under color of state law, deprives a person "of any rights, privileges, or immunities secured by the Constitution and laws" of the United States. 42 U.S.C. § 1983. For a claim under Section 1983, a plaintiff "must assert the violation of a federal right, not merely the violation of a federal law." Blessing v. Freestone, 520 U.S. 329, 340 (1997) (emphasis in original). To determine whether a federal statute creates a privately enforceable right, courts must consider three factors: (1) "Congress must have intended that the provision in question benefit the plaintiff'; (2) "the plaintiff must demonstrate that the right assertedly protected by the statute is not so `vague and amorphous' that its enforcement would strain judicial competence"; and (3) "the statute must unambiguously impose a binding obligation on the States." Blessing, 520 U.S. at 340-41. Further, as clarified in Gonzaga University v. Doe, a federal right must be "unambiguously conferred" to support a claim under Section 1983. 536 U.S. 273, 283 (2002). Thus, the statute must speak in terms of "rights," not "the broader or vaguer `benefits' or `interests,' that may be enforced under the authority of that section." Gonzaga Univ., 536 U.S. at 283. The test is whether "the statutory language `unambiguously confers an enforceable right' upon an identifiable class of beneficiaries." Taylor v. Vermont Dep't of Educ., 313 F.3d 768, 783 (2d Cir. 2002).
Section 2020(s)(3) provides, in pertinent part, that "[d]uring the transitional benefits period . . . a household shall receive an amount of food stamp benefits equal to the allotment received in the month immediately preceding the date on which cash assistance was terminated, adjusted for the change in household income as a result of . . . the termination of cash assistance." 7 U.S.C. § 2020(s)(3). As a matter of law, this provision satisfies the first Blessing factor because it is clearly focused on eligible households and their right to receive Temporary Benefits. See Gonzaga Univ., 536 U.S. at 284 ("For a statute to create such private rights, its text must be `phrased in terms of the persons benefited.'"); see also Touche Ross Co. v. Redington, 442 U.S. 560, 576 (1979) (stating that rights-creating statutes must be phrased with an emphasis on the benefited class); Cannon v. Univ. of Chicago, 441 U.S. 677, 692 n. 13 (1979) (same); cf. Alexander v. Sandoval, 532 U.S. 275, 289 (2001) ("Statutes that focus on the person regulated rather than the individuals protected create `no implication of an intent to confer rights on a particular class of persons.'"). This holding comports with other decisions that have inferred private rights of action from similar statutes.See Gonzales v. Pingree, 821 F.2d 1526, 1528 (11th Cir. 1987); Victorian v. Miller, 813 F.2d 718 (5th Cir. 1987);Reynolds, 35 F. Supp. 2d at 341.
The Court of Appeals recently held that an analogous provision of the Medicaid Act creates a private right of action under Section 1983 because of its unambiguous focus on the benefited class. See Rabin v. Coker-Wilson, 362 F.3d 190, 201 (2d Cir. 2004). In Rabin, the Second Circuit reviewed Section 1396r-6 of the Medicaid Act, 42 U.S.C. § 1396r-6, which provides that "each State plan approved under this subchapter must provide that each family which was receiving [AFDC] in at least 3 of the 6 months immediately preceding the month in which such family becomes ineligible for such aid . . . remain eligible for assistance under the plan." See 362 F.3d at 201. The Second Circuit determined that Section 1396r-6 creates a privately enforceable right because it clearly reflects Congress' intent to confer a right to transitional medical assistance on eligible recipients. Rabin, 362 F.3d at 201.
Section 2020(s)(3) focuses directly on its intended beneficiaries, i.e., households eligible for Temporary Benefits. While Section 1396r-6 deals largely with the requirements of state assistance plans, Section 2020(s)(3) telescopes on recipients eligible for Temporary Benefits. This Court concludes that Section 2020(s)(3)'s unambiguous emphasis on households eligible for Temporary Benefits signifies Congress' intent to create a privately enforceable right. See Rabin, 362 F.3d at 201 ("Because all of the language of Section 1396r-6 . . . reflects Congress's intention to confer a right to [transitional medical assistance] upon persons who meet the various eligibility requirements, we find that Section 1396r-6 can support a Section 1983 claim.").
Moreover, Section 2020(s)(3) is neither vague nor amorphous and its private enforcement will not strain judicial competence. Section 2020(s)(3) specifically establishes a formula for allocating Temporary Benefits to eligible households. Thus, it can be manageably enforced. See Wright v. Roanoke Redev. Hous. Auth., 479 U.S. 418, 431-32 (1987) (finding provision allowing for "reasonable" utilities allowance to public housing tenants "sufficiently specific and definite to qualify as [an] enforceable right"); see also Reynolds v. Giuliani, No. 98 Civ. 8877 (WHP), 2005 WL 342106, at *15-16 (S.D.N.Y. Feb. 14, 2005); Greenstein by Horowitz v. Bane, 833 F. Supp. 1054, 1067 (S.D.N.Y. 1993) (section of Medicaid Act providing for corrective payments according to specific formula not too vague or amorphous for judicial enforcement).
Finally, Section 2020(s)(3) imposes a binding obligation on states by mandating that eligible households "shall" receive Temporary Benefits. See Marisol A. by Forbes v. Giuliani, 929 F. Supp. 662, 682-83 (S.D.N.Y. 1996) (statute outlining foster care protections that states "must" offer is mandatory and thus creates binding obligation on states); see also Bryson v. Shumway, 308 F.3d 79, 89 (1st Cir. 2002) (holding that provision of Medicaid Act, which mandates that state plans "must" provide medical assistance, imposes binding obligation on states). "These are not mere guidelines but, rather, requirements which states must meet." Reynolds, 2005 WL 342106, at *16 (quoting Bryson v. Shumway, 308 F.3d 79, 89 (1st Cir. 2002)).
The City defendant nevertheless contends that because states have the option of participating in the Temporary Benefits program, those benefits are not an entitlement that plaintiffs can enforce. That argument lacks merit because once a state opts to participate in the Temporary Benefits program, it is obligated to provide those benefits to eligible households. The implementing regulations to the Food Stamp Act state unequivocally that "[a] State agency electing . . . [Temporary Benefits] must provide transitional benefits, at a minimum, to all families with earnings who leave TANF." 7 C.F.R. § 273.12(f)(4) (emphasis added).
The City defendant maintains, additionally, that because the Food Stamp Act contains a provision allowing the Secretary of Agriculture to withdraw funding from states for non-compliance, 7 U.S.C. § 2020(g), only the Secretary can enforce the states' obligations. That argument is unpersuasive because the Second Circuit has found private rights of action where a statute contains a funding withdrawal provision. See Rabin, 362 F.3d at 200-01. Additionally, the legislative history of the Food Stamp Act indicates that Congress intended to allow for private rights of action under that statute. See H.R. Rep. No. 464, 95th Cong., 1st Sess. 398 ("Administrative remedies against the state contained in section 11(f) and elsewhere should not be construed as abrogating in any way private causes of action against states for failure to comply with federal . . . requirements.").
Section 2020(s)(3) thus satisfies the Blessing criteria. The City defendant's motion to dismiss on the basis that Section 2020(s)(3) does not create a private right of action is denied.
III. Plaintiffs' Eligibility for Temporary Benefits
Alternatively, defendants assert that plaintiffs lack standing to assert a private right of action under Section 2020(s)(3). Defendants argue that Opportunity Program participants are not eligible for Temporary Benefits because they continue to receive "cash assistance under a State program" through HRA's subsidization of their Parks Department wages. Defendants also maintain that because Opportunity Program participants' public assistance cases remain open, they are not "leaving Family Assistance" and therefore are ineligible for Temporary Benefits. These arguments are without merit.
A. Eligibility for Temporary Benefits Under Federal Law
The Opportunity Program is a grant diversion program, which is "a form of wage subsidy." (Compl. ¶ 34; DiChiara Decl. Ex. C: HRA Policy Directive # 03-31-EMP, at 1.) Family Assistance and food stamp benefits are rebudgeted when individuals join the Opportunity Program. They cease receiving cash assistance because of their hourly salaries. (Compl. ¶ 35; DiChiara Decl. Ex. C: HRA Policy Directive # 03-31-EMP, at 3 ("[C]ash may not be issued while [an Opportunity Program participant] is receiving a paycheck.").) Because Opportunity Program participants no longer receive "cash assistance under a State program" funded in part through TANF, they become eligible for Temporary Benefits. See 7 U.S.C. § 2020(s)(1) ("A State agency may provide transitional food stamp benefits to a household that ceases to receive cash assistance under a State program.").
While plaintiffs' hourly salaries of $7.50 are partially subsidized by HRA, those wages do not qualify as "assistance" within the meaning of the Food Stamp Act. The implementing regulations to the Food Stamp Act define "assistance" as "cash, payments, vouchers, and other forms of benefits designed to meet a family's ongoing basic needs." 45 C.F.R. § 260.31(a)(1). The Food Stamp Act specifically excludes from this definition of assistance "[w]ork subsidies (i.e., payments to employers or third parties to help cover the costs of employee wages, benefits, supervision, and training)." 45 C.F.R. § 260.31(b)(2). Thus, Opportunity Program participants, such as plaintiffs, do not receive "cash assistance" as that term is defined under the Food Stamp Act and are eligible for Temporary Benefits.
The State defendant has not met its burden of showing that 7 C.F.R. § 271.2 is the applicable regulation defining "assistance." See Sweet v. Sheahan, 235 F.3d 80, 83 (2d Cir. 2000). The parameters of the TANF program including "assistance," are set forth in 45 C.F.R. § 260.31(a)(1). Accordingly, that is the regulation on which this Court relies.
B. Eligibility for Temporary Benefits Under New York Law
Plaintiffs also fulfill the eligibility criteria for Temporary Benefits under New York law. OTDA's Administrative Directive restricts Temporary Benefits to "recipients leaving [Family Assistance]," i.e., those "whose [Family Assistance] cases are closing." (DiChiara Decl. Ex. A: Administrative Directive, at 2.) "In interpreting the terms of a statute, [courts] look first to the language of the statute itself." Mallard v. United States Dist. Court, 490 U.S. 296, 300 (1989); see Auburn Hous. Auth. v. Martinez, 277 F.3d 138, 143 (2d Cir. 2002). The language of OTDA's Administrative Directive — "leaving" and "closing" — is framed clearly in the present tense and, therefore, does not automatically limit Temporary Benefits to recipients whose cases have already closed. See United States v. Wilson, 503 U.S. 329, 333 (1992) (stating that verb tense is a significant factor to be considered in statutory construction); see also generally William N. Eskridge, Jr. Philip P. Frickey, Cases and Materials on Legislation: Statutes and the Creation of Public Policy 643-52 (2d ed. 1995). The Administrative Directive does not contain a definitional section and nowhere states that "recipients leaving family assistance" are recipients whose cases already are "closed." Therefore, the Administrative Directive does not, as the State defendant maintains, designate households with open public assistance cases as ineligible for Temporary Benefits. Rather, eligibility is limited to those who have ceased to receive assistance regardless of whether their cases are open or closed.
Additionally, because Opportunity Program participants no longer receive cash assistance, they have left TANF and Family Assistance. The parties agree that the "leave TANF" language of 7 C.F.R. § 273.12(f)(4) has the same meaning as the "cease to receive cash assistance" language of Section 2020(s)(1). (Plaintiffs' Memorandum of Law in Opposition to Defendants' Motions to Dismiss at 12; Tr. at 11); see also Sec'y of Labor, Mine Safety Health Admin. v. Western Fuels-Utah, Inc., 900 F.2d 318, 320 (D.C. Cir. 1990) (implementing regulations are to be interpreted in accord with underlying statutes). As discussed above, Opportunity Program participants do not receive cash assistance because they no longer get cash grants and their Parks Department wage subsidies are excluded from the definition of "assistance" under the Food Stamp Act. Therefore, because Opportunity Program participants have "cease[d] to receive cash assistance" within the meaning of Section 2020(s)(1) and 7 C.F.R. § 273.12(f)(4), they have left TANF and Family Assistance.
Moreover, a 2001 Senate Report discussing 7 C.F.R. § 273.12(f)(4) interprets "leaving TANF" as leaving cash assistance. See S. Rep. No. 117, 107th Cong., 1st Sess. 60 (2001) (under section 273.12(f)(4), "States [have] the option to continue food stamps for three months to families leaving cash assistance.").
Opportunity Program participants therefore fall within OTDA's definition of those eligible for Temporary Benefits since they have left TANF. Because Opportunity Program participants satisfy OTDA's eligibility for Temporary Benefits — and do not fall into any of the exclusions — plaintiffs have stated a claim for which relief may be granted under Section 2020(s)(3) of the Food Stamp Act and 7 C.F.R. § 273.12(f)(4). Defendants' motions to dismiss are, therefore, denied.
CONCLUSION
For the foregoing reasons, defendants' motions to dismiss the Complaint are denied.
SO ORDERED.