The following general rules are applicable.
Value of
resources must be established by objective measurement. In some instances,
it is possible for a piece of property to have no market value if
it can be established that the property cannot be sold for any price.
A statement that the property is not saleable due to a specific condition
from one or more knowledgeable sources (i.e., bankers, realtors, etc.)
in the applicable geographic area could be used for this purpose.
Such condition should be reviewed at each redetermination to ascertain
if there have been any changes and to adjust the value, if appropriate.
It is also possible that a client may own a marketable piece of property
with no equity value such as when encumbrances exceed the market value.
In either instance, the property shall be deemed to have no value.
Resources
must be available. Resources are considered available when an applicant/recipient
has a legal interest therein and the legal ability to make them available.
A resource shall be considered
unavailable when there is a legal impediment that precludes the
disposal of the resource. A legal impediment is a barrier to a
person’s ability to use or enforce some rights in property or
at law. Property is considered unavailable due to legal impediment
if the individual does not have the legal right to access property
and the property cannot be sold on the open market or, for non-cash
property, converted to cash. The refusal or failure of an individual
to take actions to make property available, if within the individual’s
legal rights to do so, does not constitute a legal impediment.
For food assistance, also see 5200(6)(c).
An example of a legal impediment may include property
held pending final action by a court, such as in a divorce preceding
or boundary dispute as the individual does not have access to
such assets. However, the refusal of a joint owner to sell property
does not constitute a legal impediment, as the remaining owner
has the right to sell their share. The existence of a lien is
not considered a legal impediment, but rather an encumbrance against
the property thereby reducing the countable value.
For a legal impediment to exist, the following are required:
Verification of the impediment.
The impediment must be documented through copies of deeds,
titles, wills, court orders, etc. in order to verify the status
of the property. A detailed, written explanation of the situation
may also be provided as evidence to support the alleged impediment.
A reasonable attempt to
overcome the impediment. Prior to establishing a legal impediment,
the individual must demonstrate that reasonable steps have
been taken to overcome the impediment. If such attempts have
been made and verified and a resolution does not appear to
be immediate, the property is considered unavailable. However,
the individual must continue to pursue reasonable steps to
overcome the impediment. Such actions must be scheduled and
routine, with the frequency and nature dependent upon the
situation. If it is determined the cost of overcoming the
impediment would exceed the gain to the individual, the property
is considered unavailable. However, should changes occur which
might change the outcome, or result in the availability of
the property, it may become necessary for the individual to
again attempt to overcome the impediment. As applicants and
recipients are required to cooperate and pursue potential
resources , failure to do so may result in negative action
as per KEESM 2124 (not applicable
to food assistance).
For all programs, if the individual
owns excess nonexempt real property and such property is available,
assistance shall be provided if the individual is making a bona
fide and documented effort to dispose of the property. Evidence
of a bona fide effort could include a current listing with a real
estate company, statement from a realtor that the client is actively
showing the property, for sale sign on property, and ads in the
newspaper. The initial asking price should be consistent with
the fair market value of the property and shall be regularly adjusted.
Reasonable offers for the property should be accepted. Bona-fide
effort activities should be reviewed on a semiannual basis.
For MS, QMB, LMB, and QWD, nonexempt real property
shall not be considered available for so long as it cannot be
sold because the property is jointly owned and its sale would
cause undue hardship due to loss of housing for the other owner(s).
Documentation is required that the other owner(s) is using the
property as a home. Once loss of housing is no longer at issue,
the property shall be considered as an available resource.
(Food Assistance Only) A resource
shall also be identified as unavailable if its sale or other disposition
is unlikely to produce any significant amount of funds for the
support of the household. For the purposes of this provision,
if the household's equity in the resource is less than half of
the applicable resource limit ($1,125 or $1,625), then the sale
or other disposition is unlikely to produce any significant amount
of funds for the support of the household and the resource shall
be exempt. Documentation is required for a resource to be excluded
under this provision.
Also to be
excluded as unavailable resources are non-liquid assets against which
a lien has been placed as a result of taking out a business loan and
which the household is prohibited by the security or lien holder (creditor)
from selling. Examples of such non-liquid assets could be land, crops,
buildings, farm equipment, or machinery.
Ownership
of excess nonexempt personal property shall result in ineligibility.
For MS, Working Healthy,QMB,
LMB, and QWD, if an individual owns excess nonexempt personal
property and such property is available, assistance shall be provided
for a period of up to 9 months if the individual is making a bona
fide and documented effort to dispose of the property. Evidence
of a bona fide effort could include ads in newspapers, a sales
price consistent with the fair market value of property, and use
of a for sale sign.
If the property is not sold within the specified time period, the
assistance unit is ineligible. However, assistance provided during
the disposal period shall not be considered an overpayment and
is not subject to recovery.
When there has been no documented attempt to dispose
of the property in a month (including prior medical eligibility),
such property shall be viewed a being actually available. Liquid
cash assets are to be considered as available to meet current
needs and, thus, are not subject to the bona fide effort provisions,
except as noted in item (b) below.
For MS, Working Healthy, QMB, LMB and QWD, liquid
resources which have been converted to an exempt burial fund or
plan, or resources which have been liquidated and the funds used
to purchase an exempt burial fund or plan, are considered unavailable
beginning on the date the request to liquidate or convert was
made with the appropriate company holding the resource. The process
must be initiated within 15 days of the date of the application
(for applicants) or report of excess resources. The process must
also be completed and documented within 90 days of this date.
Assistance can not be provided while the conversion process is
pending but is to be approved or reinstated retroactively when
the conversion has been fully completed and documentation of the
burial plan has been provided.
For all programs, resources
shall also be considered unavailable to persons in shelters for
battered persons and children if: (1) the resources are jointly
owned by the shelter resident and members of the former home;
and (2) the shelter resident's access to the value of the resource
is dependent on the agreement of a joint owner who still resides
in the former home.
Ownership of property is determined by legal title. In absence of legal title, ownership shall be determined by possession. Note special provisions related to SSI in item (11) and to HCBS arrangements in item (9), (10) and (11).
Joint
Ownership - The pro rata equity value of jointly owned
real property and the full equity value of jointly owned personal
property shall be considered in the determination of eligibility
except as noted in item (b) below for medical, and (c) for food
assistance.
For a resource held jointly with an individual who is not a member
of the household or assistance plan, the resource may be excluded
from consideration if all of the following conditions are met:
The individual can demonstrate
the household/assistance plan member has no ownership interest
in the resource;
The household/assistance
plan member has not contributed to the resource; and
Any access to the resource
is limited as acting as an agent for the other owner.
Specified
Interest in Real Property (Medical Only) - If a specific
and discrete property interest less than 100% is designated for
real property, the full value is considered in the determination
of eligibility.
Example: Mr. R, a Medicaid applicant, presents a deed
listing him as 75% owner of a parcel of real property. Mr. X owns
the remaining 25%. Because the Medicaid applicant owns a specified
interest in the property, the entire equity value of the property
is attributable to Mr. R. In contrast, if Mr. R and Mr X have
a standard joint tenancy deed, the pro rata share is attributable
to Mr. R.
Where a specified interest is designated, the full value of property
is considered regardless of other exemptions, including income
producing property and property used as a home.
Joint
Owner Who Refuses to Comply (Food Assistance only) -
A resource shall be totally inaccessible to the household if the
resource cannot be practically subdivided and the household's
access to the value of the resource is dependent on the agreement
of a joint owner who refuses to comply.
The resource
value of property shall be the client's equity in the property. Equity
is defined as fair market value less encumbrances.
For medical, outstanding checks are treated as encumbrances against
a checking or savings account and the value of the account is to be
reduced by checks which have not been cashed or cleared the bank beginning
in the month the funds were originally committed (i.e., the date the
check was written and received). Documentation of the payment amount
and date is required.
Resources
of all persons whose needs are included in the assistance plan must
be considered. For TANF, eligibility must be determined as though
the unborn child was born and living. Thus, the resources of the father
of the unborn child, if present, must be considered. For food assistance,
the nonexempt resources of excluded and disqualified members count
in their entirety to the remaining household members. The nonexempt
resources of nonhousehold members are NOT considered in determining
eligibility.
The total
resources of both spouses shall be considered in determining the eligibility
of either or both for assistance for if they are living together (including
physical separation while maintaining a common life). This provision
is not applicable for medical assistance when one or both spouses
enter an institutional or HCBS arrangement. (See 8141
and 8142 (1) for institutional arrangements
and 8241 and 8242
(1) for HCBS arrangements.) For TANF and food assistance, this
provision would also not be applicable when one or both spouses enter
an institutional arrangement but would be applicable to HCBS arrangements
if the care is being provided in the home and the couple continues
to live together.
If a parent enters an institutional living arrangement
(whether or not the facility is Medicaid approved) for other than
a planned brief stay as defined in 8113
or begins to receive HCBS, his or her resources shall be considered
in determining the eligibility of a minor child only for the month
the arrangement begins. Thereafter, only those resources in which
the minor child has ownership interest shall be considered in determining
the eligibility of that child. However, for TANF and food assistance,
if the parent receives HCBS services in the home and continues to
live with the child, that parent's resources must still be considered.
The resources
owned solely by an SSI recipient (including a spouse or parent) are
excluded from consideration except when the provisions of 8141
and 8142 (1) for institutional arrangements
and 8241 and 8242
(1) for HCBS arrangements are applicable. For food assistance,
resources owned jointly with an SSI recipient are exempt, but considered
available to the client for all other programs.
A resource
shall not be considered as property and as income in the same month.
For instances when income received in a month is deposited into a
checking or savings account, the value of such account for that month
shall be determined by subtracting the total amount of income deposited
from the lowest balance of the account. This is not applicable to
spousal impoverishment assessments in which the highest value of the
account in a month would be used.
Also see item (7) for establishing the value of a checking or savings account.