1. FAP Divestment BEM 406

2. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Main Menu (hyperlinked) 2  Divestment Calculation Divestment Calculation  Recording Asset Transfer Recording Asset Transfer  Recoupment Recoupment  Verification Requirements Verification Requirements  FAP Divestment Policy FAP Divestment Policy  Divestment Determination Divestment Determination  Documenting the Case Documenting the Case  Definitions Definitions  Correcting a Disqualification Period Correcting a Disqualification Period  Discovering Divestment Discovering Divestment  Completing the Asset Transfer Page Completing the Asset Transfer Page  Example: Penalty Applied Example: Penalty Applied  Resources Resources

3. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Learning Objectives This presentation provides:  Description of FAP Divestment  Calculation for determining if Divestment has occurred  Disqualification period table to show length of Penalty  Definitions of Key Terms  Procedures to follow  Resources to provide additional training and instructions 3

4. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 FAP Divestment Policy Divestment means the transfer of assets for less than fair market value for any of the following reasons: To qualify for program benefits To remain eligible for program benefits 4

5. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Definitions Fair Market Value: The amount of money the owner would receive in the local area for his asset … if the asset … was sold on short notice… (see BPG for complete definition). 5

6. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Discovering Divestment BEM 406 You do not hunt for divestment... Divestment has not occurred when any of the following apply: The individual did not transfer assets for less than fair market value for any of the above definitions of divestment. The individual converted the asset to another asset of equal value. The asset sold or given away was excluded in policy; see Bridges Eligibility Manual (BEM) 400. You become aware of divestment in the course of doing your regular case work.  6

7. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Divestment Determination EXAMPLE 1:  Client turns in a bank statement.  Worker notices large withdrawal.  Worker should ask/document how money was spent.  Client says they gave the money to their brother (not a member of the group). EXAMPLE 2:  FAP Group had two cars and they then exceed the asset limit.  The FAP case closed.  Group reapplies and declares one of the vehicles is still owned the other was given away to a friend (which occurred in the last 3 months). In the course of doing case work, a specialist will become aware of an Asset Transfer. For example:Asset Transfer In the course of doing case work, a specialist will become aware of an Asset Transfer. For example:Asset Transfer 7

8. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Is There a Divestment Penalty? In order for there to be a Divestment Penalty, the situation must satisfy the Divestment Calculation: Value of Divested Asset + Other Countable Assets = Total Countable FAP Assets Total Countable FAP Assets - FAP Asset Limit = Calculated Amount Divested $3,500Value of Divested Asset (gave away 2 nd car within 3 mos of app) + $2,200Other Countable FAP Assets (bank accounts at application) $5,700Total Countable FAP Assets - 5,000FAP Asset Limit $ 700Calculated Divestment Amount Only when the result of the calculation is GREATER THAN ZERO will the group would get a Divestment Penalty (next slide).Divestment Penalty Only when the result of the calculation is GREATER THAN ZERO will the group would get a Divestment Penalty (next slide).Divestment Penalty 8

9. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 *click* Disqualification Period Table Calculated Amount in Excess of FAP Asset Limit Disqualification Period $.01 – 249.991 Month 250 – 999.993 Months 1,000 – 2,999.996 Months 3,0000 – 4,999.999 Months 5,000 or more12 Months During the Disqualification Period:  The FAP group is disqualified and the case is closed for the divested period.  Adults age 18 and over remain disqualified during the entire divestment period, even if they become a member of another FAP group.  Children in the disqualified group can regain eligibility if they leave the FAP group. In the situation on the previous slide, the group would be Disqualified for 3 Months due to the $700 divestment. 9

10. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Example: No Penalty In order for there to be a Divestment Penalty, the situation must satisfy the Divestment Calculation: $3,500Divested Amount + $1,150Other Countable FAP Assets $4,650Total Countable FAP Assets - $5,000FAP Asset Limit - $ 350No Divestment Penalty See additional examples and situations in BEM 406.... if there is no amount leftover (or negative), the group would not be disqualified. After subtracting the FAP Asset Limit... 10

11. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Disqualified Group Members Start the disqualification period with the month of application if it is verified the divestment occurred before the FAP EDG is certified. Send timely notice of negative action if the FAP group is participating when the divestment is discovered. The DHS-1605 will explain the reason for and length of the disqualification period. The disqualification will be effective the first month after the negative action date. Note: If case is being reinstated, but the client will still be denied due to divestment, the specialist will need to send the client a DHS-176, Benefit Notice, to inform them of the divestment and the disqualification period. BEM 406 FAP Divestment 11 The DHS-176 must be manually generated from the Forms Library.

12. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Recoupment Disqualification periods are always in the future, not retroactive, so recoupment is not necessary. 12

13. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Correcting a Disqualification Period Disqualification periods are served forward and not retroactive therefore, recoupment is not necessary. When it is discovered an incorrect disqualification period is established, a policy exception override request is needed; see BEM 100. The exception staff will adjust the disqualification period. Send the client a DHS-176, Benefit Notice, informing them of the change in the disqualification period. BEM 406 FAP Divestment: 13 The DHS-176 must be manually generated from the Forms Library.

14. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Documenting the Case Document the following in case comments and page-level comments (as appropriate): The divestment determination. The date and method of verification. Verification sources. Document the following in case comments and page-level comments (as appropriate): The divestment determination. The date and method of verification. Verification sources. *** Clear case documentation is always essential.*** 14

15. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Recording an Asset Transfer  The question, “Was Asset Transferred?” appears on each Asset – Details page. o If answered YES, the Asset - Transfer page is added to the driver flow. o Indicate that an asset was transferred unless it was transferred to another member of the FAP group.  To record a transfer, you must answer YES to the transfer question and complete the Asset Transfer – Details page.  Bridges will determine whether or not FAP Divestment has occurred based on information entered by the specialist. 15

16. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Use the Asset Transfer – Details Page Field Reference Guide found on the Training website for help completing this page.Asset Transfer – Details Page Field Reference Guide Use the Asset Transfer – Details Page Field Reference Guide found on the Training website for help completing this page.Asset Transfer – Details Page Field Reference Guide IMPORTANT NOTE: Once an asset is marked as Transferred, Bridges no longer counts that asset when determining the FAP groups’ countable assets.. Asset – Transfer Page Completing the Asset Transfer Page 16

17. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Recording an Asset Transfer  The worker indicates an asset has been transferred and completes the Asset Transfer Page in Bridges.  The penalty period can be viewed in the Wrap-up Section of Data Collection under FAP Divestment.  If FAP Divestment has occurred, Bridges calculates a penalty period and applies the penalty based on the information entered by the specialist. 17  Bridges applies Policy to determine if a transfer is Divestment.

18. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Verification Requirements Verification of divestment is not required when the client states he/she has not transferred assets unless either: The client's statement is unclear, inconsistent or conflicts with known facts. Existing information in the case record indicates divestment might have occurred. Verify the transfer and the reason for the transfer when the client states a transfer has been made. Sources to verify transfers and reasons for them include, but are not limited to, the following: Legal documents. Payment or tax records. Bills of sale. Court or attorney records. Correspondence regarding the transaction. Bank/credit union statements. Sources to verify transfers and reasons for them include, but are not limited to, the following: Legal documents. Payment or tax records. Bills of sale. Court or attorney records. Correspondence regarding the transaction. Bank/credit union statements. 18

19. FAP Divestment Last Slide Viewed Main Menu End Show December 2013 Resources Training Website: Asset Transfer Page Field Reference Guide (FRG) Assets – Common Procedures CBT Joint Ownership Field Reference Guide (FRG) BEM 212Food Assistance Program Group Composition BEM 400Assets BEM 406FAP Divestment BEM 550FAP Income Budgeting BEM 554FAP Allowable Expenses and Expense Budgeting 19

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