Cross-appeals from an order of the United States District Court for the Southern District of New York, Conner, J., holding that federal regulations do not require either timely notice or continued benefits pending a hearing before certain publicly provided day care services are terminated. Affirmed.
KAUFMAN, Chief Judge, LUMBARD and MULLIGAN, Circuit Judges.
This appeal by Cologara Mahoney, representing herself, her infant daughter and all other persons who are eligible for day care services while "seeking employment" pursuant to the New York State Code of Regulations, 18 N.Y.C.R.R. § 394.2(a)(3), raises the question whether timely notice and a hearing are necessary under federal regulations before certain publicly provided day care services may be terminated. The appellees and cross-appellants, Commissioners of the New York State Department of Social Services and the New York City Human Resources Administration and Agency for Child Development, question whether they are required to offer reinstatement of services following a termination and a request for a hearing. We find that while appellees are not required to provide recipients with timely notice or to continue services uninterrupted pending a decision after a hearing, the federal regulations do provide for reinstatement of services where a recipient requests a hearing within ten days of notice of termination and raises issues not involving solely the application of state or federal law or policy.*fn1 Accordingly, we affirm the order of the district court.
Mahoney and four other named plaintiffs brought this class action in the Southern District of New York in May 1976 charging that the New York State Department of Social Services day care eligibility regulation which terminates public day care services to a recipient after 120 days of seeking employment violates the federal fair hearing regulations and constitutional due process which require adequate notice of the proposed termination of services and the continuation of benefits pending a hearing decision. Only the statutory claim is before us on this appeal.*fn2
The State Department of Social Services and the Agency for Child Development (ACD) provide publicly funded day care services in New York City. Seventy-five percent of the cost of these services is funded by the federal government under Title XX of the Social Security Act, 42 U.S.C. § 1397 et seq. As a condition for federal assistance, the state must establish eligibility requirements designed to promote enumerated federal goals. These goals include achieving or maintaining self-support and self-sufficiency, preventing neglect and reducing inappropriate institutional care. 42 U.S.C. § 1397. The New York State requirements are set forth in N.Y.C.R.R.§ 394 and among them is the "seeking employment" criterion which provides that day care services are available where (parents) or caretaker relatives are actively seeking employment. Initial authorization shall not exceed sixty consecutive days and subsequent authorization, not to exceed an additional sixty days, may be issued after a redetermination of eligibility and referral to a local district's employment service program. Day care services are to end after 120 days if no employment or other change in family circumstances has occurred.
When eligibility ends, a notice of intent to discontinue services is sent to the recipients of services advising them of their right to request an administrative hearing. Notice of the circumstances under which services may be continued pending a hearing is not provided.
Appellant questions whether the New York procedures comply with federal regulations promulgated by the United States Department of Health, Education and Welfare (HEW) in an effort to further efficient administration of the Social Security Act. See 42 U.S.C. § 1302 (1970). One such regulation, 45 C.F.R. § 205.10, made applicable to Title XX services by 45 C.F.R. § 228.14, requires both adequate and timely notice prior to termination of assistance in addition to continued assistance pending a determination where a hearing is requested. Timely means at least ten days prior to termination and adequate means a written notice including the action to be taken, the reason therefor, an explanation of the individual's right to request a hearing and the circumstances under which assistance is to be continued if a hearing is requested.45 C.F.R. § 205.10(a)(4). Nine circumstances are set forth where only adequate notice is required, not later than the date of the action. In these situations, although assistance need not be continued pending a decision after a hearing, 45 C.F.R. § 205.10a(7) provides for reinstatement of services if a recipient requests a hearing within ten days after notice is mailed advising of termination. One of the nine circumstances is the situation where
"a special allowance granted for a specific period is terminated and the recipient has been informed in writing at the time of initiation that the allowance shall automatically terminate at the end of the specified period." 45 C.F.R. § 205.10(a)(4)(ii)(I).
Appellant received notice in March 1976 that her day care services would be terminated. She requested and received a hearing but the determination of the ACD was upheld. Three of the plaintiffs who originally joined her in this action also received termination notices and requested hearings. Two were restored to day care services while the third had a change in personal circumstances which made further services unnecessary. Mahoney remains the sole named plaintiff-appellant herein.*fn3
Mahoney's motion for partial summary judgment and defendants' cross-motion for summary judgment occasioned Judge Conner to issue three separate opinions. He initially found that New York's policy of terminating day care services prior to a hearing violated the federal regulations in that neither timely notice nor a pre-termination hearing were afforded. Voelker v. Whaley, 76 Civ. 2418 (February 2, 1977). He adhered to this position and denied a motion to reargue on May 24, 1977. Voelker v. Frankfort. However, following a motion for a stay, Judge Conner reconsidered these decisions and determined they were incorrect. Voelker v. Frankfort (June 30, 1977). He then concluded that New York's "seeking employment" eligibility requirement is a special allowance within the meaning of 45 C.F.R. § 205.10(a)(4)(ii)(I) and, accordingly, neither timely notice nor continued benefits are required pending a hearing. Although his opinion was silent on this point, his partial summary judgment of July 13, 1977 directed defendants to amend their termination notices to advise recipients that upon timely request for a hearing services would be reinstated and continued until a decision is rendered. It is this order from which the present appeals are taken.
Cross-appellants have on this appeal belatedly challenged the validity of the federal regulations that require either a continuation or a reinstatement of services where a hearing is requested by a day care recipient who has received notice of termination. Since this argument was not raised in the district court, and, indeed, Judge Conner was then of the view that all parties agreed that the fair hearing requirements of 45 C.F.R. § 205.10(a) apply to social service programs, we need not reach that issue here. See Safeway Stores v. Oklahoma Retail Grocers Association, 360 U.S. 334, 3 L. Ed. 2d 1280, 79 S. Ct. 1196 (1959). For purposes of this appeal, then, we assume that the federal regulations mean what they say - that the hearing requirements of 45 C.F.R. § 205.10 apply to Title XX services. 45 C.F.R. § 228.14. See generally Schneider v. Whaley, 541 F.2d 916 (2d Cir. 1976).
What remains to be determined is whether the 120 day seeking employment criterion is a "special allowance," 45 C.F.R. § 205.10(a)(4)(ii)(I), requiring adequate but not timely notice. We find that in those narrowly circumscribed instances where the allowance is granted for a specific period and where the recipient is advised of this time limitation at the initiation of services, the special allowance exception applies. Its use should be limited to those situations - such as that of Mrs. Mahoney - where the possibility of error is virtually non-existent, see Harrell v. Harder, 369 F. Supp. 810, 822 (D. Conn. 1974). Judge Conner carefully considered these limitations before concluding that they were met by the 120 day rule.He correctly observed that the 120 day rule runs for an outer limit of time beyond which services may not extend. Indeed, we note that it is the only ...