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May 12, 1980

Richard WIGHTMAN, Plaintiff,

The opinion of the court was delivered by: CURTIN


This is a Social Security disability case in which the claimant moves to reinstate his reduced benefits. The case involves several novel legal issues so I have set out the facts in some detail.

Plaintiff Richard Wightman is disabled. There is no dispute about his eligibility for Supplementary Security Income (SSI) benefits. *fn1" He lives with his mother and stepfather in Wellsville, New York. He has his own room, but takes his meals together with the rest of the household. Until November 1976 he received $ 175.98 per month in SSI benefits. *fn2" The family's combined household expenditures come to $ 411.17 per month. *fn3" In order to carry his share of these expenses, Mr. Wightman made three kinds of contributions to the household: (1) he made cash payments of $ 115 per month from his SSI check; (2) he purchased $ 5 in groceries per week for the household; and (3) he made in-kind contributions in the form of doing housework and cooking family meals.

 In November 1976, the Social Security Administration (SSA) conducted one of its "periodic redeterminations" of plaintiff's eligibility for SSI benefits. SSA determined that plaintiff was "living in the household of another" and was accordingly subject to a one-third reduction of the federal payment amount included in his SSI benefits. Plaintiff's benefits were reduced from $ 175.98 to $ 120.05, *fn4" resulting in his being unable to continue making the same cash and grocery contributions to his family. Without aid of an attorney, plaintiff appealed against the $ 55.93 reduction in benefits. On August 3, 1977 the Administrative Law Judge (ALJ) affirmed the action of SSA, relying on 20 C.F.R. § 416.1125(b). The judge held:

(A) beneficiary's supplemental security income benefits are to be reduced by one-third if the beneficiary lives in the household of another from whom he is receiving room and board. The same section further provides that the one-third reduction will apply regardless of whether the individual is making any payment for support and maintenance (room and board) to the person whose household he is living in. *fn5"

 Plaintiff has exhausted his administrative remedies and the case is here on appeal. *fn6"


 It is true that 42 U.S.C. § 1382(a)(2)(A), as amended in 1977, does say that receipt of in-kind support and maintenance from a person in whose household the disabled person is living will result in a one-third reduction in the federal payment amount of SSI benefits. This would seem to cover our case. The Secretary of HEW, however, has promulgated regulations which define what constitutes living in "another person's household." These regulations have an exception for individuals "paying at least a pro rata share of the average monthly total household operating expenses." 20 C.F.R. § 416.1125(b)(3)(iv). The definition of the term "total household operating expenses" includes the following statement:

A pro rata share of total household operating expenses is determined by dividing the monthly average of these expenses by the number of persons in the household regardless of age or individual consumption of any of the items. Payment of an amount which is within $ 5 of the monthly pro rata share is considered to meet the pro rata requirement.

 20 C.F.R. § 416.1125(b)(5).

 Because of this exception for beneficiaries who contribute their pro rata share of household expenses, the outcome of our case depends on the status of the plaintiff's contributions. There can be no dispute that the $ 115 cash transfer is the kind of payment which the Secretary had in mind in promulgating his regulation. Plaintiff here, however, also contributed $ 5 per week worth of food toward the common household's needs. Using the Secretary's averaging factors, this amounts to an additional contribution of $ 21.67 per month. *fn7" Defendant does not dispute that the addition of groceries is also includable in calculating plaintiff's "contribution." The regulation does not require that the applicant make his pro rata share of average monthly total household operating expenses in cash. The test is whether a sufficient contribution was made, not what form did the contribution take.

 Plaintiff's pro rata share of his three-person household's $ 411.17 monthly expenses is $ 137.06. The combination of the $ 115 monthly cash payment with the additional in-kind contribution of groceries worth $ 21.67 means that plaintiff contributes a total of $ 136.67. This is well within the $ 5 per month deviation from plaintiff's required pro rata share countenanced by the statute. 20 C.F.R. § 416.1125(b)(5). The Secretary's memorandum acknowledges that "if proven" these combined contributions would be sufficient to constitute payment of a pro rata share of expenses.

 The government's position has changed somewhat over the course of this litigation. At first the government took the highly formalistic position that only if plaintiff were to "modify" his living arrangement, for example, by "renting" a room from his family, could the fair market value of the leasehold be deducted from the grant on a dollar-for-dollar basis. 20 C.F.R. § 416.1125(d). Such artificial legal calisthenics, not to say subterfuge, are not necessary, however. The Secretary has interpreted 42 U.S.C. § 1382a(a)(2) so as to permit the plaintiff's family living arrangement. The regulations are clear on this point. Where the beneficiary is living in the same household with non-recipients, the one-third automatic reduction in federal payment amount only comes into effect when the SSI recipient receives a net contribution toward his food and shelter from the other members of his household. *fn8" Here the allegations are that the plaintiff receives no such contribution as he pays his way, within his family.

 The government's other argument concedes that a total monthly contribution of $ 136.67 would be sufficient to meet the test in the Secretary's regulations, 20 C.F.R. § 416.1125(b)(3)(iv), but maintains that the record "reveals an insufficient basis for such a finding." The government argues that the ALJ's findings indicated a credibility determination against plaintiff on the question of the contribution of the $ 5 in groceries per week. *fn9" The government specifically acknowledges ...

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