The opinion of the court was delivered by: KIMBA M. WOOD
This court previously issued an order granting plaintiffs' motion for summary judgment and denying defendants' motion for summary judgment. This opinion states the reasons for that order.
The named plaintiff represents a class consisting of recipients of Aid to Families with Dependent Children ("AFDC"), on whose behalf the state collects child support payments. Defendant Louis W. Sullivan, M.D. is the Secretary of the United States Department of Health and Human Services; defendant William J. Grinker is the Commissioner of the New York City Human Resources Administration and represents the class of all commissioners of New York State social services districts; and defendant Cesar A. Perales is the Commissioner of the New York State Department of Social Services.
The AFDC program encourages the care of dependent children in their own homes or in the homes of relatives by helping parents or relatives to become financially able to provide for those children. See 42 U.S.C. § 601. The program is a federal-state cooperative effort. In 1984, the program was altered by the Deficit Reduction Act of 1983 (DEFRA), Pub. L. 98-369, 98 Stat. 494. From that point until amended, effective January 1, 1989, § 657(b)(1) of DEFRA provided:
The first $ 50 of such amounts as are collected periodically which represent monthly support payments shall be paid to the family without affecting its eligibility for assistance or decreasing any amount otherwise payable as assistance to such family during such month[.]
Viewed on its own, this amendment had the effect of increasing many families' total income, but viewed from a broader perspective, it was a slight, legislative quid pro quo for certain other features of DEFRA, which had "the practical effect  that many families' total income was reduced." Bowen v. Gilliard, 483 U.S. 587, 594, 97 L. Ed. 2d 485, 107 S. Ct. 3008 (1987).
Section 657(b)(1) is referred to as a "pass-through" provision. Prior to the enactment of this section, all child support payments to AFDC recipients were assigned to the state or local government entity distributing AFDC benefits, as a condition of eligibility for those benefits. The pass-through provision altered the statutory scheme so that, although all child support payments still went first to the state or local entity, a certain portion of a parent's monthly child support payments would (in effect) be turned back to the child, and would not diminish the AFDC benefits. That is, a certain portion of these payments would "pass through" the government's hands into the hands of the child for whose benefit the payments were made (such payments often are made through a circuitous route -- e.g., a payment may occur by means of a garnishment of the parent's wages by the parent's employer who, in turn, remits the payment to the government).
The Secretary of Health and Human Services promulgated a regulation, codified at 45 C.F.R. § 302.51(b)(1), interpreting § 657(b)(1) to require the state to distribute the first $ 50 of child support collected only when the state or local entity receives that payment in the month in which it is due. That regulation, as it existed from 1984 until 1989, provided:
Of any amount that is collected in a month which represents payment on the required support obligation for that month, the first $ 50 of such amount shall be paid to the family . . . . If the amount collected includes payment on the required support obligation for a previous month or months, the family shall only receive the first $ 50 of the amount which represents the required support obligation for the month in which support was collected.
Defendant Perales in turn promulgated 18 N.Y.C.R.R. § 352.15(a), which in pertinent part mirrored the federal regulation. Each social service district commissioner was bound to follow both regulations. See Social Service law (SSL) §§ 20 and 65.