Expenses Exceed Income (EEI)
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When a budgetary unit(g) reports their expenses exceed their reported income and available resources, an “expenses exceed income (EEI)” situation exists.
Policy
An Expenses Exceed Income (EEI) situation exists when a budgetary unit reports expenses that are more than all of the following:
●The budgetary unit’s reported gross income.
●The budgetary unit’s available resources.
Participants whose living expenses exceed their income are required to provide information about the management of their finances. The participant may not be eligible for NA or CA benefits when one of the following occurs:
●The participant does not respond to a request for information about paying their bills.
●The participant provides bills that are paid, but the participant does not identify how the bills were paid.
FAA explores the participant’s income and expenses at the interview to determine whether the budgetary unit’s expenses exceed their income. When a budgetary unit is EEI, the participant is asked to explain how they plan to pay their bills.
During the interview, participants not currently receiving benefits need to resolve or address the EEI situation, even when there is a loss of income. The participant can provide a statement, which needs to make sense and not conflict with other known information related to their case.
NOTE Refusing to discuss or explain an EEI situation during the interview is considered a refusal to cooperate. The participant needs to cooperate before eligibility can be determined. For more information about cooperation requirements, see Refusal to Cooperate.
After approval, FAA may send a notice to the participant asking how they meet their expenses. The participant has to respond to this FAA request for information, even when nothing has changed since the interview. Failure to respond to an FAA request for information can cause benefits to stop.
NOTE When FAA receives information from the participant, there is no change to the benefits when the unpaid expenses continue to exceed the budgetary unit's income.
Benefits are stopped when one of the following occur:
●The participant met their expenses and continued to be EEI without an explanation.
NOTE The participant has to report all income and resources to be eligible for benefits.
●The participant failed or refused to provide EEI information.
NOTE A new application may not be necessary when the participant provides the requested information after denial or after benefits have been stopped.
Procedures
EEI at the Interview
To determine EEI use the participant’s statement of the monthly amount of the reported expense and income on the application.
For a new application, document the participant’s explanation of EEI in the case file(g) and how they plan to pay their bills.
When otherwise eligible, approve benefits at the initial interview when a budgetary unit continues to be EEI after the discussion at the interview.
At the interview, allow the participant 10 calendar days to provide information about EEI for each of the situations:
●At the initial interview, the participant refuses to discuss the EEI situation.
●A participant is reapplying after denial closure for EEI because of one of the following:
Failed or refused to respond to an original EEI information request.
Had paid expenses that continued to exceed the reported income.
NOTE When FAA receives information from the participant, there is no change to potential eligibility when the unpaid expenses continue to exceed the budgetary unit's income.
EEI After Approval
For programs subject to Simplified Reporting, review EEI at the following renewal interview.
For programs assigned to Standard Reporting, set the EE ACTS Alert Code when all of the following occur:
●The budgetary unit was determined eligible
●The budgetary unit’s expenses exceed their income
See Standard Reporting and Simplified Reporting to determine reporting requirements.
When the EE ACTS alert is received, send the Expenses Exceed Income C003 notice allowing the PI 10 calendar days to return the verification.
NOTE When the PI contacts FAA and indicates that they cannot provide the verification, assist the PI in obtaining the required proof. A participant’s statement can be used as verification. Do not send an additional information request to the participant.
EEI Information Provided on or Before the Notice Due Date
When the requested information on EEI is received, determine whether the participant reported a change.
When the participant provides a signed and dated statement from someone else paying the participant’s expenses, budget the income as one of the following:
●A loan
●A vendor payment
●A gift
For more information about changes, see Participant Initiated Changes and When to Effect Changes.
No action is required when the participant is not meeting their expenses and provides overdue bills, eviction, or shut-off notices. Send the No Change to Benefits (C705) notice.
Stop benefits allowing for Notice of Adverse Action (NOAA) when one of the following applies:
●The information provided indicates the budgetary unit's paid expenses continue to exceed the reported income without information about how the bills were paid.
●The participant fails or refuses to respond to the information request by the notice due date.
To determine when to stop benefits, see Notifying Participants of Actions Regarding Their Benefits.
Verification
The verification that can be used depends on which of the following EEI situations apply to the participant:
●At an initial interview, when a participant is not able to pay their expenses, examples of verification that can be used as proof they are not paying their bills include, and are not limited to, any of the following:
Overdue bills.
Eviction notice.
Shut off notices.
A participant’s statement, when not questionable(g).
NOTE A participant’s statement may include the phrase “I don’t know”.
●After approval, when shelter and utility bills are paid, examples of verification of proof of how the bills were paid include, and are not limited to, any of the following:
A participant statement verification that identifies receipt of noncash contributions.
Bank statements indicating withdrawals or sufficient resources to meet living expenses.
Loan documents.
A signed and dated statement from a person providing funds identifying whether the funds are considered one or more of the following:
●Loan
●Gift
●Vendor payment
●The participant is working instead of making payment (in-kind income)
NOTE The statement has to include the phone number and complete address of the person providing funds, the amount of money supplied, and how long they are going to provide funds.
AZTECS Keying Procedures
When denying or stopping benefits for refusal or failure to provide EEI information, all of the following apply:
●Key the VI Denial Closure Reason Code on FSED and AFED.
●On NORE, send one or more of the following notices:
For NA, send the NA Denial/Closure (F200) notice
For CA, send the Cash Assistance Deny/Close (A200) notice
When the requested information is provided after denial closure, see the following to determine whether the application can be reverted to open:
●For new applications, when a participant provides information after a denial, see NA Participant Complies in the Second 30-day Period.
●For renewal applications, when a participant provides information after a denial, see Compliance with NA Renewal Requirements After the Approval Period Ends.
●When the participant provides information after benefits have stopped, see NA Compliance After Closure.
Legal Authorities
7 CFR 273.2(f)(1)(i)
AAC R6-12-501
last revised 03/28/2022