Section 18927.

(a) Current and future CalFresh benefits shall be reduced in accordance with subdivisions (c) and (d) to recover an overissuance caused by intentional program violation, as defined in subdivision (c) of Section 273.16 o, or fraud, or inadvertent household error.

(b) Current and future CalFresh benefits shall be reduced in accordance with subdivisions (c) and (d) to recover an overissuance caused by administrative error if required by federal law or if the overissuance exceeds one hundred twenty-five dollars ($125) or the threshold established pursuant to subdivision (h), whichever is greater.

(c) A household's CalFresh benefits shall not be reduced to recover an overissuance as required or authorized by subdivision (a) or (b) unless the household receives adequate and timely notice of the overissuance, including, but not limited to, the budget worksheet that includes the amount and calculation of the overissuance and the reason for the overissuance.

(d) (1) In recovering an overissuance caused by administrative error, a recipient household's monthly CalFresh benefits shall not be reduced by more than 5 percent of the household's monthly CalFresh benefits or ten dollars ($10), whichever is greater, unless the recipient elects for the benefits to be reduced at a higher rate.

(2) In recovering an overissuance caused by inadvertent household error, a recipient household's monthly CalFresh benefits shall not be reduced by more than 10 percent of the household's monthly CalFresh benefits or ten dollars ($10), whichever is greater.

(3) In recovering an overissuance caused by intentional program violation, as defined in subdivision (c) of Section 273.16 o, or fraud, a recipient household's monthly CalFresh benefits shall be reduced by 20 percent of the household's monthly CalFresh benefit or twenty dollars ($20), whichever is greater.

(e) If a household is no longer receiving CalFresh benefits, a CalFresh overissuance caused by administrative error shall not be established, and collection shall not be attempted, if the overissuance is less than one hundred twenty-five dollars ($125) or the threshold established pursuant to subdivision (h), whichever is greater.

(f) If a household is no longer receiving CalFresh benefits, collection shall be attempted if the overissuance is caused by inadvertent household error and the overissuance is thirty-five dollars ($35) or more. All overissuances caused by intentional program violation, as defined in subdivision (c) of Section 273.16 o, or fraud shall be collected as required by federal law.

(g) When an overissuance collection is attempted, reasonable cost-effective methods of collection shall be implemented. The department shall define reasonable cost-effective collection methods, which shall include adequate and timely notice of the overissuance, including, but not limited to, all of the following:

(1) The amount and calculation of, and reason for, the overissuance.

(2) A statement of the monetary threshold described in this subdivision.

(3) Information about how to appeal the overissuance.

(4) Instructions for timely commencement of repayment.

(5) Consequences of delinquent payment.

(h) The department may establish a minimum cost-effective threshold for collecting CalFresh overissuances. If the department determines that the minimum cost-effective threshold is greater than one hundred twenty-five dollars ($125), this threshold shall be included in the state's claims management plan submitted annually for federal approval.

(i) Nothing in this section shall prevent a county from writing off or terminating an overissuance claim when it meets the provisions of paragraph (8) of subdivision (e) of Section 273.18 o.

(j) Nothing in this section shall prevent a county or the state from collecting all overissuances that are identified during a quality control review, as required by Section 275.12 o.

(k) Notwithstanding the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), the department may implement this section through all-county letters or similar instructions from the director no later than January 1, 2014, to allow for automation updates required by this section to be made in coordination with other scheduled updates.

(Added by Stats. 2012, Ch. 491, Sec. 2. Effective January 1, 2013.)