HECKLER, SECRETARY OF HEALTH AND HUMAN SERVICES v. TURNER Et Al.
Headline: Ruling lets Health and Human Services apply a new law to AFDC income rules, staying a lower-court injunction so officials can deduct work expenses from gross pay starting July 18, 1984.
Holding:
- Allows officials to deduct $75 work expense from gross earned income beginning July 18, 1984.
- Prevents about $2.6 million per month in additional AFDC payments.
- Suspends the lower-court injunction while the Supreme Court reviews the case.
Summary
Background
The Solicitor General, on behalf of the Secretary of Health and Human Services, asked a Justice to stay a permanent injunction that limited how states and federal officials count income for Aid to Families with Dependent Children (AFDC). The injunction, entered in a California federal court and affirmed by the Ninth Circuit, barred including certain payroll deductions when defining “income.” Meanwhile, Congress passed the Deficit Reduction Act on July 18, 1984, which said “earned income” means gross pay before any deductions.
Reasoning
The core question was whether the injunction should keep blocking officials from following Congress’s new definition of earned income. The Justice examined the statutory amendment and its conference report, found Congress intended to resolve the conflicting circuit decisions for the future, and concluded the Secretary was likely correct about applying the amendment going forward. The Justice also found that keeping the injunction in place would cause unrecoverable financial harm and would frustrate Congress’s clear direction.
Real world impact
The Justice granted a prospective stay effective July 18, 1984, so officials may treat earned income as gross pay and deduct the $75 work expense disregard from gross earnings when determining AFDC eligibility and benefits. This pause is temporary while the case is reviewed by the full Court, so the final legal outcome could still change. The stay prevents ongoing monthly overpayments that the record estimates at about $2.6 million per month.
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