560.8 Shelter/Utility Deduction

A household is entitled to a shelter/utility deduction when shelter and utility expenses are more than 50 percent of the monthly countable gross income after all other deductions.

A household that has an elderly or disabled person may receive a deduction for the full amount of its excess expenses. For all other households, see Chapter 560, Appendix A for the maximum allowable deduction.

NOTE:  The CAO may need to restore benefits if an SSI applicant is later found eligible for SSI benefits. In computing the amount to be restored, the CAO must allow an appropriate utility allowance retroactive to the SNAP application date or the initial SSI eligibility date, whichever is later.

The CAO must allow a deduction for expenses the household has to pay, whether the expenses are paid or not.

560.81 Allowable Shelter Expenses

The CAO must allow the principal and interest charges for continuing costs for the shelter occupied by the household, such as, rent, mortgage, or other costs including condominium and association fees.

560.811 Rent

Living arrangements are not dependent on ownership of the property where the household lives. If a person who lives in a rented house or apartment rents a room in the residence to someone else, the payment is considered self-employment income. SNAP rules do not limit self-employment from renting rooms to persons who own their residence.

Example:  X rents an apartment for $550 a month. Y moves in and pays X $250 a month. X receives SNAP benefits. Y buys and prepares food separately. How to treat the payment from Y depends on the arrangement between X and Y. When households share a residence, the CAO must discuss the situation with the household to determine if the households are actually sharing expenses or if a roomer situation exists.

If the two households are sharing expenses, the payment made from Y to X is not considered income to X, since the payment is simply passed on to the landlord.  X would be allowed shelter costs of $300 for the rent X pays.  If Y applies for SNAP, Y would be allowed shelter costs of $250. 

If the agreement between X and Y is that Y is paying X for a room, then the $250 payment is considered earned self-employment income for X.  Shelter costs of $550 would be allowed for X.

560.812 Mortgage

Allowable mortgage expenses:

Example: An arrested person borrowed money for bail, using his home as collateral. Payments are allowable as shelter costs, because failure to pay the loan, including interest, would result in the loss of the household’s shelter.

560.813 Other costs

Additional shelter/utility expenses allowed:

NOTE:  Delinquent property taxes and late/penalty fees for taxes, assessments, and insurance are not allowable shelter expenses.

NOTE:  Late fees and penalties on mortgages, utilities, and/or property taxes are not to be included as a part of shelter costs.

 

NOTE:   The current occupants of the home, if any, must not be claiming the shelter costs for SNAP purposes. The home may not be leased or rented during the household’s absence.

560.82 Verification of Shelter Expenses

At application, the CAO must verify shelter costs if the applicant:

At SAR review or renewal and during the certification period, the CAO must verify shelter costs only if the information provided by the household is questionable.

Forms of acceptable verification for each allowable expense include, but are not limited to the following:

NOTE:  Insurance premiums on personal property and furnishings are not included.

NOTE:  Should the household fail to provide required verification of the shelter expense, the CAO will compute the household eligibility and allotment without the deduction.

560.83 Allowable Mandatory Standard Utility Allowances

Allowable utility expenses to determine standard utility allowances (SUA) include the following:

NOTE:  Late/penalty fees or interest charges are not allowable utility expenses.

560.831 Four mandatory utility allowances

NOTE:  Cooling costs must be from central air or room air conditioning, not fans.

560.832 Low-Income Home Energy Assistance Program (LIHEAP)

A household is entitled to the HSUA for the certification period as indicated in the LIHEAP system history file in E-CIS during the current annual LIHEAP period (October 1 to September 30) if:

If neither of the two above conditions exists, the household may be entitled to the heating/cooling HSUA if the CAO can anticipate with reasonable certainty that the household will receive a LIHEAP payment in the new LIHEAP period.

Example: A household rents a property.   The rent payment includes heat and there is no air conditioning.  The household received a LIHEAP payment at this same address in the past three years, with the same rental conditions.   The household plans to apply for LIHEAP.    The SNAP renewal is due in the new LIHEAP period and the LIHEAP application period has not yet opened.   Because there were no changes in circumstances and the household has a history of LIHEAP payments, the CAO can reasonably anticipate that the household will receive a LIHEAP payment in the new period for SNAP renewal and benefit computation purposes.

At application and renewal, the CAO must complete an inquiry into the E-CIS Financial Management Menu and search the LIHEAP system history file to confirm whether or not a payment was authorized during the current LIHEAP period.  If the household received a LIHEAP payment during the current LIHEAP period, the household is granted the HSUA for the entire certification period.

When a household moves, the entitlement to the SUA continues if that household received LIHEAP at the previous address and it is within the same annual LIHEAP period.   If it did not receive LIHEAP at the previous address but has received a LIHEAP payment or is authorized and expects to receive a LIHEAP payment at the new address, the household is entitled to the HSUA..

When an adult member leaves a LIHEAP household and applies for SNAP, the member may receive the HSUA, because he or she was included in a LIHEAP payment.

If a household reports receiving a LIHEAP payment during the certification period, the CAO must verify that a payment was authorized and grant the HSUA for the remainder of the current certification period. The household remains eligible for the HSUA if certification renewal occurs during the same LIHEAP period.

Example:  A household applies on April 15 and is found eligible for SNAP.  The heating costs are included in the rent.  Because the household received a LIHEAP payment in January of the same year (the current LIHEAP period) for the same residence, it is entitled to the HSUA for the authorized certification period.

A household that has heating or cooling costs on an irregular basis but is otherwise eligible to use the HSUA may continue to use it between billing periods.

560.833 Shared utility expenses

A SNAP household living with and sharing costs with another person or household is entitled to the appropriate SUA. There is no proration.

Example:  A grandmother is getting SNAP benefits as a separate household. The grandmother has a mortgage and utility expenses. The grandmother’s daughter and grandchild receive SNAP benefits as a separate SNAP household and pay rent to the grandmother.  Both SNAP households live at the same residence and receive LIHEAP as one unit.  Both SNAP households are eligible for the HSUA based on receipt of LIHEAP during the current heating season.

If two or more households share telephone expenses, each household gets the $33 telephone allowance.

560.834 Verification of utility obligations

At application, the CAO must verify utility costs if the applicant:

At SAR review, at renewal, and during the certification period, the CAO must verify utility costs only if the information provided by the household is questionable.

NOTE:  The household must only verify  the shelter and the heating or cooling obligation when receiving the heating SUA.  Other utility obligations must be verified if the Non-Heating SUA is received.

The SNAP household must verify all utility obligations if a deduction is claimed for an unoccupied home.

Acceptable verification of utilities includes the following: 

NOTE:  The CAO must determine eligibility without the deduction if the household fails to provide sufficient verification.

NOTE:  The CAO must narrate the households eligibility to receive or not receive an SUA.

560.84 Shelter/Utility Expenses for Households Receiving HUD or Public Housing Authority Utility Allowances or Rebates

Persons who live in Section 8 or scattered-site housing may be eligible to receive a utility allowance or rebate for utility expenses from the Department of Housing and Urban Development (HUD) or a public housing authority for their utility expenses.  A utility allowance is a payment that reflects the total amount of the average utility bills that a particular type of dwelling is expected to incur. A utility rebate is a payment of a remaining balance of a utility allowance after it has been applied directly to a household’s rental costs.

Utility allowances may be paid in the following methods:

NOTE:  IT is possible that the public housing authority is responsible for paying the utility allowance.   If this is the case and the public housing authority applied the allowance against the rent, the remaining balance of the allowance, if any, is paid to the household as a utility rebate.

NOTE:  This payment is not a vendor payment. It is money that is owed to the household.

The CAO must calculate shelter/utility expenses and determine whether a household receiving utility allowances or rebates is entitled to the SUA. The CAO must determine shelter/utility expenses for these households by evaluating:

NOTE:  Utility allowances or rebates are excluded income. (See Section 550.5.)

When calculating shelter expenses for households receiving a utility allowance or rebate, the amount of rent a household actually pays each month is the household’s monthly shelter expense. This is the amount of rent after the utility allowance is subtracted.

       Examples:

NOTE: Situations may occur in which as household understates its income to HUD.  As a result, the household pays less than the appropriate rent for a period of time. When HUD discovers the error, the household’s rent may be increased to add a charge for recoupment  of rent that should have been collected.  The CAO must not include the recoupment portion of the rental increase in the household’s shelter expenses.

When calculating utility expenses for households receiving a utility allowance or rebate, the CAO must compare the monthly utility costs to the monthly utility allowance or rebate. If the monthly utility costs are more than the monthly utility allowance or rebate during a month, the household may be eligible for the appropriate SUA.

A household receiving a utility allowance or rebate is automatically entitled to an HSUA if it receives a LIHEAP payment.

A household receiving a utility allowance or rebate but not a LIHEAP payment is eligible for the HSUA if the household:

  Example:  A household is individually metered and billed regularly for heating expenses.  The household is eligible for a utility allowance of $125.  $100 of this allowance is forwarded to the public housing authority and allocated to the household’s rent.  $25 is forwarded to the household as a utility rebate.  The household expects utility expenses of $131.25 in a future month of the certification period.  The household is eligible for the heating SUA because out-of-pocket utility expenses exceed the $125 in at least one month. 

NOTE:  If the utility allowance or rebate received by the household equals or exceeds the anticipated utility costs in all applicable months, the household is not eligible for an SUA. 

Reminder:  The household is eligible for the telephone allowance.

Example:  A household is individually metered and billed regularly for heating expenses. The household is eligible for a utility allowance of $100.  The household assigned payment of the utility allowance to the utility company. The household is on a budget plan with the utility company and has monthly average billings of $98.  Each month the utility allowance of $100 is automatically applied to the household’s utility account.  The household does not have any out-of-pocket utility expenses and cannot receive an SUA.

Example:  A household is individually metered and billed regularly for heating expenses.  The household is eligible for a utility allowance of $100.    The household has assigned the payment of the utility allowance to the utility company.  The household is on a budget plan with the utility company and incurs monthly averaged billings of $174 each month.  Each month the utility allowance of $100 is automatically applied to the household’s utility account.  The household incurs out-of-pocket utility expenses each month and is eligible for the heating SUA.  

The CAO must determine eligibility for the proper SUA if the household has utility expenses in excess of its monthly utility allowance or rebate in any applicable month, but is not responsible for heating or cooling expenses.

Reminder:  These expenses must not include telephone costs.

Citations:

7 CFR § 273.2(f)(1)(iii)

7 CFR § 273.2(f)(2)(i)

7 CFR § 273.2(f)(6)

7 CFR § 273.9(d)

7 CFR § 273.9(d)(6)

7 CFR § 273.9(d)(6)(ii)

7 CFR § 273.9(d)(6)(ii)(A)

7 CFR § 273.9(d)(6)(ii)(B)

7 CFR § 273.9(d)(6)(ii)(C)

7 CFR § 273.9(d)(6)(ii)(D)

7 CFR § 273.9(d)(6)(ii)(E)

7 CFR § 273.9(d)(6)(ii)(F)

55 Pa. Code § 501.7(a)(2)

55 Pa. Code § 501.7(a)(3)

Reissued March 1, 2012, replacing March 26, 2009