The President signed into law the Foster Care Independence Act on December 14, 1999. That law made changes in eligibility for SSI/SSP that also affect eligibility for CAPI and IHSS. ACL 00-27 addresses changes in the CAPI program. ACL 00-35 addresses changes in the IHSS program. Those changes are as follows:

A person who applies for or receives CAPI and who disposes of resources for less than fair market value may be ineligible for CAPI for up to 36 months. This provision applies to resource transfers made on or after December 14, 1999.

This period of ineligibility applies to transfers for less than fair market value made after December 14, 1999, and includes transfers made before a CAPI application is made as well as transfers made by a CAPI recipient. There are exceptions to the period of ineligibility imposed for transfers of resources for less than fair market value. These exceptions include:

• Certain transfers of the applicant's or recipient's home;
• Certain transfers of resources to or from the applicant's or recipient's spouse for the sole benefit of the transferor's spouse;
• Transfers of resources to the applicant's or recipient's child who is blind or disabled or to a trust for the benefit of the blind or disabled child; resources transferred to establish a trust solely for the benefit of an individual who is under age 65 who is disabled;
• Where evidence is provided that establishes the transferor intended to dispose of resources either at fair market value or for other valuable consideration;
• Where evidence is provided that establishes that the resources were transferred exclusively for a purpose other than to qualify for SSI or CAPI.
• Where evidence establishes that all transferred resources for less than fair market value were returned to the transferor;
• Where undue hardship exists based upon criteria established by the Social Security administration;
• Certain transfers to trusts established after January 1, 2000.

A trust established by an individual is counted as a resource for purposes of CAPI eligibility. This applies to trusts established on or after January 1, 2000. The trust counts as a resource regardless of why the trust was established, whether the trustee(s) have or exercise discretion under the trust, whether any restrictions on distributions may be made from the trust or whether there are any restrictions on the use of distributions from the trust.

Exceptions to counting the trust as a resource occur when the county determines that undue hardship exists under criteria established by the Social Security administration or to trusts established under Section 1917(d)(4)(A) and (C) of the Social Security Act known as "Medi-Cal pay-back trusts" and "Medi-Cal pooled trusts".

Any person who makes a false or misleading statement or representation regarding a material fact that he/she should know is false or misleading; or omits a fact that a person knows or should know is material; or makes a statement with knowing disregard for the truth, is subject to a period of ineligibility for CAPI.

This period of ineligibility applies for both applications and for ongoing benefits. The penalty is six months for a first instance; 12 months for a second instance and 24 months for a third instance.

The Social Security Administration has six months to develop regulations to prescribe the process for making a determination that the individual is subject to a penalty for a false or misleading statement.