Underpayments

An underpayment occurs when:

• A client was not issued a benefit they were entitled to receive, or
• A client was issued less than the amount of benefit for which they were eligible.

An underpayment must be credited back to the client.

• When issuing an underpayment from a month outside of the current month, and no overpayment or debt exists for that month, the worker can issue the full retroactive payment to the client.
• If an overpayment or debt exists for the same month, and has been entered in the Recoveries System, the underpayment may be used to reduce the overpayment or debt to zero.

Note
Resolving an underpayment balance while the file is active ensures issues are resolved quickly and minimizes work to Community and Social Services and the Government of Alberta.

If an underpayment is determined to exist on a closed file that has been closed for less than 30 days since the last benefit was issued, the worker must review the file to first determine if adding the benefit to the client’s budget would have made the client eligible for ongoing assistance.

If the client’s file is closed the underpayment may be placed against any outstanding debts the client has incurred which exist on the Recoveries System. The worker applies the underpayment to the earliest period of assistance on the Recoveries System (oldest debt first) where an outstanding overpayment exists. If after adjusting all outstanding debts on the Recoveries System, there is still a balance owed to the client, the balance must be paid to the client.

Underpayments may not be transferred between clients in the Learner client category and clients in the ETW/BFE client categories.

Note
To determine the amount of an underpayment, previous eligibility criteria and benefit rates relating to a specific period of assistance may be required. Information on previous benefit rates and eligibility criteria can be found on each page of the online policy manual by selecting the drop down box marked “Select a Previous Policy”.

PROCEDURE

LISA automatically posts Need Code 1887 Underpayment to the Scratch Pad.

Active File Where No Overpayment or Debt Exists For the Same Month
The worker:

1. Checks the Scratch Pad to determine if an underpayment had previously been determined.
   
2. If the underpayment had already been determined, advises the client.
   
3. If this is a new underpayment issues the full retroactive payment using Need Code 1887 Underpayment in a lump sum on the current month’s budget on LISA.

Active File Where an Overpayment or Debt Exists For the Same Month
The worker:

1. Adjusts the overpayment or debt in the Recoveries System by adding Need Code 1887 Underpayment.
   
2. Enters comments using both the Internal Comments and the OP/Debt Notice Comment on the Recoveries System, indicating:
   
   • The amount of the underpayment being issued,
   • The period for which the underpayment is being issued, and
   • What benefit was underpaid or income was not received causing the underpayment.
     
3. If the underpayment for the month is greater than the outstanding overpayment or debt, the worker adjusts the outstanding balance to zero on the Recoveries System, and issues the remainder of the underpayment on the current month’s budget on LISA.
   
   Note
   The Recoveries System must not be used to balance an overpayment or debt from month to month. The overpayment or debt can only be adjusted up to the maximum of the outstanding overpayment or debt for that month. It will not allow a credit in one month and debt in another in order to balance the total overpayment or debt to zero.

File Closed Less than 30 days
If the client would have been eligible for assistance if the underpayment had been issued, the worker:

1. Re-opens the income support file and revises the LISA budget for the last period of assistance for which the client was assisted prior to the file closing.

    

2. Issues the underpayment using the need code for the benefit which was under issued.

    

3. Releases the benefit to the client as if the file had not been closed.

    

4. Records Notes in Mobius indicating that the file closed in error and that the budget has been adjusted.

Closed File Where a Debt Exists During Any Period of Assistance
The worker:

1. Enters the OP/Debt Groups Tab to adjust the overpayment.

    

2. Adjusts the overpayment(s) in successive periods of assistance starting with the oldest debt first, by adding Need Code 1887 Underpayment into the Revised Budget field, up to the maximum of the outstanding debt for each separate period of assistance. Adjusting the budget using this need code will reduce the outstanding amount of the debt for the period of assistance being adjusted.

    

3. After adjusting the debt, enters comments using both the Internal Comments Tab and the OP/Debt Notice Comment on the Recoveries System, indicating:
   
   • The amount of the underpayment being issued,
   • The period for which the underpayment is being issued, and
   • What benefit was underpaid or income was not received.

Closed File Where no Debt Exists, or the Balance of an Underpayment Still Exists After Applying the Underpayment to an Existing Debt
The worker attempts to contact the client using the last known contact information on file.  If attempts to contact the person by telephone are unsuccessful, or not possible, a letter must be sent advising the client to contact the department regarding benefits for which they are eligible.

If the client makes contact, the worker:

1. Explains the underpayment.
2. Opens the file or has the client’s electronic file downloaded from the CCD to LISA.
3. Enters Function 1 – Eligibility Determination and Function 4 – Reopen Client and issues any outstanding balance to the client by way of a one-time issue under Need Code 1887 Underpayment.
4. Allows the file to system close after having issued the benefit.
5. Enters Notes in Mobius.

If, after 30 days the worker is not able to make contact with the client, the worker:

1. Enters an alert on CCD, using Alert Code 29 Underpayment Owing, noting that the client is owed an underpayment and identifies:
   
   • The reason,
   • The period of assistance for which the client was underpaid, and
   • The amount owed to the client.
     
2. If the client re-applies in the future, will explain to the client that they were previously underpaid as per the alert.
   
3. If the applicant is deemed eligible for assistance, this underpayment will be added to the client’s budget using Need Code 1887 Underpayment.
   
4. If the applicant is deemed not eligible for assistance, issue the underpayment as a one-time issue under Need Code 1887 Underpayment.

The Unclaimed Property and Vested Property Act requires that holders of abandoned and lost property ensure property is returned to the owner and when the owner cannot be located the holder must register the property with the program.

Every year the Income Support Program Area will review files with Alert Code 29 to identify underpayments that meet the criteria for transfer to Finance and Enterprise under the Unclaimed Personal Property and Vested Property Act. When required worksites will be contacted and provided direction regarding how to deal with these underpayments.