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    Subdivision 1. Scope of overpayment. When a participant or former participant receives an
overpayment due to agency, client, or ATM error, or due to assistance received while an appeal is
pending and the participant or former participant is determined ineligible for assistance or for
less assistance than was received, the county agency must recoup or recover the overpayment
using the following methods:
(1) reconstruct each affected budget month and corresponding payment month;
(2) use the policies and procedures that were in effect for the payment month; and
(3) do not allow employment disregards in section 256J.21, subdivision 3 or 4, in the
calculation of the overpayment when the unit has not reported within two calendar months
following the end of the month in which the income was received.
    Subd. 2. Notice of overpayment. When a county agency discovers that a participant or
former participant has received an overpayment for one or more months, the county agency must
notify the participant or former participant of the overpayment in writing. A notice of overpayment
must specify the reason for the overpayment, the authority for citing the overpayment, the time
period in which the overpayment occurred, the amount of the overpayment, and the participant's
or former participant's right to appeal. No limit applies to the period in which the county agency is
required to recoup or recover an overpayment according to subdivisions 3 and 4.
    Subd. 3. Recovering overpayments. A county agency must initiate efforts to recover
overpayments paid to a former participant or caregiver. Caregivers, both parental and nonparental,
and minor caregivers of an assistance unit at the time an overpayment occurs, whether receiving
assistance or not, are jointly and individually liable for repayment of the overpayment. The county
agency must request repayment from the former participants and caregivers. When an agreement
for repayment is not completed within six months of the date of discovery or when there is a
default on an agreement for repayment after six months, the county agency must initiate recovery
consistent with chapter 270A, or section 541.05. When a person has been convicted of fraud
under section 256.98, recovery must be sought regardless of the amount of overpayment. When
an overpayment is less than $35, and is not the result of a fraud conviction under section 256.98,
the county agency must not seek recovery under this subdivision. The county agency must retain
information about all overpayments regardless of the amount. When an adult, adult caregiver, or
minor caregiver reapplies for assistance, the overpayment must be recouped under subdivision 4.
    Subd. 4. Recouping overpayments from participants. A participant may voluntarily repay,
in part or in full, an overpayment even if assistance is reduced under this subdivision, until the
total amount of the overpayment is repaid. When an overpayment occurs due to fraud, the county
agency must recover from the overpaid assistance unit, including child only cases, ten percent of
the applicable standard or the amount of the monthly assistance payment, whichever is less. When
a nonfraud overpayment occurs, the county agency must recover from the overpaid assistance
unit, including child only cases, three percent of the MFIP standard of need or the amount of the
monthly assistance payment, whichever is less.
    Subd. 5. Recovering automatic teller machine errors. For recipients receiving benefits via
electronic benefit transfer, if the overpayment is a result of an ATM dispensing funds in error to
the recipient, the agency may recover the ATM error by immediately withdrawing funds from the
recipient's electronic benefit transfer account, up to the amount of the error.
    Subd. 6. Scope of underpayments. A county agency must issue a corrective payment for
underpayments made to a participant or to a person who would be a participant if an agency
or client error causing the underpayment had not occurred. The county agency must issue the
corrective payment according to subdivision 8.
    Subd. 7. Identifying the underpayment. An underpayment may be identified by a county
agency, by a participant, by a former participant, or by a person who would be a participant except
for agency or client error.
    Subd. 8. Issuing corrective payments. A county agency must correct an underpayment
within seven calendar days after the underpayment has been identified, by adding the corrective
payment amount to the monthly assistance payment of the participant or by issuing a separate
payment to a participant or former participant, or by reducing an existing overpayment
balance. When an underpayment occurs in a payment month and is not identified until the
next payment month or later, the county agency must first subtract the underpayment from
any overpayment balance before issuing the corrective payment. The county agency must not
apply an underpayment in a current payment month against an overpayment balance. When an
underpayment in the current payment month is identified, the corrective payment must be issued
within seven calendar days after the underpayment is identified.
    Subd. 9. Appeals. A participant may appeal an underpayment, an overpayment, and a
reduction in an assistance payment made to recoup the overpayment under subdivision 4. The
participant's appeal of each issue must be timely under section 256.045. When an appeal based on
the notice issued under subdivision 2 is not timely, the fact or the amount of that overpayment
must not be considered as a part of a later appeal, including an appeal of a reduction in an
assistance payment to recoup that overpayment.
History: 1997 c 85 art 1 s 27; 1998 c 407 art 6 s 76; 1999 c 245 art 6 s 49; 1Sp2003 c
14 art 1 s 48,49

Official Publication of the State of Minnesota
Revisor of Statutes