US SUPREME COURT DECISIONS

The Social Security Amendments of 1967 added § 402(a)(23), which reads:

"[The States shall] provide that, by July 1, 1969, the amounts used by the State to determine needs of individuals will have been adjusted to reflect fully changes in living costs since such amounts were established and any maximums that the State imposes on the amount of aid paid to families will have been proportionately adjusted."

In 1969, New York, by § 131-a of its Social Services Law, altered its standard of need computation under the federally supported Aid to Families With Dependent Children (AFDC) program, and adopted a system fixing maximum allowances per family based on the number of persons in the family and the age of the oldest child, and eliminated a "special grants" program. The state statute resulted in decreased benefits to many New York City recipients. This controversy involving the compatibility of the two statutes arose out of a pendent claim included in petitioners' complaint bringing a class action challenging § 131-a as violative of the Equal Protection Clause by virtue of its provision for lesser payments to AFDC recipients in Nassau County than those allowed for New York City residents. A three-judge court was convened, but, before a decision was rendered, § 131-a was amended to permit Nassau County grants equal to those in New York City. The three-judge court concluded that the equal protection issue was "no longer justiciable," dissolved itself, and remanded the matter to the single District Judge. The District Judge issued an injunction prohibiting the reduction or discontinuance of "regular and recurring grants and special grants" payable under the predecessor welfare law. The Court of Appeals reversed, holding that the three-judge court had properly dissolved itself, but that the District Judge should no have ruled on tho merits of petitioners' statutory claim.

Held:

1. The District Judge had jurisdiction to decide this federal statutory challenge to the New York welfare law. Pp. 397 U. S. 402-407.

(a)Jurisdiction over the primary claim at all stages of the litigation is not a prerequisite to resolution of the pendent chanrobles.com-red

Page 397 U. S. 398

claim, and the mootness of the equal protection claim does not eliminate the jurisdiction of the District Judge over the pendent statutory claim. Pp. 397 U. S. 402-405.

(b) The District Judge properly did not decline jurisdiction to allow the Department of Health, Education, and Welfare (HEW) to resolve the controversy, as neither the "exhaustion of administrative remedies" nor the "primary jurisdiction" doctrine is applicable here. Petitioners do not seek review of an administrative ruling, nor could they have obtained such a ruling, since HEW does not permit welfare recipients to trigger or participate in its review of state welfare programs. Pp. 397 U. S. 405-407.

2. New York's program is incompatible with § 402(a)(23), and petitioners are entitled to an injunction by the District Court against payment of federal monies according to the State's new schedules, should New York not develop a conforming plan within a reasonable time. Pp. 397 U. S. 407-420.

(a) Congress, in § 402(a)(23), required the States to face up to the magnitude of the public assistance requirement, prodded them more equitably to apportion their payments, and spoke in favor of increases in AFDC payments. Pp. 397 U. S. 412-414.

(b) The evidence supports the District Judge's finding that New York has, in effect, impermissibly lowered its standard of need by deleting items that were previously included. Pp. 397 U. S. 415-417.

(c) While § 402(a)(23) does not prevent New York from pursuing a goal of administrative efficiency, it does foreclose the State from achieving this purpose by reducing significantly the content of its standard of need. Pp. 397 U. S. 417-419.

(d) Section 402(a)(23) invalidates any state program that decreases the content of the standard of need unless the State can demonstrate that the items formerly included (here, the system of special grants, not the system of maximum grants based upon average age of the oldest child) no longer constituted part of the reality of existence for the majority of welfare recipients. Pp. 397 U. S. 419-420.

3. Congress has not foreclosed judicial review to welfare recipients who are most directly affected by the administration of the program, and it is the duty of the federal courts to resolve disputes as to whether federal funds allocated to the States for welfare programs are properly expended. Pp. 397 U. S. 420-423.

414 F.2d 170, reversed and remanded. chanrobles.com-red

Page 397 U. S. 399