West v. Bowen

OPINION OF THE COURT

GARTH, Circuit Judge.

Plaintiff/Appellant, Marie West (“West”), individually, and as the representative of two different classes of individuals who claim that they have not received food stamp benefits to which they are entitled, appeals from a summary judgment order entered in favor of Defendant/Appellee, Bowen, Secretary of the Department of Health and Human Services (“HHS”), and other governmental defendants with respect to both classes. We will affirm the district court’s judgment as it concerns Class A, and reverse with respect to Class B.1

I.

While West's original complaint2 seeking SSI disability benefits was pending, West amended her complaint to include allegations that her rights under the Food Stamp Act were being violated by HHS, the United States Department of Agriculture (“USDA”) and the Pennsylvania Department of Public Welfare (“DPW”). West alleged two separate violations: she first charged that although she received SSI disability benefits which accrued to her from the date she applied for the benefits (May, 1983) to the date she began receiving benefits pursuant to the district court’s order, she only received food stamp benefits from the date of the district court’s order awarding her disability benefits (July, 1985). West claims that just as she was entitled to SSI benefits from the date of her application, she was entitled to recover food stamp benefits retroactively, i.e., from the date of her disability application.

West’s second complaint was that USDA in administering the food stamp program, improperly included as income, when calculating her food stamp benefits, monies which West received from DPW as reimbursement for utility expenses.

The district court certified two classes of claimants: Class A claimants who seek retroactive food stamp benefits, and Class B claimants who seek relief from the allegedly improper inclusion of utility rebates in income. All parties moved for summary judgment and the district court ruled against West on all of her class action claims. West appeals.

II.

Before turning our attention to the merits of West’s claims, we address our standard of review. The issues presented here require us to review the Secretary of Agriculture’s interpretation of the Food Stamp Act in accordance with the following instruction:

*1124When a court reviews an agency’s construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction of the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.

Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43, 104 S.Ct. 2778, 2781-82, 81 L.Ed.2d 694 (1984) (footnotes omitted). See also Wheeler v. Heckler, 787 F.2d 101, 104 (3d Cir.1986) (“We must defer to [the Secretary’s] construction, as long as it is reasonable and not arbitrary and capricious.”); Pennsylvania v. United States, 752 F.2d 795, 798 (3d Cir.1984) (“[A] reviewing court must uphold the agency’s interpretation if it is reasonable, notwithstanding the court's belief that some other policy was preferable.”)

Thus, in the absence of Congress’ unambiguously expressed intent, we are bound to defer to the Secretary’s interpretation, if that interpretation is reasonable and based on a permissible construction of the statute, in this case 7 U.S.C. § 2012(r), see note 3, infra.

III.

The Food Stamp Act, 7 U.S.C. §§ 2011, et seq. (“The Act”), establishes a federally funded, state administered program to supplement the food purchasing power of eligible individuals. Participants receive coupons which can be used to purchase food from regular stores. 7 U.S.C. § 2013(a). Eligibility for participation in the food stamp program is based on a household’s gross income, which includes income from whatever source, subject to certain exemptions and deductions. 7 U.S.C. § 2014(d). Generally, as an individual’s income goes up, the amount of his food stamp allotment goes down.

The Act affords special treatment for elderly and disabled people who apply for food stamps. For example, only elderly or disabled people may claim defined medical expenses as deductions when computing their income to determine their food stamp allotment, 7 U.S.C. § 2014(e)(A), and only elderly or disabled individuals may deduct the full amount of their shelter costs when computing their income. 7 U.S.C. § 2014(e)(0). For the purposes of the Food Stamp Act, a disabled person is someone who “receives” Social Security disability payments. 7 U.S.C. § 2012(r)(2), (3).3

It is this definition of “disabled” which has given rise to the present appeal of the Class A members. When an individual is already receiving Social Security disability benefits, an application for food stamps can be processed immediately. However, when an individual applies for both disability ben*1125efits and food stamps at the same time, the food stamp application is held pending a determination by the Social Security Administration that the individual applicant is entitled to disability benefits. This time period is referred to as the “disability determination period.” In many cases, it is not uncommon for a substantial amount of time to elapse before a final determination is made that an individual is entitled to disability benefits. In West’s case, it took over two years. During this time period, she did not receive benefits of any kind.

Because West was ultimately successful in her disability appeal from the AU to the district court, she received a lump sum payment from SSA covering the time period from the date she first applied for disability benefits through the date that she began receiving them pursuant to the district court’s order. In other words, she received a lump sum payment for the entire “disability determination period.” However, even though it was determined that she was also entitled to food stamps for the same time period, the USDA refused to issue food stamps for that period.

The USDA based its refusal to issue the stamps retroactively on its interpretation of the word “receive.” As noted previously, 7 U.S.C. § 2012(r) provides for food stamps based on the disability of an individual who is “receiving” Social Security benefits. USDA claims that since West was not actually “receiving” disability benefits during the “disability determination period,” she was not entitled to retroactive food stamps covering that time period.

USDA initially took the position, i.e., that retroactive payments were inappropriate, with respect to all disabled applicants for food stamps. USDA subsequently modified its position and allowed retroactive payments of food stamps when the applicant was “categorically eligible.” 51 Fed. Reg. 28196, 28200 (August 5, 1986). A “categorically eligible” person is someone who lives in a household where every member of the household receives some form of federal assistance. 7 U.S.C. § 2014(a). The regulation only allows for retroactive food stamp payments for “disability determination periods” after December 23, 1985, the date Congress enacted the statute which recognized “categorical eligibility”. USDA concedes that this statute recognizing categorically eligible people, now codified at 7 U.S.C. 2014(a), does not require retroactive payments. (A. 461). Nevertheless, USDA has decided to make retroactive payments as a matter within its discretion.

To summarize: Since disability status for purposes of the Food Stamp Act is acquired only upon certification and notification to USDA of an individual’s disability determination, the Secretary of Agriculture has taken the position that noncategorically eligible persons are barred from recovering retroactive food stamp benefits even for periods determined by the Secretary of HHS to actually have been periods of disability.

IY.

West reaises a number of arguments in opposition to the USDA’s ruling. First, West argues that the statute reads that a person is considered disabled if he or she “receives supplemental security income benefits under Title XVI of the Social Security Act_” 7 U.S.C. § 2012(r). West points out that the statute, contrary to the Secretary’s reading, does not read “receives supplemental benefits during the month for which they are intended.” West argues that in effect, USDA has inserted into the statute, the words which we have underlined.

West also notes that the section which establishes “categorical eligibility” uses virtually the same language as § 2012(r). Thus, a person is categorically eligible if every person in his household “receives ... supplemental security income benefits under Title XVI of the Social Security Act_”7 U.S.C. § 2014(a). West argues that because USDA permits retroactive payments to categorically eligible applicants, the effect of USDA’s actions in refusing retroactive payments under § 2012(r) but authorizing retroactive payments under § 2014(a), is to give the word “receives” as it appears in both § 2012(r) and § 2014(a), two entirely different mean*1126ings. West claims Congress could not have intended such a result.

West also presents two alternative arguments: (1) that USDA’s actions amount to unlawful discrimination against the disabled; and (2) that the refusal to grant retroactive benefits amounts to a denial of due process. We will address the statutory argument first, and then turn our attention to the alternate arguments that West makes.

A.

In addressing West's statutory argument, the district court felt itself constrained by Commonwealth of Pennsylvania v. United States, 752 F.2d 795 (3d Cir.1984). In that case, Pennsylvania sought reimbursement from the federal government for AFDC payments made to individuals who ultimately received SSI benefits. 42 U.S.C. § 602(a)(24) forbids an individual from “receiving” both SSI and AFDC.4 The issue in Commonwealth arose from the varying funding responsibilities of the States and the federal government with respect to SSI benefits and AFDC benefits, and the federal government’s methods for ensuring that no individual “receives” the benefit of both types of public assistance in violation of 42 U.S.C. § 602(a)(24).

The Commonwealth court set forth the circumstances of that case as follows: The State (Pennsylvania) funds approximately half of an individual’s AFDC benefits. The federal government funds the other half. However, the federal government provides funding for all of an individual’s SSI benefits. Often, while an SSI application is pending, the SSI applicant is receiving AFDC benefits. When the SSI application is ultimately approved, the federal government sets off any AFDC payments received by that individual during the “disability determination period,” against the first lump-sum SSI payment. This lump-sum SSI payment covers the “disability determination period.” The effect of this practice is to prevent an individual from receiving the benefit of both AFDC and SSI benefits.

Pennsylvania complained that it had paid for approximately fifty percent of the AFDC benefits that an individual with a pending SSI application had received, but that it was precluded from sharing in any recoupment which resulted from the federal government setting off AFDC benefits against the initial lump-sum SSI payment.

The federal government adopted the set off policy challenged in Commonwealth, by interpreting the words “receiving” and “received” in § 602(a)(24) to mean actual receipt by the beneficiary of a benefit check. See note 4, supra. Thus, the Social Security Administration reasoned that it was not required to reimburse Pennsylvania for making AFDC payments to an individual who ultimately became entitled to SSI benefits because such individuals were not actually “receiving” the SSI payments during the time AFDC payments were being made. In light of our prescribed standard of review, we found the SSA’s interpretation of the § 602(a)(24) to be reasonable and, therefore, denied reimbursement to Pennsylvania.

West seeks to distinguish Commonwealth. She notes that the Commonwealth court was construing a different statute than the statute at issue here. Furthermore, West argues, the question in Commonwealth concerned reimbursement to the state and did not concern whether an individual should receive retroactive benefits. While it is true that this court in Commonwealth addressed a different stat*1127ute, and that the issue on appeal did not concern an individual’s claim for benefits, nevertheless, we find that Commonwealth persuasive in analyzing the issue before us today, i.e., whether the USDA’s interpretation of the word “receive” as it appears in § 2012(r), is a reasonable interpretation, and thus entitled to deference.

West argues that USDA is not entitled to significant deference because it has not maintained a consistent interpretation of the word “receives.” See Natural Resources Defense Council v. U.S. Environmental Protection Agency, 683 F.2d 752, 760 (3d Cir.1982) (“sharp changes of agency course constitute ‘danger signals’ to which a reviewing court must be alert.”). Initially, USDA required that food stamp applicants have their first SSI check in hand before they could be deemed eligible for food stamps. Subsequently, USDA relaxed that requirement and did not require the actual receipt of an SSI cheek before an individual could qualify for disability food stamp preferences. In at least three types of circumstances, USDA authorized food stamps where the recipient had not as yet “received” SSI disability checks: (1) where the disability determination had been adjudicated but where disability payments had not been received; (2) where a disability payment for a particular month was not made because of previous disability benefit overpayments; and (3) where retroactive payments were made to “categorically eligible” beneficiaries.

Before us, USDA counters this argument by contending that an agency is entitled to change its mind, that the policy changes delineated by West were minor, and that in any event, those changes in policy favor rather than disfavor the class represented by West. West in turn responds that these changes underscore the arbitrary and capricious nature of USDA’s interpretation and amount to unlawful discrimination against the handicapped under Section 504 of the Rehabilitation Act.5

While it is true that USDA has modified its position in these particulars, we are not persuaded that these policy determinations amount to the type of inconsistent action which must divest the agency of the deference to which it is normally entitled. In Natural Resources Defense Council v. U.S. Environmental Protection Agency, 683 F.2d 752, 760 (3d Cir.1982), we held that where an agency has sharply changed its substantive policy, a reviewing court must scrutinize the agency’s actions more closely and in doing so, not accord the same deference to the agency’s interpretation of statutes and regulations, as might otherwise be the case. The plaintiffs in Natural Resources challenged the Environmental Protection Agency’s (“EPA”) decision to defer indefinitely the effective date of regulations promulgated pursuant to § 307(b)(1) of the Clean Water Act, 33 U.S. C. § 1317(b)(1). These regulations would have controlled the discharge of toxic pollutants into publicly owned sewage treatment plans. We observed that EPA had “without notice and the opportunity for comment, abrogated rules which had been proposed, which had undergone years of notice and comment procedures, and which had been promulgated, with an effective date, in final form.” We therefore concluded that EPA’s actions were not entitled to full deference. Id.

Here, however, the record does not disclose the sharp reversals of policy by *1128USDA, similar to those we confronted in Natural Resources. Absent such major reformulations of policy, we remain bound to our traditional standard of deference. We, therefore, hold that the Secretary is entitled to the deference owed to him by our standard of review and conclude that his construction of § 2012(r) precluding retroactive food stamp payments is reasonable.6

B.

1.

The first of West’s alternate arguments implicates alleged unlawful discrimination against the disabled. Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 794, provides: “No otherwise qualified individual with handicaps * * * shall solely by reason of his handicap, be excluded from the participation in, the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance * *

First, she claims that the effect of USDA’s policy is to deny disabled individuals retroactive payments of food stamps to which they are entitled. See note 5, supra. At the same time, West asserts that USDA permits nondisabled individuals who are otherwise entitled to food stamps, to receive such retroactive food stamp payments in the event that such payments have been wrongfully withheld or denied. 7 U.S.C. §§ 2020(e)(ll) and 2023(b), see note 5, supra.7

The district court rejected this argument, noting that the distinction of which West complains stems directly from Congress’ choice in defining a disabled individual (for the purpose of receiving food stamps) as an individual who is “receiving” SSI benefits. Thus West, and the members of Class A, have not suffered because of their handicaps. Rather they have been denied retroactive food stamps because Congress has chosen to define their eligibility for benefits in the manner that it did. Thus, West’s argument that disabled and non-disabled individuals are treated differently is flawed because in the case of disabled individuals, no wrongful denial has occurred until a disability determination has been made. See note 5, supra.

2.

West’s second alternative argument raises a due process claim. She argues that the length of time it takes SSA to reach a determination that a person is disabled, amounts to a denial of due process, because no food stamp payments are made during that interval. We need not tarry long on this point as we find no merit to her argument. Congress has chosen SSA to make the necessary disability determinations called for under the statute. We know of no fundamental right mandating the time in which such a determination must be made. As the district court con-*1129eluded, “the method established by Congress in § 2012(r) for determining who is disabled and hence eligible for the food stamp preferences, fully comports with due process and provides Class A’s members with a meaningful opportunity to establish their entitlement.” (A. 56). The process Congress has chosen for making such disability determinations is reviewed under a rational basis test. Clearly, the statutory process invoked by § 2012(r) survives such a review.

C.

Because we hold that the Secretary’s interpretation of § 2012(r) is a reasonable interpretation to which we must defer, and because the alternative arguments advanced by West are arguments best addressed to the legislature and not the courts, we will affirm the judgment of the district court with respect to the Class A claimants. We turn now to the claims which West asserts on behalf of the Class B members.

V.

Pursuant to the Housing Act 42 U.S.C. § 1401, et seq., Public Housing Authorities (PHA’s) operate housing assistance programs under contract with the Department of Housing and Urban Development (HUD). Housing is typically rented to low income residents. The rent paid by a public housing resident covers all of that resident’s housing costs, including utilities, 24 C.F.R. § 960.403(a). Under the Brooke Amendment to the Housing Act, the rent can amount to no more than 30% of a resident’s adjusted gross income. 42 U.S. C. § 1437a(a)(l); 24 C.F.R. § 960.404.

Prior to 1981, the utilities in multi-resi-dent apartment buildings were metered on an aggregate basis, with one meter measuring the utility use of the entire building. Charges for utility use in such a building were included in the rent charged each resident, which as noted, could not exceed 30 percent of a resident’s adjusted gross income.

In 1981, HUD began requiring local PHA’s to install individual utility meters for each unit of public housing so that each resident was billed individually for the utilities consumed. 24 C.F.R. § 965.401-410. Because utility costs are included in the maximum permissible rent allowed by the Brooke Amendment, residents of public housing whose units are individually metered receive “utility reimbursements” from the PHA’s. These reimbursements are calculated on a city-wide average and do not reflect the actual individual expense incurred.8 If these utility reimbursements amount to less than a resident’s contract rent (limited to 30% of income), the reimbursement is credited against the rent and the resident pays the difference. If the utility reimbursements are more than the contract rent, the resident receives another check representing the difference between the rent and the utility reimbursement as a “utility rebate”. Residents must pay their individual utility bills directly to the utility company or they are evicted.

USDA treats the “utility rebate” as income for the purposes of calculating an individual’s food stamp allotment. By doing so, USDA has lowered West’s and the members of Class B’s food stamp benefits. West claims that this action by USDA is contrary to the clear language of the Food Stamp Act. She also claims that treating “utility rebates” as income results in a due process/equal protection violation.

A.

The following example roughly approximates the difference in income and expenses experienced by residents of low income housing under a group metering system and under an individual metering system. The example assumes a monthly utility bill of $50, a monthly “utility reimburse*1130ment” of $50, and a monthly adjusted gross income of $100 with a maximum rent therefore of $80:

Group Metering

Utility Costs -0- (included in rent).

Rent $30.

Total out of pocket expense for Rent + Utilities == $30.

Individual Metering

Utility Costs $50

Rent -0-

Utility

Reimbursement $50

Utility Rebate $20

(The resident pays this with his/her own money).

(Because public housing rent includes utilities and the total of the two cannot exceed 30% of a tenant’s income).

(Average utility costs of residents citywide, this sum is credited against resident’s rent).

(Difference between Utility Reimbursement and the maximum rent + utilities a resident can be charged, i.e., $50 — $30 = 20. This “utility rebate” is received by resident and added to adjusted gross income for purposes of food stamp benefit calculation by USDA).9

Total out of pocket expenses for Rent + Utilities = $30.

B.

As noted earlier, income, for the purposes of the Food Stamp Act, includes “all income from whatever source” with certain exemptions and deductions. 7 U.S. C. § 2014(d). West points to 7 U.S.C. § 2014(d)(ll), as the exemption applicable to utility rebates. That statute exempts from income:

any payments or allowances made under (A) any Federal law for the purpose of providing energy assistance, or (B) any State or local law for the purpose of providing energy assistance, designated by the State or local legislative body authorizing such payments or allowances as energy assistance....

Id. (emphasis added).

The district court examined the language of this statute and concluded that it did not exempt the utility rebates at issue here. The district court decided that in order for a “utility rebate” to be exempted from income, it must be a rebate authorized under a federal law, and that the federal law must be designed to provide energy assistance. In other words, the district court concluded that the purpose of the federal law must be to provide energy assistance.

The district court then turned to the question of whether the Housing Act, under which a “utility rebate” is paid, is a federal law whose purpose it is to provide energy assistance. The district court concluded that the Housing Act was designed to provide housing assistance and not energy assistance, and, therefore, a “utility rebate” did not qualify under this exemption. The district court noted that another district court in South Carolina, in Mitchell v. Block, No. 82-3297-2 (D.S.C. June 22, 1983), had reached the same conclusion, and that if Congress had wanted to simply exempt all energy assistance payments from income it could have so provided. On appeal the USDA adopts the district court’s reading of the statute.

West, of course, reads the statute differently. West argues that the clause “for the purpose of providing energy assistance” modifies the preceding clause” “any payments or allowances.” In essence, West argues that in order for a utility *1131rebate to be exempted from income, it need only: (1) be authorized under a federal law; and (2) be for utilized energy assistance excluded from income under FSA. West reinforces her reading of the statute by noting that in conference. Congress rejected a Senate proposal that would have exempted only those “payments or allowances specifically designated for federal energy assistance by federal law.” H.Rep. 97-377, reprinted at 1981 U.S.Code Cong, and Admin.News 1965, 2314. West quotes the remarks of Rep. Richmond, the primary House sponsor of the bill who stated:

All Federal payments for the purpose of providing energy assistance would continue to be excluded as income, whether or not specifically designated for energy assistance. It is the purpose for which they are given and not their label that governs.

127 Cong.Rec. H9878 (December 16, 1981). West concedes that the impetus for creating this exemption was the creation of federal programs like the Low-Income Home Energy Assistance Program, but West argues, it was the clear intent of Congress, as demonstrated by the language and legislative history, not to restrict the exemption to just these programs.

Given this legislative history, it is our judgment that USDA has unreasonably construed 7 U.S.C. § 2014(d)(ll), and in effect has resurrected the defeated Senate language. In Bethlehem Steel v. E.P.A., this court stated:

While deference is due to the interpretation of a statutory term by the officers or agency charged with its administration ... not all administrative interpretations of regulatory statutes will be accepted. We are constrained by our obligation to “honor the clear meaning of a statute, as revealed by its language, purpose and history.”

651 F.2d 861-68 (3d Cir.1981) (quoting International Brotherhood of Teamsters v. Daniel, 439 U.S. 551, 556 n. 20, 99 S.Ct. 790, 800 n. 20, 58 L.Ed.2d 808 (1979) (citations omitted).

Recent Supreme Court jurisprudence supports our conclusion. In Bowen v. American Hospital Associating, 476 U.S. 610, 106 S.Ct. 2101, 90 L.Ed.2d 584 (1986), the Supreme Court struck down a regulation promulgated under the Rehabilitation Act. The Court stated:

Agency deference has not come so far that we will uphold regulations whenever it is possible to conceive a basis for administrative action. To the contrary, the presumption of regularity afforded an agency in fulfilling its statutory mandate is not equivalent to the minimum rationality a statute must bear in order to withstand analysis under the Due Process Clause.

Id. 106 S.Ct. at 2112.

Our decision in this matter is also supported by the most recent actions of Congress. By way of the Hunger Prevention Act of 1988, Pub.L. 100-435,102 Stat. 1645, Congress has now amended 7 U.S.C. § 2014(d)(ll) so that it now exempts as income:

any payments or allowances made for the purpose of providing energy assistance (A) under any Federal law, or (B) under any State or local laws, designated by the State or local legislative body authorizing such payments or allowances as energy assistance....

The Senate Report accompanying this change in the statute informs us that:

This section would change the order of the language of the Food Stamp Act’s exclusion of energy assistance to clarify that USDA and local agencies do not need to conduct an inquiry into the purpose of a federal statute before excluding federal “payments for the purpose of energy assistance.” The law as now written could be read to require this analysis.
The crucial question should be whether the purpose of the payment is energy assistance, not whether the statute, as a whole, is primarily for energy assistance or includes other human services as well. This change is not intended to change current policy.

S.Rep. 100-397 (June 25, 1988), at 28, 29, reprinted in 1988 United States Code, Con*1132gressional and Admin.News 2239 at 2266, 2267.

The government focuses on the last sentence in the Senate Report quoted above, i.e., “[t]his change is not intended to change current policy,” arguing that if no change in current policy was intended, Congress has in effect ratified USDA’s position of which it had to have been aware. The difficulty with the government’s position is that it ignores the legislative history we have quoted above, as well as the significant change made to § 2014(d)(ll) by the Hunger Prevention Act of 1988 quoted above. Given Congress’ clearly expressed intention, we are satisfied that all payments for energy assistance should be exempted from income when determining eligibility for food stamps.10

Finally, we are guided in our interpretation of the statute by the fact that USDA’s position creates an arbitrary disadvantage for those residents of public housing who by chance reside in an apartment which is individually metered. That circumstance implicates equal protection concerns. It is a long-standing canon of construction that a statute should be read, whenever possible, to avoid constitutional entanglements. See Califano v. Yamasaki, 442 U.S. 682, 693, 99 S.Ct. 2545, 2553, 61 L.Ed.2d 176 (1979). The reading advocated forward by West, avoids the equal protection problem created by USDA’s interpretation.11

VI.

We have held that in deference to USDA’s interpretation of 7 U.S.C. § 2012(r) retroactive food stamp payments are not required. To that extent therefore, the judgment of the district court, dated December 17,1987, in favor of the defendants as it pertains to West and the members of Class A will be affirmed.

We have also held that USDA’s interpretation of 7 U.S.C. § 2014(d)(ll), denying utility rebates as exemptions to income, is an impermissible construction of the statute. To that extent therefore, the judgment of the district court, dated December 17, 1987, in favor of the defendants, as it pertains to West and the members of Class B, will be reversed, and the case remanded to the district court with the direction to enter judgment in favor of West and the members of Class B and for such other proceedings as may be appropriate consistent with this opinion.

Each party will bear its own costs.

. Throughout this opinion we have used the following acronyms: AFDC — Aid to Families with Dependant Children; SSI Supplemental Security Income; SSA — Social Security Administration; USDA — United States Department of Agriculture; and HHS — United States Department of Health and Human Services. Other acronyms and abbreviations will be defined in the text where they are used.

. West filed her original complaint with the district court in August, 1984, seeking review of HHS’s determination that she did not qualify for SSI disability benefits. The district court reversed HHS’s determination and ordered that West should receive disability benefits. As will be discussed in some detail later in this opinion, her eligibility for food stamps is contingent upon her receipt of disability benefits.

. 7 U.S.C. § 2012(r) reads as follows:

"Elderly or disabled member” means a member of a household who—
(1) is sixty years of age or older;
(2) receives supplemental security income benefits under title XVI of the Social Security Act (42 U.S.C. 1381 et seq.), federally or State administered supplemental benefits of the type described in section 1616(a) of the Social Security Act [42 U.S.C. § 1382E(A)] if the Secretary determines that such benefits are conditioned on meeting the disability or blindness criteria used under title XVI of the Social Security Act [42 U.S.C. § 1381 et seq.], or federally or State administered supplemental benefits of the type described in section 212(a) of Public law 93-66 (42 U.S.C. 1382 note);
(3)receives disability or blindness payments under title I, II, X, XIV, or XVI of the Social Security Act [42 U.S.C. §§ 301 et seq., 401 et seq., 1201 et seq., 1351 et seq., 1381 et seq.] or receives disability retirement benefits from a governmental agency because of a disability considered permanent under section 221(i) of the Social Security Act (42 U.S.C. 421(1))_(emphasis added)

. 42 U.S.C. § 602(a)(24) sets forth that a state’s AFDC program must:

provide that if an individual is receiving benefits under subchapter XVI [SSI disability benefits] of this chapter or his costs in a foster family home or child-care institution are covered by the foster care maintenance payments being made to his or her minor parent as provided in section 675(4)(B) of this title, then, for the period for which such benefits are received or such costs are so covered, such individual shall not be regarded as a member of a family for purposes of determining the amount of the benefits of the family under this subchapter and his income and resources shall not be counted as income and resources of a family under this subchapter....

(emphasis added)

. West argues that the unreasonableness of USDA’s interpretation is further underscored by U.S.C. §§ 2020(e)(ll) and 2023(b). Both of these provisions provide for retroactive food stamps when food stamps have been "wrongfully withheld" or "wrongfully denied.” The restoration of these benefits is limited to one year. One court has read these statutory provisions as requiring retroactive payments of lost benefits. Klaips v. Bergland, 715 F.2d 477, 484 (10th Cir.1983) (“In fact, the Food Stamp Act itself requires such restoration of benefits both by the courts,, 7 U.S.C. § 2023(b), and by state agencies which administer the food stamp program, 7 U.S.C. § 2020(e)(ll).") West does not argue that these provisions are directly controlling, but indicates that they should guide the proper interpretation of the word "receives.” We do not agree. The terms of the statute dictate that eligibility for disability food stamp preferences is contingent upon a determination that the applicant is entitled to disability benefits. Thus, prior to such a disability determination, no food stamps could have been "wrongfully withheld” or “wrongfully denied."

. West has directed our attention to a recent opinion of the Sixth Circuit. In Lynch v. Lyng, 872 F.2d 718 (1989), the Sixth Circuit held that the Secretary of Agriculture’s regulations implementing the definition of the term "disabled” contained in 7 U.S.C. § 2012(r), could not be upheld because the regulations impermissibly varied from the statute. The regulations established an effective date for the recalculation of benefits, but that date extended several months beyond the explicit effective date contained in the statute. The effect of the holding in Lynch, therefore, was to award retroactive benefits to the members of the plaintiffs class.

While the Lynch case does award retroactive food stamp benefits, neither the analysis nor the holding of Lynch has any bearing on the instant case. Lynch, as noted, is primarily concerned with the variance between the effective date of the statute and the effective date of the implementing regulations. On the other hand, in this case we address the issue of whether the Secretary must award retroactive benefits for the period of time that an application is under consideration. This issue calls for us to address the meaning of § 2012(r), not its effective date. Indeed, the effective dates of the regulations and the statutes relevant to the instant appeal have not been challenged.

. West also argues that because SSA treats certain disabilities like mental illness, more stringently than other disabilities, the effect of disabled applicants. The district court rejected this argument as an argument applicable to a subclass of Class A members. In doing so, it is noted that West had consistently sought relief for all members of Class A without reference to subclasses. We agree with the district court’s reasoning and holding on this point.

. Apparently the policy behind flat rate reimbursements was designed to encourage residents to conserve energy so that if a resident spends less than the flat rate reimbursement, the difference may be pocketed. However, a resident residing in an apartment with poor insulation, or a more expensive than average heating system, may end up losing money under this system.

. West stated that her rent approximates $53 per month. That rental indicates a monthly adjusted gross income of about $177. She has been assigned a utility reimbursement of $152 per month even though her actual utility bills range up to $154 per month. Under the statute, therefore, West pays no rent and receives a utility rebate check each month in the amount of $99 ($152 minus $53). It is this $99 per month which USDA now credits to her as additional income in calculating her food stamp benefits.

. Even if one accepts USDA’s interpretation, that the payments must be made under a federal statute which has the purpose of providing energy assistance, we believe that USDA's interpretation is still untenable. USDA concedes that the purpose of the Housing Act is to provide decent and affordable housing for low income families. To further that end, utility costs have always been included as part of a resident’s rent. Obviously, if a resident does not have heat, hot water, and electricity, he or she cannot be said to have decent and affordable housing. Thus, common sense, logic, and reason dictate that the purpose of the Housing Act was to do more than just provide minimal housing, and that one of the purposes of the Act was to provide low income residents with utilities or "energy assistance."

. West puts forward a number of other bases for reversing the district court. Because of our disposition above, we need not address these other arguments.