Galaviz v. ades/azdes

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

DAVID GALAVIZ, Appellant,

v.

ARIZONA DEPARTMENT OF ECONOMIC SECURITY, an Agency, and
DDD ARIZONA DES, Appellees.

No. 1 CA-UB 17-0167
FILED 12-21-2017

Appeal from the A.D.E.S. Appeals Board
No. P-1435466-001-BR

AFFIRMED

COUNSEL

David Galaviz, Phoenix
Appellant

Arizona Attorney General’s Office, Phoenix
By Carol A. Salvati
Counsel for Appellee Arizona Department of Economic Security

MEMORANDUM DECISION

Presiding Judge Lawrence F. Winthrop delivered the decision of the Court,
in which Judge Diane M. Johnsen and Judge Maria Elena Cruz joined.
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Decision of the Court

W I N T H R O P, Presiding Judge:

¶1 David Galaviz appeals a final decision of the Arizona
Department of Economic Security (“ADES” or “the Department”) requiring
him to repay $293 in Supplemental Nutrition Assistance Program
(“SNAP”)1 benefits erroneously issued to him. For the following reasons,
we affirm.

FACTS AND PROCEDURAL HISTORY

¶2 In September 2013, Galaviz applied for SNAP benefits with
ADES. In his written application and again, during interviews with two
ADES workers who reviewed the application, Galaviz disclosed that he had
a felony drug conviction and had recently been released from incarceration.
He also provided ADES with a copy of his judgment of conviction and
sentencing order.

¶3 Although Galaviz’ felony drug conviction presumably
rendered him ineligible to receive SNAP benefits,2 ADES preliminarily
approved SNAP benefits on an expedited basis. See 7 U.S.C. § 2020(e)(9)
(2012). In September 2013, Galaviz received $93 in SNAP benefits, and in
October 2013, he received $200 in SNAP benefits. After verifying that
Galaviz had a 2009 felony drug conviction for possession of narcotic drugs
for sale, however, ADES concluded Galaviz was ineligible and stopped
providing SNAP benefits.

¶4 On January 15, 2014, ADES sent Galaviz a Notice for
Repayment of a Nutrition Assistance Overpayment, stating that he had

1 SNAP is the Food Stamp Program’s successor. See Food and Nutrition
Act of 2008, 7 U.S.C. §§ 2011 to 2036(b) (2012). The federal government and
state agencies jointly administer SNAP. See, e.g., 7 C.F.R. § 273.2(a)
(governing how state agencies operate SNAP programs, including
application processing). ADES determines eligibility for SNAP applicants
in Arizona. See des.az.gov (last visited Dec. 15, 2017).

2 At the time Galaviz applied for SNAP benefits, persons convicted
after August 22, 1996, of a drug-related felony having as an element the
possession, use, or distribution of a defined controlled substance were
categorically ineligible for SNAP benefits in Arizona. See 7 C.F.R.
§ 273.11(m). Effective August 9, 2017, the Arizona Legislature conditionally
modified that ineligibility. See Ariz. Rev. Stat. (“A.R.S.”) § 46-219 (Supp.
2017) (added by 2017 Ariz. Sess. Laws, ch. 323, § 4 (1st Reg. Sess.)).

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been overpaid in the amount of $293 and classifying the overpayment as
agency error. Galaviz timely appealed the notice, prompting a February 26,
2014 evidentiary hearing.

¶5 At the February 26 telephonic hearing, Galaviz acknowledged
having received $293 in SNAP benefits. Consequently, the primary issue
before the administrative law judge (“ALJ”) was whether approval of
Galaviz’ application on an expedited basis exempted him from repaying
the benefits he erroneously received.

¶6 On March 21, 2014, the ALJ, applying 7 C.F.R. §§ 273.11(m)
and 273.18, affirmed the Notice for Repayment of a Nutrition Assistance
Overpayment. The ALJ found Galaviz ineligible for benefits because he
had a disqualifying prior felony drug conviction, and further found Galaviz
liable for the $293 overpayment after concluding that “the Federal
Regulations do not provide an exception from liability for an overpayment
[based on errant approval made on an expedited basis].” On March 31,
2014, Galaviz timely sought review of the ALJ’s decision.

¶7 On June 12, 2014, the ADES Appeals Board affirmed the ALJ’s
decision, concluding Galaviz had been overpaid in the amount of $293 and
was liable for restitution. In explaining its decision, the Appeals Board,
citing 7 C.F.R. § 273.18, noted, “The regulations do not make exception for
cases in which the overpayment was caused by the Department’s error. The
regulations also do not make exception for cases in which the [SNAP]
benefits were issued to the Claimant on an expedited basis, and they do not
provide for the exercise of equitable discretion by the [ALJ].” Galaviz
timely requested review of the Appeals Board’s decision, and on October 2,
2014, the Appeals Board affirmed its decision upon review.

¶8 On October 20, 2014, Galaviz filed a timely application for
appeal to this court with the clerk of the Appeals Board. Due to agency
negligence and/or malfeasance, ADES did not transmit the application for
appeal to this court until February 24, 2017.

¶9 On June 1, 2017, this court granted Galaviz’ application for
appeal and ordered the parties to address (1) whether Galaviz is entitled to
a waiver under A.R.S. § 46-213(B) (2017), and (2) whether ADES should be

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equitably estopped from collecting any overpayment.3 We have
jurisdiction over Galaviz’ appeal pursuant to A.R.S. § 41-1993(B) (2017).

ANALYSIS

¶10 Galaviz argues that he did not misrepresent the fact of his
felony drug conviction, that he was transparent throughout the process,
and that he should not have to repay ADES because ADES’ approval of his
application for SNAP benefits on an expedited basis should exempt him
from repaying the benefits erroneously issued to him.

¶11 We view the evidence in the light most favorable to
upholding the Appeals Board’s decision and will affirm if that decision is
supported by any reasonable interpretation of the record. Baca v. Ariz. Dep’t
of Econ. Sec., 191 Ariz. 43, 45-46 (App. 1997) (citation omitted). However,
we review de novo whether the Appeals Board properly applied the law to
the facts. Bowman v. Ariz. Dep’t of Econ. Sec., 182 Ariz. 543, 545 (App. 1995).

¶12 In this case, Galaviz’ 2009 class two felony drug conviction for
possession of narcotic drugs for sale rendered him ineligible for SNAP
benefits. See 7 C.F.R. § 273.11(m). Further, at the time Galaviz applied for
and received SNAP benefits, the Arizona Legislature had not enacted a
statute exempting individuals domiciled in Arizona from this exclusion.4
Accordingly, Galaviz was ineligible for SNAP benefits.

¶13 Moreover, ADES’ provisional expedited approval of Galaviz’
application for SNAP benefits did not exempt him from repaying the
benefits he received due to agency error. Nothing in the Federal
Regulations requires ADES to provide an exception from liability for an
overpayment under the circumstances present here, even if the agency has
been grossly neglectful in forwarding an application for appeal to this
court. See generally 7 C.F.R. § 273.18. Consequently, Galaviz is responsible
for repaying the $293 in SNAP benefits that he erroneously received.

3 Neither Galaviz, appearing pro se, nor ADES directly addressed
these issues in their briefing.

4 See Maggie McCarty et al., Cong. Research Serv., R42394, Drug
Testing and Crime-Related Restrictions in TANF, SNAP, and Housing Assistance
13 (Nov. 28, 2016), located at https://fas.org/sgp/crs/misc/R42394.pdf.

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Decision of the Court

CONCLUSION

¶14 We affirm the final decision of the ADES Appeals Board.
However, we direct ADES to consider the appropriateness of
compromising all or part of the claim under 7 C.F.R. § 273.18(e)(7), which
provides that a state agency “may compromise a claim or any portion of a
claim if it can be reasonably determined that a household’s economic
circumstances dictate that the claim will not be paid in three years.” See also
A.R.S. § 46-213(B) (“If there are insufficient assets or resources to justify
collection, if the recipient has not obtained assistance or services by
intentional misrepresentation or if the overpayment was due to an error on
the part of the department of economic security, the department may waive
a repayment by the recipient.”); cf. A.R.S. § 23-787 (Supp. 2017) (“If
[employment security] benefits to which a person is not entitled are
received without any fault on the person’s part and if repayment or
deduction from future benefits would be against equity and good
conscience, the department may waive all or a portion of the amount
overpaid.”).

AMY M. WOOD • Clerk of the Court
FILED: AA

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