John Marshall Harlan II

“ We have considered and rejected the argument that a federal court is without power to review state welfare provisions or prohibit the use of federal funds by the States in view of the fact that Congress has lodged in the Department of HEW the power to cut off federal funds for noncompliance with statutory requirements. We are most reluctant to assume Congress has closed the avenue of effective judicial review to those individuals most directly affected by the administration of its program. ”

“ New York is, of course, in no way prohibited from using only state funds according to whatever plan it chooses, providing it violates no provision of the Constitution. It follows, however, from our conclusion that New York's program is incompatible with § 402 (a) (23) , that petitioners are entitled to declaratory relief and an appropriate injunction by the District Court against the payment of federal monies according to the new schedules, should the State not develop a conforming plan within a reasonable period of time. ”

“ Congress has spoken in favor of increases in AFDC payments. While Congress rejected the mandatory adjustment provision in the administration bill, it embodied in legislation the cost-of-living exercise which has both practical and political consequences.
It has the effect of requiring the States to recognize and accept the responsibility for those additional individuals whose income falls short of the standard of need as computed in light of economic realities and to place them among those eligible for the care and training provisions. ”

“ While the application of the statute to the New York program is by no means simple, we think the evidence adduced supports the ultimate finding of the District Court, unquestioned by the Court of Appeals, that New York has, in effect, impermissibly lowered its standard of need by eliminating items that were included prior to the enactment of § 402 (a) (23) . ”

“ First, it is necessary to establish a 'standard of need,' a yardstick for measuring who is eligible for public assistance. Second, it must be decided how much assistance will be given, that is, what 'level of benefits' will be paid. On both scores Congress has always left to the States a great deal of discretion. ”

“ Petitioners answer, we think correctly, that neither the principle of 'exhaustion of administrative remedies' nor the doctrine of 'primary jurisdiction' has any application to the situation before us. Petitioners do not seek review of an administrative order, nor could they have obtained an administrative ruling since HEW has no procedures whereby welfare recipients may trigger and participate in the Department's review of state welfare programs. ”

“ In lieu of individualized grants for 'recurring' needs to be supplemented by special grants or the flat $100 grant, New York adopted a system fixing maximum allowances per family based on the number of individuals per household. The maximum dollar amounts were established by ascertaining ' (t) he mean age of the oldest child in each size family.' See Memorandum of Law in Support of Defendants' Motion for Summary Judgment 9-10. While these family maximums are exclusive of rent and fuel costs the District Court found that ' (s) pecial grants were seemingly not included in these computations. ”

“ A further reason given to support the contention that the District Court should have declined to exercise jurisdiction is that the Department of Health, Education, and Welfare was the appropriate forum, at least in the first instance, for resolution on the merits of the questions before us, and that at the time thi action came to Court HEW was 'engaged in a study of the relationship between Section 602 (a) (23) and Section 131-a.' 414 F.2d, at 176 (opinion of Judge Hays) . ”

“ The prayer in the District Court in Smith v. King, as in the case before us, was for declaratory and injunctive relief against the enforcement of the invalid provision. 277 F.Supp. 31 (D.C.M.D.Ala.1967) . We see no justification in principle for drawing a distinction between invalidating a single nonconforming provision or an entire program. In both circumstances federal funds are being allocated and paid in a manner contrary to that intended by Congress. ”

“ Unlike insubstantiality, which is apparent at the outset, mootness, frequently a matter beyond the control of the parties, may not occur until after substantial time and energy have been expended looking toward the resolution of a dispute that plaintiffs were entitled to bring in a federal court. ”

“ In King the withholding of benefits based on the invalid state regulation resulted in overpayments to some recipients, assuming a constant state welfare budget, and a corresponding misallocation of matching federal resources. In the case before us, noncompliance with § 402 (a) (23) may result in limiting the welfare rolls unduly and thus channeling the matching federal grants in a way not intended by Congress. ”

“ The effect of the new program on upstate cases is less severe, with gains to some families apparently cancelling out losses to others, but the net effect is a drastic reduction in overall payments since New York City recipients compose approximately 72% of the State's welfare clientele. ”