Keep New Hampshire FANF's recipient earned income disregard at 50%

changelog.d/fix-9984-nh-fanf-recipient-disregard.fixed.md

@@ -0,0 +1 @@
+Use the 50% earned income disregard for New Hampshire FANF recipients from September 2022 onward, per He-W 654.13(e) and FAM 603.01, instead of the 75% Cliff Effect pilot rate, which applied only to pilot participants who started or moved to full-time work.

policyengine_us/parameters/gov/states/nh/dhhs/fanf/income/earned_income_disregard/recipient_rate.yaml

@@ -1,17 +1,22 @@
 description: New Hampshire excludes this share of earnings from countable income for recipients under the Financial Assistance to Needy Families program.
-
+# The Cliff Effect Initiative's 75% (and 100% for high-demand jobs) earned
+# income disregard was a two-year pilot (October 2022 - September 2024) for
+# participants who started or moved to full-time work. It did not amend
+# He-W 654.13(e), which keeps the 50% rate for recipients, and it is not
+# modeled here.
 values:
   1997-02-01: 0.5
-  2022-09-01: 0.75
 
 metadata:
   unit: /1
   period: month
   label: New Hampshire FANF recipient earned income disregard rate
   reference:
+    - title: N.H. Admin. Rules He-W 654.13(e) - Earned Income Disregard for FANF
+      href: https://gc.nh.gov/rules/state_agencies/he-w600.html
     - title: FAM 603.01 - Earned Income Disregards (EID)
+      href: https://www.dhhs.nh.gov/fam_htm/html/603_01_earned_income_disregards_eid_fam.htm
+    - title: FAM 603.01 - Earned Income Disregards (EID), SR 97-03
       href: https://www.dhhs.nh.gov/famar_htm/html/603_01_earned_income_disregards_eid_sr_97-03_02_97_fam_a.htm
     - title: SR 97-03 Dated 02/97 - TANF Implementation
       href: https://www.dhhs.nh.gov/sr_htm/html/sr_97-03_dated_02_97.htm
-    - title: New Hampshire TANF State Plan - Cliff Effect Initiative
-      href: https://www.dhhs.nh.gov/sites/g/files/ehbemt476/files/documents2/tanf-state-plan.pdf#page=29

policyengine_us/tests/policy/baseline/gov/states/nh/dhhs/fanf/integration.yaml

@@ -1,8 +1,8 @@
 # Integration tests for NH FANF (Financial Assistance to Needy Families)
 # Tests the complete benefit calculation pipeline with real-world scenarios
 # Note: Tests default to applicant status (20% earned income disregard)
-# Recipients get 75% disregard per Cliff Effect Initiative (Sept 2022)
-# Sources: RSA 167:77-g; FAM 601; FAM 603; SR 97-03; BFA SR 22-28
+# Recipients get a 50% disregard per He-W 654.13(e)
+# Sources: RSA 167:77-g; He-W 654.13; FAM 601; FAM 603; SR 97-03; BFA SR 22-28
 
 - name: Case 1, single parent with one child, no income, maximum benefit.
   period: 2024-01
@@ -158,7 +158,7 @@
     # 1,560 - 840 = 720
     nh_fanf: 720
 
-- name: Case 7, recipient with 75 percent earned income disregard.
+- name: Case 7, recipient with 50 percent earned income disregard.
   period: 2024-01
   input:
     people:
@@ -177,12 +177,12 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 1,000 * 0.25 = 250
-    nh_fanf_countable_earned_income: 250
-    nh_fanf_countable_income: 250
+    # Recipient: 1,000 * 0.50 = 500
+    nh_fanf_countable_earned_income: 500
+    nh_fanf_countable_income: 500
     nh_fanf_eligible: true
-    # 1,022 - 250 = 772
-    nh_fanf: 772
+    # 1,022 - 500 = 522
+    nh_fanf: 522
 
 - name: Case 8, recipient with higher resource limit.
   period: 2024-01
@@ -227,15 +227,15 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 2,000 * 0.25 = 500
+    # Recipient: 2,000 * 0.50 = 1,000
     # Child care: $200
-    # Countable: 500 - 200 = 300
+    # Countable: 1,000 - 200 = 800
     nh_fanf_child_care_deduction: 200
-    nh_fanf_countable_earned_income: 300
-    nh_fanf_countable_income: 300
+    nh_fanf_countable_earned_income: 800
+    nh_fanf_countable_income: 800
     nh_fanf_eligible: true
-    # 1,022 - 300 = 722
-    nh_fanf: 722
+    # 1,022 - 800 = 222
+    nh_fanf: 222
 
 - name: Case 10, large 8-person household.
   period: 2024-01
@@ -327,9 +327,9 @@
         state_code: NH
   output:
     nh_fanf_payment_standard: 1_291
-    # Recipient: 200 * 0.25 = 50
+    # Recipient: 200 * 0.50 = 100
     # Child care (part-time): 2 * $100 = $200
-    # Countable: max(50 - 200, 0) = 0
+    # Countable: max(100 - 200, 0) = 0
     nh_fanf_child_care_deduction: 200
     nh_fanf_countable_earned_income: 0
     nh_fanf_countable_income: 0
@@ -410,9 +410,65 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 1,000 * 0.25 = 250 (75% disregard)
-    nh_fanf_countable_earned_income: 250
-    nh_fanf_countable_income: 250
+    # Recipient: 1,000 * 0.50 = 500 (50% disregard)
+    nh_fanf_countable_earned_income: 500
+    nh_fanf_countable_income: 500
     nh_fanf_eligible: true
-    # 1,022 - 250 = 772 (vs 222 for applicant - $550 more benefit!)
-    nh_fanf: 772
+    # 1,022 - 500 = 522 (vs 222 for applicant: $300 more benefit)
+    nh_fanf: 522
+
+- name: Case 16, recipient family of three in 2025, 50 percent disregard.
+  period: 2025-01
+  absolute_error_margin: 0.01
+  input:
+    people:
+      person1:
+        age: 30
+        employment_income_before_lsr: 18_000  # $1,500/month
+      person2:
+        age: 5
+      person3:
+        age: 2
+    spm_units:
+      spm_unit:
+        members: [person1, person2, person3]
+        is_tanf_enrolled: true
+    households:
+      household:
+        members: [person1, person2, person3]
+        state_code: NH
+  output:
+    # 60% x $26,650 (2025 FPG for 3) / 12 = $1,332.50
+    nh_fanf_payment_standard: 1_332.50
+    # He-W 654.13(e): 1,500 * 0.50 = 750
+    nh_fanf_countable_earned_income: 750
+    nh_fanf_income_eligible: true
+    # 1,332.50 - 750 = 582.50
+    nh_fanf: 582.50
+
+- name: Case 17, recipient with countable earnings above the payment standard is ineligible.
+  period: 2025-01
+  absolute_error_margin: 0.01
+  input:
+    people:
+      person1:
+        age: 30
+        employment_income_before_lsr: 32_400  # $2,700/month
+      person2:
+        age: 5
+      person3:
+        age: 2
+    spm_units:
+      spm_unit:
+        members: [person1, person2, person3]
+        is_tanf_enrolled: true
+    households:
+      household:
+        members: [person1, person2, person3]
+        state_code: NH
+  output:
+    nh_fanf_payment_standard: 1_332.50
+    # 2,700 * 0.50 = 1,350 > 1,332.50
+    nh_fanf_countable_earned_income: 1_350
+    nh_fanf_income_eligible: false
+    nh_fanf: 0

policyengine_us/tests/policy/baseline/gov/states/nh/dhhs/fanf/nh_fanf_countable_earned_income.yaml

@@ -1,9 +1,11 @@
 # Tests for NH FANF countable earned income
 # NH applies different earned income disregard rates:
 # - Applicants: 20% disregard (keep 80%)
-# - Recipients: 75% disregard (keep 25%) as of Sept 2022 Cliff Effect Initiative
+# - Recipients: 50% disregard (keep 50%), He-W 654.13(e)
+#   (the Cliff Effect Initiative's 75% disregard was a pilot for a subgroup and
+#   is not modeled)
 # Child care deduction is also applied to earned income
-# Source: SR 97-03; FAM 603.01; BFA SR 22-28
+# Source: He-W 654.13; SR 97-03; FAM 603.01; BFA SR 22-28
 
 - name: Case 1, zero earned income.
   period: 2024-01
@@ -22,15 +24,15 @@
     # Applicant: 1,000 * (1 - 0.20) = 800
     nh_fanf_countable_earned_income: 800
 
-- name: Case 3, recipient with earned income, 75 percent disregard.
+- name: Case 3, recipient with earned income, 50 percent disregard.
   period: 2024-01
   input:
     state_code: NH
     is_tanf_enrolled: true
     tanf_gross_earned_income: 1_000
   output:
-    # Recipient: 1,000 * (1 - 0.75) = 250
-    nh_fanf_countable_earned_income: 250
+    # Recipient: 1,000 * (1 - 0.50) = 500
+    nh_fanf_countable_earned_income: 500
 
 - name: Case 4, applicant with child care deduction.
   period: 2024-01
@@ -75,10 +77,10 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 2,000 * (1 - 0.75) = 500
+    # Recipient: 2,000 * (1 - 0.50) = 1,000
     # Child care: $200
-    # Countable: 500 - 200 = 300
-    nh_fanf_countable_earned_income: 300
+    # Countable: 1,000 - 200 = 800
+    nh_fanf_countable_earned_income: 800
 
 - name: Case 6, child care deduction exceeds income, capped at zero.
   period: 2024-01
@@ -99,9 +101,9 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 200 * (1 - 0.75) = 50
+    # Recipient: 200 * (1 - 0.50) = 100
     # Child care (part-time): $100
-    # Countable: max(50 - 100, 0) = 0
+    # Countable: max(100 - 100, 0) = 0
     nh_fanf_countable_earned_income: 0
 
 - name: Case 7, child care deduction exactly equals after-disregard income.
@@ -110,7 +112,7 @@
     people:
       person1:
         age: 30
-        employment_income_before_lsr: 9_600  # $800/month gross
+        employment_income_before_lsr: 4_800  # $400/month gross (full-time)
       person2:
         age: 3
     spm_units:
@@ -123,7 +125,7 @@
         members: [person1, person2]
         state_code: NH
   output:
-    # Recipient: 800 * (1 - 0.75) = 200
+    # Recipient: 400 * (1 - 0.50) = 200
     # Child care (full-time, under 6): $200
     # Countable: 200 - 200 = 0
     nh_fanf_countable_earned_income: 0

policyengine_us/variables/gov/states/nh/dhhs/fanf/income/nh_fanf_countable_earned_income.py

@@ -8,6 +8,7 @@ class nh_fanf_countable_earned_income(Variable):
     unit = USD
     definition_period = MONTH
     reference = (
+        "https://gc.nh.gov/rules/state_agencies/he-w600.html",
         "https://www.dhhs.nh.gov/famar_htm/html/603_01_earned_income_disregards_eid_sr_97-03_02_97_fam_a.htm",
         "https://www.dhhs.nh.gov/sr_htm/html/sr_97-03_dated_02_97.htm",
         "https://www.dhhs.nh.gov/sites/g/files/ehbemt476/files/documents2/tanf-state-plan.pdf#page=29",
@@ -16,10 +17,12 @@ class nh_fanf_countable_earned_income(Variable):
 
     def formula(spm_unit, period, parameters):
         # NH has different disregard rates for applicants (20%) vs recipients
-        # Recipients: 50% (1997) → 75% (Sept 2022 Cliff Effect Initiative)
-        # Note: A 100% disregard exists for high-demand jobs (per NH Workforce
-        # Innovation Opportunities Act board) with medical benefits offered,
-        # but this is not implemented due to lack of job classification data.
+        # (50%), per He-W 654.13(b) and (e).
+        # Note: The Cliff Effect Initiative's two-year pilot (October 2022 to
+        # September 2024) gave a 75% disregard to participants who started or
+        # moved to full-time work, and 100% for high-demand jobs with medical
+        # benefits. It is not implemented, because the inputs do not identify
+        # the pilot group or the job classification.
         p = parameters(period).gov.states.nh.dhhs.fanf.income.earned_income_disregard
         gross_earned = add(spm_unit, period, ["tanf_gross_earned_income"])
         is_enrolled = spm_unit("is_tanf_enrolled", period)