A recent decision by the NY Appellate Court agrees that an automobile’s equity value, not its fair market value, is the appropriate standard to use when evaluating an automobile as a resource for public assistance eligibility.
The June 21, 2018 ruling by the Appellate Division, Third Department affirmed the Albany County Supreme Court’s decision in Stewart v. Roberts case—Tricia Stewart v. Sam Roberts (Commissioner, New York State Office of Temporary and Disability Assistance)
Tricia Stewart applied for public assistance after losing her job of 10 years at a nursing home. Her application was denied because of the market value of her car. Although the law provides that certain cars below a certain value (currently $12,000) are exempt from being counted as a resource, Ms. Stewart’s car with a market value of $12,113, was over the limit. The law also states that a resource cannot disqualify someone from receiving public assistance if it is not “available.”
Although her car was not exempt because it was over the market value limit, Ms. Stewart owed $13,301 on the car.She was underwater on her car loan and the equity value was negative. She argued it had no countable value as a resource and she should be eligible for public assistance. The Albany County Supreme Court agreed and the Appellate Division affirmed, stating the OTDA’s interpretation to the contrary was “irrational and unreasonable.”
“When I lost my job it was the first time I’d been unemployed and I needed a little help to get back on my feet. It was really frustrating and scary to be denied assistance because of the market value of my car, especially since I was underwater on my car loan. I’m so happy that other people won’t have to go through what I did.”
Most states (38) recognize that a reliable car is necessary to enable people work, and allow welfare recipients to own one car regardless of value. New York State’s rule is archaic and does not recognize the importance of a car to achieving self-sufficiency.
“I am happy New Yorkers like my client Tricia Stewart can now access public assistance when they need it, while keeping their safe reliable transportation and working towards economic security,” said Julie Morse, Attorney at Legal Services of Central New York states.
This decision will have a significant positive impact on those facing hard times, making it possible to keep the asset that is most likely to help them move forward – a reliable car. It also affirms the common sense notion that a car that is worth less than is owed on the loan is not an available asset,” explained Susan Antos, Senior Attorney at Empire Justice Center.
Stewart was represented by Susan Antos, Saima Akhtar and Ray Burke at the Empire Justice Center, and Julie Morse of Legal Services of Central New York.