Apply North Carolina Work First's 27.5% earnings exclusion and $25 minimum payment

changelog.d/fix-10210-nc-work-first-earnings.fixed.md

@@ -0,0 +1 @@
+Exclude children's earnings, SSI recipients' income and 27.5% of other gross earnings from North Carolina Work First countable income, and require a payment of at least $25 a month instead of $25 per household member.

policyengine_us/parameters/gov/states/nc/ncdhhs/tanf/benefit/payment_percentage.yaml

@@ -11,6 +11,6 @@ metadata:
     - title: WORK FIRST | Income and Budgeting (Change No. 04-2023, January 1, 2024)
       href: https://policies.ncdhhs.gov/wp-content/uploads/wf-114_1-2-2024.pdf#page=5
     - title: North Carolina TANF State Plan 2016-2019
-      href: https://www.ncdhhs.gov/documents/files/dss/dcdl/economicservices/efs-wf-29-2015a/download#page=35
+      href: https://www.ncdhhs.gov/documents/files/dss/dcdl/economicservices/efs-wf-29-2015a/download#page=34
     - title: North Carolina TANF State Plan 2019-2022
-      href: https://www.ncdhhs.gov/documents/files/dss/2019-2022-tanf-state-plan-draft/download#page=18
+      href: https://www.ncdhhs.gov/documents/files/dss/publications/acf-approved-2019-2022-tanf-state-plan/download#page=16

policyengine_us/parameters/gov/states/nc/ncdhhs/tanf/eligibility/average_reduced_need_standard_threshold.yaml

@@ -10,3 +10,9 @@ metadata:
   reference:
     - title: WORK FIRST | Income and Budgeting (Change No. 04-2023, January 1, 2024)
       href: https://policies.ncdhhs.gov/wp-content/uploads/wf-114_1-2-2024.pdf#page=5
+    - title: North Carolina TANF State Plan 2022-2025, Financial Rules 8
+      href: https://www.ncdhhs.gov/2022-2025-tanf-state-plan-final-signedpdf/open#page=18
+    - title: North Carolina TANF State Plan FFY 2026-2028, Financial Rules 8
+      href: https://www.ncdhhs.gov/efs-wf-06-2025a2/open#page=19
+    - title: 10A NCAC 71W .0601(a), Issuance of Funds
+      href: http://reports.oah.state.nc.us/ncac/title%2010a%20-%20health%20and%20human%20services/chapter%2071%20-%20adult%20and%20family%20support/subchapter%20w/subchapter%20w%20rules.pdf#page=10

policyengine_us/parameters/gov/states/nc/ncdhhs/tanf/income/earned_income_exclusion_rate.yaml

@@ -0,0 +1,18 @@
+description: North Carolina excludes this share of gross earned income when computing countable income under the Temporary Assistance for Needy Families program.
+
+values:
+  1997-01-01: 0.275
+
+metadata:
+  unit: /1
+  period: year
+  label: North Carolina TANF earned income exclusion rate
+  reference:
+    - title: North Carolina TANF State Plan 2016-2019, Financial Rules 6
+      href: https://www.ncdhhs.gov/documents/files/dss/dcdl/economicservices/efs-wf-29-2015a/download#page=34
+    - title: North Carolina TANF State Plan 2019-2022, Financial Rules 6
+      href: https://www.ncdhhs.gov/documents/files/dss/publications/acf-approved-2019-2022-tanf-state-plan/download#page=16
+    - title: North Carolina TANF State Plan 2022-2025, Financial Rules 6
+      href: https://www.ncdhhs.gov/2022-2025-tanf-state-plan-final-signedpdf/open#page=17
+    - title: North Carolina TANF State Plan FFY 2026-2028, Financial Rules 6
+      href: https://www.ncdhhs.gov/efs-wf-06-2025a2/open#page=18

policyengine_us/tests/policy/baseline/gov/states/nc/ncdhhs/tanf/integration.yaml

@@ -50,7 +50,7 @@
   output:
     nc_tanf: 0
 
-- name: One adult and one child household with $422 monthly income receives $300 per year
+- name: One adult and one child household with $422 monthly income receives $996.30 per year
   period: 2024
   input:
     people:
@@ -68,7 +68,8 @@
         members: [adult1, child1]
         state_code: NC
   output:
-    nc_tanf: 300
+    # Countable earnings: 422 * (1 - 0.275) = 305.95; 0.5 * (472 - 305.95) = 83.025 a month
+    nc_tanf: 83.025 * 12  # 996.30
 
 - name: One adult and two children household with one SSI recipient receives $236 per month
   period: 2024
@@ -93,7 +94,7 @@
   output:
     nc_tanf: 236 * 12
 
-- name: One adult and two children household with $400 monthly income and one SSI recipient receives $36 per month
+- name: One adult and two children household with $400 monthly income and one SSI recipient receives $91 per month
   period: 2024
   input:
     people:
@@ -114,9 +115,10 @@
         members: [adult1, child1, child2]
         state_code: NC
   output:
-    nc_tanf: 36 * 12
+    # Countable earnings: 400 * (1 - 0.275) = 290; 0.5 * (472 - 290) = 91 a month
+    nc_tanf: 91 * 12
 
-- name: One adult and two children household with $400 monthly income and two SSI recipient receives $0 per month
+- name: One adult and two children household with $400 monthly income and two SSI recipient receives $36 per month
   period: 2024
   input:
     people:
@@ -138,9 +140,10 @@
         members: [adult1, child1, child2]
         state_code: NC
   output:
-    nc_tanf: 0
+    # Household size 1. Countable earnings: 400 * (1 - 0.275) = 290; 0.5 * (362 - 290) = 36 a month
+    nc_tanf: 36 * 12
 
-- name: One adult and two children household with $330 monthly income and two SSI recipient receives $16 per month
+- name: One adult and two children household with $330 monthly income and two SSI recipient receives $61.375 per month
   period: 2024
   input:
     people:
@@ -162,9 +165,10 @@
         members: [adult1, child1, child2]
         state_code: NC
   output:
-    nc_tanf: 16 * 12
+    # Countable earnings: 330 * (1 - 0.275) = 239.25; 0.5 * (362 - 239.25) = 61.375 a month
+    nc_tanf: 61.375 * 12  # 736.50
 
-- name: One adult and one child household with income $430 monthly income receives $0 per year
+- name: One adult and one child household with income $430 monthly income receives $961.50 per year
   period: 2024
   input:
     people:
@@ -182,7 +186,8 @@
         members: [adult1, child1]
         state_code: NC
   output:
-    nc_tanf: 0
+    # Countable earnings: 430 * (1 - 0.275) = 311.75; 0.5 * (472 - 311.75) = 80.125 a month
+    nc_tanf: 80.125 * 12  # 961.50
 
 - name: 14 people household including a child with no income receives $6252 per year
   period: 2024
@@ -252,7 +257,7 @@
   output:
     nc_tanf: (1042 - 0) * 0.5 * 12   
 
-- name: 14 people household including a child with $692 monthly income receives $300 per year
+- name: 14 people household including a child with $692 monthly income receives $3,241.80 per year
   period: 2024
   input:
     people:
@@ -318,9 +323,10 @@
         members: [adult1, adult2, adult3, adult4, adult5, adult6, adult7, adult8, adult9, adult10, adult11, adult12, adult13, child1]
         state_code: NC
   output:
-    nc_tanf: (1042 - 692) * 0.5 * 12 
+    # Countable earnings: 692 * (1 - 0.275) = 501.70; 0.5 * (1_042 - 501.70) = 270.15 a month
+    nc_tanf: 270.15 * 12  # 3_241.80
 
-- name: 14 people household including a child with $1000 monthly income receives $0 per year
+- name: 14 people household including a child with $1000 monthly income receives $1,902 per year
   period: 2024
   input:
     people:
@@ -386,4 +392,113 @@
         members: [adult1, adult2, adult3, adult4, adult5, adult6, adult7, adult8, adult9, adult10, adult11, adult12, adult13, child1]
         state_code: NC
   output:
-    nc_tanf: 0
+    # Countable earnings: 1_000 * (1 - 0.275) = 725; 0.5 * (1_042 - 725) = 158.50 a month
+    nc_tanf: 158.5 * 12  # 1_902
+
+- name: Single parent with five children and $598 monthly earnings receives $1,586.70 per year.
+  period: 2026
+  input:
+    people:
+      parent:
+        age: 30
+        employment_income: 7_176
+      child1:
+        age: 15
+      child2:
+        age: 12
+      child3:
+        age: 9
+      child4:
+        age: 6
+      child5:
+        age: 3
+    spm_units:
+      spm_unit:
+        members: [parent, child1, child2, child3, child4, child5]
+    households:
+      household:
+        members: [parent, child1, child2, child3, child4, child5]
+        state_code: NC
+  output:
+    # Countable earnings: 7_176 * (1 - 0.275) = 5_202.60 (433.55 a month)
+    nc_tanf_countable_earned_income: 5_202.6
+    # Need standard for 6: 698 * 12 = 8_376; 8_376 - 5_202.60 = 3_173.40
+    nc_tanf_reduced_need_standard: 3_173.4
+    nc_tanf_income_eligible: true
+    # 0.5 * 3_173.40 = 1_586.70 (132.225 a month)
+    nc_tanf: 1_586.7
+
+- name: Parent with two children and $600 monthly earnings receives $54.50 per month.
+  period: 2026
+  input:
+    people:
+      parent:
+        age: 30
+        employment_income: 7_200
+      child1:
+        age: 8
+      child2:
+        age: 4
+    spm_units:
+      spm_unit:
+        members: [parent, child1, child2]
+    households:
+      household:
+        members: [parent, child1, child2]
+        state_code: NC
+  output:
+    # Countable earnings: 600 * (1 - 0.275) = 435 a month; 0.5 * (544 - 435) = 54.50
+    nc_tanf: 54.5 * 12
+
+- name: Two parents and a child, where the parent with $400 monthly earnings receives SSI, receive $236 per month.
+  period: 2024
+  input:
+    people:
+      parent_a:
+        age: 35
+        employment_income: 400 * 12
+        receives_ssi: true
+      parent_b:
+        age: 35
+      child:
+        age: 5
+    spm_units:
+      spm_unit:
+        members: [parent_a, parent_b, child]
+    households:
+      household:
+        members: [parent_a, parent_b, child]
+        state_code: NC
+  output:
+    # The SSI recipient is not in the household size, and none of their
+    # income is counted (State Plan Financial Rules 3).
+    nc_tanf_household_size: 2
+    nc_tanf_countable_earned_income: 0
+    # Need standard for 2: 472 a month; 0.5 * (472 - 0) = 236 a month
+    nc_tanf: 236 * 12
+
+- name: A parent who receives SSI and $300 monthly child support for a child aged 5 receives $31 per month.
+  period: 2024
+  input:
+    people:
+      parent:
+        age: 35
+        receives_ssi: true
+        child_support_received: 300 * 12
+      child:
+        age: 5
+    spm_units:
+      spm_unit:
+        members: [parent, child]
+        is_tanf_enrolled: false
+    households:
+      household:
+        members: [parent, child]
+        state_code: NC
+  output:
+    # The SSI parent is not in the household size. WF-114 section XII: child
+    # support is the dependent child's income, so the 300 a month counts.
+    nc_tanf_household_size: 1
+    nc_tanf_countable_gross_unearned_income: 3_600
+    # Need standard for 1: 362 a month; 0.5 * (362 - 300) = 31 a month
+    nc_tanf: 31 * 12

policyengine_us/tests/policy/baseline/gov/states/nc/ncdhhs/tanf/nc_tanf_countable_earned_income.yaml

@@ -7,29 +7,99 @@
   output:
     nc_tanf_countable_earned_income: 0
 
-- name: Earned employee income $500, self-employment income $500, $1000 per year
+- name: Earned employee income $500, self-employment income $500, $725 per year
   period: 2024
   input:
     state_code: NC
     employment_income: 500
     self_employment_income: 500
   output:
-    nc_tanf_countable_earned_income: 1_000
+    nc_tanf_countable_earned_income: 725  # 1_000 * (1 - 0.275)
 
-- name: Earned employee income $500, no self-employment income, $500 per year
+- name: Earned employee income $500, no self-employment income, $362.50 per year
   period: 2024
   input:
     state_code: NC
     employment_income: 500
     self_employment_income: 0
   output:
-    nc_tanf_countable_earned_income: 500
+    nc_tanf_countable_earned_income: 362.5  # 500 * (1 - 0.275)
 
-- name: Earned employee income $0, self-employment income $500, $500 per year
+- name: Earned employee income $0, self-employment income $500, $362.50 per year
   period: 2024
   input:
     state_code: NC
     employment_income: 0
     self_employment_income: 500
   output:
-    nc_tanf_countable_earned_income: 500
+    nc_tanf_countable_earned_income: 362.5  # 500 * (1 - 0.275)
+
+- name: A child's earnings are not counted.
+  period: 2024
+  input:
+    people:
+      parent:
+        age: 30
+        employment_income: 6_000
+      child:
+        age: 16
+        employment_income: 3_000
+    spm_units:
+      spm_unit:
+        members: [parent, child]
+    households:
+      household:
+        members: [parent, child]
+        state_code: NC
+  output:
+    # Only the parent's earnings count: 6_000 * (1 - 0.275) = 4_350
+    nc_tanf_countable_earned_income: 4_350
+
+- name: Earnings of an 18-year-old not in high school are counted (PolicyEngine counts every non-SSI member who is not a child).
+  period: 2024
+  input:
+    people:
+      parent:
+        age: 40
+        employment_income: 0
+      adult_child:
+        age: 18
+        employment_income: 3_000
+    spm_units:
+      spm_unit:
+        members: [parent, adult_child]
+    households:
+      household:
+        members: [parent, adult_child]
+        state_code: NC
+  output:
+    # Age 18 is not below the age limit of 18, so PolicyEngine counts the
+    # earnings: 3_000 * (1 - 0.275) = 2_175. This approximates the rule, which
+    # counts parents' income (10A NCAC 71W .0408(a)(1)) and keeps an 18-year-old
+    # in high school as a child (State Plan Non-Financial Eligibility Rules 1).
+    nc_tanf_countable_earned_income: 2_175
+
+- name: An SSI recipient's earnings are not counted, and the other parent's earnings are.
+  period: 2024
+  input:
+    people:
+      parent_a:
+        age: 35
+        employment_income: 4_800
+        receives_ssi: true
+      parent_b:
+        age: 35
+        employment_income: 2_000
+      child:
+        age: 5
+    spm_units:
+      spm_unit:
+        members: [parent_a, parent_b, child]
+    households:
+      household:
+        members: [parent_a, parent_b, child]
+        state_code: NC
+  output:
+    # State Plan Financial Rules 3: the income of SSI recipients is not counted.
+    # Only parent B's earnings count: 2_000 * (1 - 0.275) = 1_450
+    nc_tanf_countable_earned_income: 1_450