703.10 Good Faith Effort to Sell

 

A. General Information

 

1. If the customer is ineligible solely due to ownership of a non-liquid resource, the customer may request conditional exclusion of the resource by signing an Agreement to Sell Property (DE-165) and demonstrating reasonable efforts to sell the resource.

 

2. If the resource is jointly owned by the customer and spouse, both owners must sign the Agreement To Sell Property.

 

3. The proceeds from the sale are a conversion of a resource in the month of the sale and the conditional exclusion terminates.

 

4. More than one non-liquid resource may be conditionally excluded, but a separate Agreement To Sell Property (DE-165) is required for each resource and reasonable efforts to sell must be evaluated separately for each conditionally excluded resource.

 


 

B. Definition of Non-Liquid Resources

 

Non-liquid resources are any resources, which are not in the form of cash or in any other form, which cannot be converted to cash within 20 workdays. Workdays are all days other than Saturdays, Sundays and Federal holidays.

 

Assume that the following resources are non-liquid unless there is evidence to the contrary: vehicles, buildings, land and other real property rights, non-cash business property, machinery and livestock. Evidence to the contrary is limited to firm evidence volunteered by the customer that one of the aforementioned resource types is liquid (i.e. its sale has been accomplished or arranged within 20 workdays).

 

NOTE: This conditional exclusion cannot be applied to non-liquid property which is titled to a trust unless there is no one who has the legal ability (a durable power of attorney or a conservatorship) to sell the property if it is removed from the trust. This could occur, for example, when the trust beneficiary is incompetent and the trustee does not have the legal ability to sell the property if it is removed from the trust.

 


 

C. Criteria for the Conditional Exclusion for an Applicant

 

Non-liquid resources may be conditionally excluded if both of the following conditions are met:

 

1. Except for the excessive non-liquid resource(s), the customer is otherwise eligible for benefits; and

 

2. The customer (or a representative legally empowered to sell property on his behalf) and all other owners sign a DE-165 agreeing to sell the excess non-liquid resource(s). Legal authority of a representative must be verified and documented in the case record.

 

The Power of Attorney on the reverse of the Agreement to Sell Property (DE-165) is not required when the customer’s legal representative signs the agreement.

 

When the agreement is signed by the customer, the customer must appoint an agent (POA) to carry out the terms of the agreement when the customer becomes disabled, incapacitated or is unable to personally fulfill the terms of the agreement. The customer’s appointment of an agent must be witnessed by someone other than the agent, the agent’s spouse or the agent’s children. The signatures of the customer and the witness must be notarized. The agent must sign the Acceptance of Power of Attorney, but the agent’s signature does not need to be notarized.

 

A DE-165 must be completed even if the customer can verify that reasonable efforts to sell the property began prior to the application date.

 


 

D. When to Apply the Conditional Exclusion

 

The conditional exclusion shall be applied the earlier of the following:

 

1. The budget month in which the customer (and other owner(s), if applicable) sign the Agreement to Sell Property (DE-165); or

 

2. The month in which the customer began reasonable continuous efforts to sell the resource, when efforts began prior to the date the DE-165 was signed. The customer must provide verification of the date reasonable efforts began, the type(s) of reasonable efforts made, and evidence that efforts to sell the property were maintained throughout the period prior to signing the DE-165. The customer must establish good cause for any lapse in reasonable efforts to sell that exceeds one week. See MS 703.10.H for good cause criteria.

 


 

E. Reasonable Efforts to Sell

 

The customer must take all necessary steps to sell the resource through media serving the geographic area in which the customer lives; or if different, where the resource is located. Reasonable efforts include all of the following:

 

1. Within 30 days of receiving notice that AHCCCS has accepted the customer‘s signed written agreement to dispose of the property, and absent good cause for not doing so, the customer must:

  1. List the property with an agent; or begin to advertise it in at least one of the appropriate media;

  2. Place a “For Sale” sign on the property (if permitted);

  3. Begin to conduct open houses or otherwise show the property to interested parties on a continuing basis; or

  4. Attempt other appropriate methods such as posting notices on community bulletin boards or distributing fliers.

 

2. Except for gaps of not more than one week, the customer must maintain efforts to sell the property by listing it with an agent or by undertaking to sell it himself;

 

3. Sell the property for as much as possible;

 

4. Ask no more than the highest CMV estimated by a knowledgeable disinterested third party;

 

5. Accept any reasonable offer to buy the property. An offer is reasonable if it is at least two-thirds of the estimated CMV unless the owner proves otherwise. The burden of proof rests on the owner to demonstrate that a rejected offer was not reasonable.

 


 

F. Acceptance of the DE-165 Agreement

 

1. When the customer signs the DE-165, the Power of Attorney and Acceptance of Power of Attorney sections must be completed according to the instructions on the form in order to apply the conditional exclusion. When a DE-165 is completed during the application process, the customer must be notified of acceptance or non-acceptance of the agreement when eligibility is approved.

  1. When an applicant’s approval for AHCCCS benefits is based on the conditional exclusion of non-liquid resources, the customer must be notified in writing that the agency has accepted the agreement.

  2. If the customer is resource eligible without the conditional exclusion, the customer must be advised that the agreement was not accepted.

  3. Complete the acceptance of agreement section of the DE-165 no later than the date the approval is dispositioned in ACE.

  4. On the day the approval is dispositioned, mail a copy of the DE-165 to each owner who signed the agreement and to the agent appointed as the Power of Attorney (if applicable).

 

2. The date of acceptance is 5 days from date the local office signs and mails the acceptance agreement unless the customer shows us that he/she did not receive it within the 5-day period. If the copy of the DE-165 verifying agency acceptance is handed to the client, the date of acceptance is that date. If the customer is also notified of the acceptance by phone, document the verbal notification date on the Case Recordings (DE-114).

 

3. Do not accept the agreement before approving the customer for benefits.

 

4 Time frames for ongoing verification of the customer’s efforts to sell the resource are based on the agreement acceptance date.

 


 

G. Verification of Continuous Reasonable Efforts to Sell

 

1. Monitoring

 

Set a manual alert to contact the customer 35 days after the date the acceptance agreement section of the DE-165 is signed by the agency and every two months thereafter to obtain verification of continuous reasonable efforts to sell.

 

2. Obtain the customer’s Statement

 

Contact the customer by telephone and document in the case recordings the customer’s allegations concerning efforts to sell the resource, offers to buy the resource since the prior contact, and allegations of good cause in the absence of continuous reasonable efforts to sell.

 

3. Verification

 

Verification of reasonable efforts to sell the resource may include the following:

 

  1. Copies of listing agreements with real estate agencies;

  2. Collateral contacts with a real estate agency during the contract period specified in the listing agreement;

  3. Dated advertisements indicating the resource is for sale;

  4. Contracts with media to advertise the resource for sale;

  5. A photograph of the “For Sale” sign on the resource;

  6. Copies of fliers or posted notices;

  7. Any other evidence of reasonable efforts to sell the resource.

 


 

H. Good Cause For Not Maintaining Continuous Efforts to Sell

 

The customer must be given opportunity to provide verification of good cause for not maintaining continuous efforts to sell the resource. Good cause exists when circumstances beyond the individual’s control prevent him from taking the required actions to accomplish reasonable efforts to sell.

 

For example, good cause exists when the customer halts efforts to sell based on acceptance of a legitimate or apparently legitimate offer to buy the property, but the prospective buyer subsequently cannot or will not complete the purchase.

 


 

I. Failure to Establish Good Cause

 

If there is a gap of more than one week in the customer’s efforts to sell the resource and the customer is unable to verify good cause, the conditional exclusion of the resource no longer applies. Value the resource according to the policy for the resource type.

 

If the loss of the conditional exclusion results in ineligibility for AHCCCS medical benefits, the customer must verify he has resumed reasonable efforts to sell before the conditional exclusion can again be applied. The conditional exclusion may be reapplied in the month following the month in which reasonable efforts to sell are resumed.

 


 

J. Termination of the Conditional Exclusion

 

The conditional exclusion ends at the earliest of the following times:

 

1. Sale of the resource;

 

2. Lack of continued reasonable efforts to sell;

 

3. The customer’s written request for cancellation of the agreement;

 

4. The sum of the customer’s countable resources plus the value of the conditionally excluded resource, falls below the resource limit.