FILED
United States Court of Appeals
Tenth Circuit

SEP 16 1999

PATRICK FISHER
Clerk

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

MAXINE ALLRED HENNINGSON,

		Petitioner,

v.

DIRECTOR, OFFICE OF WORKERS’ COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR,

		Respondent.	

No.  98-9531
Petition for Review
(No. 529-24-8650)

ORDER AND JUDGMENT*

Before BRORBY, EBEL, and BRISCOE, Circuit Judges.

	After examining the briefs and appellate record, this panel has determined unanimously to grant the parties’ request for a decision on the briefs without oral argument.  See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G).  The case is therefore ordered submitted without oral argument.
	Petitioner Maxine Allred Henningson seeks review of the final decision by the United States Department of Labor Benefits Review Board (Board) denying her request for waiver of recovery of overpaid black lung benefits.  We have jurisdiction under 33 U.S.C. § 921(c), as made applicable by 30 U.S.C. § 932(a).  Because the Board’s decision is supported by substantial evidence and no legal errors occurred, we affirm.
	Petitioner, the surviving widow of a coal miner, filed a claim for black lung benefits pursuant to 30 U.S.C. § 923.  In 1981, her claim was administratively approved, and petitioner began receiving benefits.  The mine operator requested and received a hearing before an administrative law judge (ALJ) who reversed the initial decision and denied petitioner’s claim for benefits.  Petitioner did not appeal, and her benefits were terminated in 1985.
	In April 1988, petitioner was notified that she must repay the $16,389.90 she received as black lung benefits.  Her request for waiver of recovery of the overpayment was denied administratively.  At a hearing before an ALJ, petitioner and her new husband testified about their financial situation.  In November 1990, the ALJ granted petitioner a waiver of repayment pursuant to 20 C.F.R. § 725.542(b)(2), finding that petitioner was without fault in creating the overpayment and that its recovery would be against equity and good conscience.  The ALJ determined that petitioner had used the benefits to purchase two rental properties, and that this purchase constituted a change for the worse because the ensuing collapse of the local economy depressed the value of the houses.
	In March 1993, the Board reversed the ALJ’s decision, holding the ALJ erred in disallowing recovery of the overpayment based on the outcome of petitioner’s speculative investment.  The Board remanded the case for the ALJ to consider whether petitioner met the other prong of the waiver inquiry, that is, whether recovery of the overpayment would defeat the purposes of the Act.  See id., 725.542(b)(1).
	On remand, the ALJ considered the evidence submitted in 1990 to estimate petitioner’s and her husband’s monthly income and expenses, concluding that recovery of the overpayment would defeat the purposes of the Act.  In May 1995, the Board again reversed the ALJ’s decision, finding the ALJ’s estimates too speculative, and disagreeing with some of his calculations.  The Board also vacated its earlier reversal of the ALJ’s “against equity and good conscience” standard, directing him to reconsider waiver under this prong in light of the Tenth Circuit’s recent opinion in McConnell v. Director, Office of Workers’ Compensation Programs, U.S. Dep’t of Labor, 993 F.2d 1454 (10th Cir. 1993).
	On the second remand, the ALJ reopened the record to obtain updated financial information from petitioner.  Applying McConnell, the ALJ concluded that although petitioner changed her position in reliance of receipt of the benefits, the change could not be classified as a change for the worse, and thus recoupment would not be against equity and good conscience.  He found, however, that requiring petitioner to sell her real estate assets to repay the benefits would defeat the purposes of the Act because it would diminish her income below the level needed to meet her expenses, and that her intended modifications to her house to make it wheelchair accessible would either use up her savings or require the sale of property.  The ALJ again granted petitioner a waiver of the repayment.
	In January 1997, the Board vacated the ALJ’s decision, holding he had not accurately assessed petitioner’s financial condition because he did not consider the entire financial resources of her household, and because he considered speculative future expenses rather than the current expenses in the record.  The Board again directed the ALJ to consider whether recovery was against equity and good conscience because petitioner had changed her position for the worse in reliance on black lung benefits.
	In June 1997, the ALJ denied petitioner’s request for waiver, finding that the two non-income producing houses could be sold without reducing her household income below the level required for current living expenses.  The ALJ also found that petitioner had not changed her position for the worse in reliance on the black lung benefits because the properties purchased with such benefits had retained sufficient value and generated enough income over the years.  The Board affirmed, holding the decision was supported by substantial evidence and was legally correct.
	We review the Board’s decision to determine whether it erred in concluding that the ALJ’s decision denying waiver was supported by substantial evidence and made in accordance with applicable law.  See McConnell, 993 F.3d at 1457.  The petitioner bears the burden of establishing entitlement to waiver under the regulations.  See id. 
	Title IV of the Federal Coal Mine Health and Safety Act of 1969 (the Act), as amended by the Black Lung Benefits Act of 1972, 30 U.S.C. §§ 901-945, requires employers to compensate miners and their families for a miner’s affliction with pneumoconiosis.  The Act provides for interim payments by the Black Lung Disability Trust Fund pending final resolution of the claim.  Section 413 of the Act, 30 U.S.C. § 923(b), authorizes the Department of Labor to recover erroneous payments from this fund, subject to the Social Security overpayment provisions of 42 U.S.C. § 404, which prohibit recovery of overpayments from recipients who are without fault, if the recovery “would defeat the purpose of [title II of the Social Security Act] or would be against equity and good conscience.”  See also 20 C.F.R. § 410.561a (same criteria for recovery of benefits under title IV of the Act).
	These criteria have been defined by regulation in 20 C.F.R. §§ 410.561c and 410.561d.  Section 410.561c defines “defeat the purpose of title IV” as “to deprive a person of income required for ordinary and necessary living expenses,” and § 410.561d defines “against equity and good conscience” to mean that a recipient, because of the payment, has either “relinquished a valuable right” or “changed his position for the worse” on account of the benefits. 
	Petitioner first argues that the Board misapplied § 410.561c(b) by considering all of her assets, rather than just her current income and expenses, in determining whether recovery of the overpayment would defeat the purposes of the Act.  A reading of the regulation supports the Board’s interpretation.  Section 410.561c(a) states the general rule that a determination whether recovery defeats the purpose of the Act “depends upon whether the person has an income or financial resources sufficient for more than ordinary and necessary needs.” (emphasis added)  The decision maker is therefore directed to consider a recipient’s entire financial situation, including resources other than income, in determining whether to waive recovery of an overpayment.  Under this analysis, petitioner has sufficient assets such that recovery of the overpayment would not defeat the purpose of title IV.  See Attachment A to Claimant’s Response to Order Dated April 18, 1996.
	Subsection (b) does not affect this analysis.  Although the subsection directs that recovery of an overpayment defeats the purpose of title IV when the recipient “needs substantially all of his current income (including black lung benefits) to meet current ordinary and necessary living expenses,” this does not apply to petitioner because she has other resources that can be used to meet her expenses.  She therefore does not “need” her current income to meet her expenses, although she would prefer not to liquidate her assets for this purpose.
	Support for this conclusion can be found in several places.  In a 1983 ruling, the Social Security Appeals Council interpreted identical language under title II to hold that a recipient with substantial savings and equity in real estate “had sufficient means to make [a] refund without depriving herself of income necessary to meet her living expenses.”  Soc. Sec. Rul. 83-3a.  The Appeals Council also noted that recovery of the overpayment would not deplete the recipient’s resources below $5,000, indicating this was the threshold figure to determine whether recovery would pose an undue hardship.
	In addition, the Social Security Administration’s Program Operations Manual System (POMS), containing the Commissioner’s interpretation of the Social Security Act and regulations, explains that “[r]ecovery will defeat the purpose of title II to the extent that the person . . . [n]eeds substantially all current income to meet ordinary and necessary living expenses and recovery would reduce assess below [$3,000 for person with no dependents],” POMS GN 02250.100(A), and directs the Administration to “[c]onsider a person’s financial situation, comparing the person’s income and resource to ordinary and necessary expenses,” id., GN 02250.100(B).  To implement the regulation, the POMS directs that 
A person’s entire financial situation must be evaluated when making a defeat the purpose finding.  Defeat the purpose may be found if recovery reduces assets to below:

-  $3000 for a person without dependents . . . .

Assets are available to repay an overpayment to the extent that their total value exceeds the above amounts.  If income does not exceed adjusted expenses, recovery will defeat the purpose if recovery would cause assets to be reduced below these amounts.

POMS GN 02250.115(A)(4).  Although the POMS is not legally binding, see Schweiker v. Hansen, 450 U.S. 785, 789 (1981), we give controlling weight to the agency’s interpretation of its own regulation unless it is arbitrary, capricious, or contrary to law, see McNamar v. Apfel, 172 F.3d 764, 766 (10th Cir. 1999). 
	Finally, the only circuit addressing this issue has held that a recipient’s entire financial picture must be considered, including his or her assets, to determine whether recovery of an overpayment defeats the purpose of the benefits statute.  See Banuelos v. Apfel, 165 F.3d 1166, 1171 (7th Cir. 1999); Milton v. Harris, 616 F.2d 968, 974 (7th Cir. 1980). 
	Petitioner argues also that recovery would be against equity and good conscience because the housing market fell after she purchased the rental properties and that the ALJ’s initial grant of a waiver should be upheld on this basis.  We do not review the ALJ’s initial decision, however, because it has been superseded by his later decision denying waiver.  The ALJ’s final determination that petitioner did not change her position for the worse was based on recent financial information reflecting the current value of the rental properties.  See Attachment A to Claimant’s Response to Order Dated April 18, 1996.  Because this information did not establish a change for the worse, the Board properly found that the ALJ’s decision was supported by substantial evidence.
	Petitioner argues also that this court should reject the narrow interpretation of the phrase “against equity and good conscience” set forth in the regulations, citing Quinlivan v. Sullivan, 916 F.2d 524, 526-27 (9th Cir. 1990), and Groseclose v. Bowen, 809 F.2d 502, 505-06 (8th Cir. 1987).  Those cases presented unusual circumstances, however, which merited the courts’ rejection of a narrow standard.  The circumstances in this case, where the petitioner’s and her husband’s incomes satisfy their monthly expenses without affecting their approximately $142,000 in assets, do not require such a broad interpretation of the phrase “against equity and good conscience.”
	The decision of the United States Department of Labor Benefits Review Board is AFFIRMED.

				Entered for the Court

				Mary Beck Briscoe
				Circuit Judge