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  • Writer's pictureThe San Juan Daily Star

Supreme Court upholds Puerto Rico’s exclusion from disability benefits

By The Star Staff

The U.S. Congress can prevent people who live in Puerto Rico from participating in a federal program that provides benefits to low-income elderly, blind and disabled people, the Supreme Court ruled on Thursday.

The decision upholds the so-called Insular Cases, a series of court decisions from the early 20th century that validated treating residents in the U.S. territories different from those living in the mainland states.

The justices ruled 8-1 in favor of President Joe Biden’s administration, saying that the decision by Congress decades ago to exclude Puerto Rico from the Supplemental Security Income (SSI) program did not violate a U.S. Constitution mandate that laws apply equally to everyone.

The decision in United States v. Jose Luis Vaello-Madero, means that an estimated 300,000 people in Puerto Rico cannot receive the benefit. The federal government said an expansion to Puerto Rico would have cost $2 billion a year.

The case stems from José Luis Vaello-Madero, a disabled man who fought attempts by the U.S. Social Security administration to revoke his Supplemental Security Income (SSI) benefits after he moved to Puerto Rico. His lawyers said the U.S. government’s move was a “discriminatory” treatment towards the U.S. territory.

Under the litigation, the U.S. government sought to claw back $28,081 in SSI payments that Vaello-Madero had received from the program over a three-year period after he moved back to Puerto Rico from New York in 2013.

The U.S. Department of Justice brought the case to the nation’s top court after a U.S. First Circuit Court of Appeals panel ruled that exclusion of otherwise eligible Americans from SSI based on their residence in Puerto Rico violates the U.S. Constitution equal protection clause.

The U.S. Justice Department argued that Congress can treat Puerto Rico differently solely because of the island’s “unique” status and “unparalleled” relationship with the United States. Officials argued that Puerto Ricans pay less in federal taxes that mainland states.

SSI is available to U.S. citizens residing in the states, the District of Columbia, and in the territory of the Northern Mariana Islands. The U.S. Virgin Islands, Guam, Puerto Rico and American Samoa are excluded from the program. Instead of SSI, Puerto Rico, Guam, and the U.S. Virgin Islands receive supplemental assistance through the Aid to the Aged, Blind, and Disabled Program (AABD) program, a capped grant from the US Department of Health and Human Services that benefited states prior to the establishment of SSI.

Lawyers for Vaello-Madero had argued that although Puerto Rico is a U.S. territory that has been subject to U.S. control for more than 120 years, the people of Puerto Rico have no federal voting power and lack the political power to set their own destiny.

They noted that Congress’s decision to exclude Puerto Rico from SSI solely on the premise that it is outside the United States can be traced directly to a historical desire to single out the people of Puerto Rico for lesser treatment because of their mixed race and Hispanic ancestry.

The lawyers cited precedent in a 1901 case, Downes v. Bidwell, in which a court majority held that there was a distinction between “incorporated” territories, integral to the United States, and so-called “unincorporated” territories that, although “belonging to the United States,” could nevertheless be treated as “foreign to the United States.”

Downes was the first of a series of Supreme Court decisions known as the Insular Cases, from the early 20th century that adopted what became known as the Incorporation Doctrine. That doctrine was founded on the idea that the United States could acquire Spanish territories like Puerto Rico without integrating them into the Union, Vaello-Madero said.

They dismissed the idea that Puerto Rico can be treated differently because Puerto Ricans do not pay federal taxes. Vaello Madero lawyers noted that residents of Puerto Rico not only make substantial contributions to the federal treasury, but in fact have consistently made them in higher amounts than taxpayers in at least six states, as well as the territory of the Northern Mariana Islands. From 1998 up until 2006, when Puerto Rico was hit by its present economic recession, Puerto Rico consistently contributed more than $4 billion annually in federal taxes and impositions.

The top court held Thursday in an opinion by conservative Justice Brett Kavanaugh that the actions of Congress were valid under a provision in the Constitution that lets lawmakers treat territories differently than states. He was referring to the Territory Clause of the Constitution that states that Congress may “make all needful Rules and Regulations respecting the Territory . . . belonging to the United States.”

Kavanaugh said that in exercising that authority, Congress sometimes legislates differently with respect to the Territories, including Puerto Rico, than it does with respect to the States.

“That long standing congressional practice reflects both national and local considerations. In tackling the many facets of territorial governance, Congress must make numerous policy judgments that account not only for the needs of the United States as a whole but also for (among other things) the unique histories, economic conditions, social circumstances, independent policy views, and relative autonomy of the individual Territories. Of relevance here, Congress must decide how to structure federal taxes and benefits for residents of the Territories. In doing so, Congress has long maintained federal tax and benefits programs for residents of Puerto Rico and the other Territories that differ in some respects from the federal tax and benefits programs for residents of the 50 States. On the tax side, for example, residents of Puerto Rico are typically exempt from most federal income, gift, estate, and excise taxes,” he said.

Justice Sonia Sotomayor, whose parents are from Puerto Rico, was the sole dissenter. She argued the ruling went against the whole nature of the SSI program.

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