PORTLAND — City officials are grappling with how to get state reimbursement for general assistance to undocumented immigrants while fighting a state policy prohibiting aid to anyone who cannot prove they are in the country legally.

The policy and court strategy were discussed Monday in a City Council workshop and an executive session that lasted about 40 minutes.

The city has until Sept. 30 to file with the state Department of Health and Human Services for reimbursements on general assistance vouchers made in June. The state requires certification there will be no reimbursements for “Non-Citizens who are not qualified for General Assistance as defined by Federal law.”

An attempt to either repeal the DHHS policy, or at least halt it while it goes through a typical state rule-making process that includes public hearings, will be heard in U.S. District Court in Portland by Judge John Woodcock.

Because the state based its decision on a law enacted about 20 years ago, it argues Woodcock should hear the case and decide. The city, which along with Westbrook joined a lawsuit filed by the Maine Municipal Association, wants the case heard in Maine Superior Court and has asked Woodcock to remand the lawsuit to the state court, where it originated in July.

The plaintiffs were joined by immigrants Rehma Rebecca Juma and Suavis Furaha. The state is arguing its case without Attorney General Janet Mills, who declared her opposition to the DHHS policy on June 24.

In announcing the policy in June, DHHS Commissioner Mary Mayhew said it could save the state more than $1 million annually. Acting City Manager Sheila Hill-Christian said Monday the financial stakes are much higher.

General assistance aid administered by the city Health and Human Services Department in the form of vouchers for housing, food, clothing and personal items is budgeted for $10.7 million this year, Hill-Christian said. The state could ultimately reimburse $8.7 million.

Hill-Christian estimated the city grants about $3.6 million annually to “those the state deems ineligible.”

A decision to seek reimbursement of as much as $300,000 for undocumented immigrants would be accompanied by a disclaimer saying the city has tried to follow the policy, but its staff is “not trained in immigration law and cannot state with certainty whether all persons covered by the DHHS guidance are in fact disqualified for benefits” under federal law.

Knowingly granting aid to undocumented immigrants could result in the DHHS ending all reimbursements for general assistance, according to a June 20 letter sent to municipal administrators by Gov. Paul LePage.

If the city does not file for reimbursement by Sept. 30, and decides to wait for the court decision, Hill-Christian said there may not be another chance to obtain reimbursements.

City administrators and councilors in Portland, South Portland and Gorham have said they will continue to provide assistance to undocumented immigrants who are ineligible for federally funded assistance benefits, such as Temporary Assistance to Needy Families, Medicaid, or the Supplemental Nutrition Assistance Program.

Among those affected by shutting off aid are people who have overstayed visas or whose refugee or asylum status has not been settled by federal immigration authorities.

Hill-Christian prepared data for several scenarios, including the entire loss of state reimbursements and how it would affect the city property tax rate and bond ratings.

If the city lost its entire state reimbursement, replacing the funding would add 91 cents to the current tax rate of $20 per $1,000 of assessed value, assuming no other reductions in city staffing or services.  

Additional borrowing to fund the program could lower the city bond rating, Hill-Christian suggested, but city financial adviser Joe Cuetara discounted that possibility because borrowing would be a one-time event while the policy question is settled.

“This could be a non-event,” Cuetara said.

David Harry can be reached at 781-3661 ext. 110 or dharry@theforecaster.net. Follow him on Twitter: @DavidHarry8.