(a) Application of poverty income guidelines and State median income estimates. In implementing the income eligibility standards in section 2605(b)(2) of Public Law 97-35 (42 U.S.C. 8624(b)(2)), grantees using the Federal government's official poverty income guidelines and State median income estimates for households as a basis for determining eligibility for assistance shall, by October 1 of each year, or by the beginning of the State fiscal year, whichever is later, adjust their income eligibility criteria so that they are in accord with the most recently published update of the guidelines or estimates. Grantees may adjust their income eligibility criteria to accord with the most recently published revision to the poverty income guidelines or State median income estimates for households at any time between the publication of the revision and the following October 1, or the beginning of the State fiscal year, whichever is later.

(b) Adjustment of annual median income for household size. In order to determine the State median income for households that have other than four individuals, grantees shall adjust the State median income figures (published annually by the Secretary), by the following percentages:

(1) One-person household, 52 percent;

(2) Two-person household, 68 percent;

(3) Three-person household, 84 percent;

(4) Four-person household, 100 percent;

(5) Five-person household, 116 percent;

(6) Six-person household, 132 percent; and

(7) For each additional household member above six persons, add three percentage points to the percentage adjustment for a six-person household.