State Analyst Unveils an Alternative Welfare Plan
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SACRAMENTO — In a radical departure from Gov. Pete Wilson’s plan, the Legislature’s analyst proposed a new welfare system for California on Thursday that provides community service jobs for unemployed recipients, requires a state takeover of General Assistance and maintains a minimal safety net for families faced with prolonged joblessness.
Several key Democrats promptly embraced elements of the analyst’s proposal, saying it provides a strong foundation for developing an alternative to the governor’s welfare plan, which relies heavily on the use of punishments and sanctions to propel adult recipients into the workplace.
The nonpartisan analyst’s office said it was offering the plan in an attempt to strike a compromise between three often-contradictory goals--the need to control costs, to provide support for children and to encourage adult recipients to work.
“I think the benefits that you are going to get from this will be to have a lot more people working, and you’re also going to change the approach to welfare in California,” said Elizabeth Hill, director of the office.
The Legislature and the governor are being pressured to restructure the state’s welfare system by a federal law signed in August giving states new flexibility to design and operate their own assistance programs. The final design is expected to come after months of partisan wrangling and compromise.
Although leaders of the Democratic legislative majority responded favorably to the analyst’s proposal, officials in the Wilson administration said they needed more time to study it.
In the Assembly, Human Services Committee Chairwoman Dion Aroner (D-Berkeley) said it provides a basis for lawmakers to begin building their own welfare plan. “It’s a beginning tool for us,” she said.
Sen. Mike Thompson (D-St. Helena) said he expects Democrats will endorse many of its elements, particularly its recommendation for a state takeover of General Assistance, the county aid program that provides cash benefits mostly to single adults.
Thompson, who heads the budget subcommittee that will consider welfare issues, said it is similar to the welfare measure he is sponsoring on behalf of California counties. He said it also meets his concerns that any reform effort must maintain protections for children, the aged, blind and disabled and must not create new financial burdens for beleaguered county governments.
Assembly Speaker Cruz Bustamante (D-Fresno) and Senate President Pro Tem Bill Lockyer (D-Hayward) were still reviewing the plan Thursday, but Lockyer said it is a “a good plan” to help set the course for welfare reform.
Janice Ploeger Glaab, spokeswoman for Wilson’s Health and Welfare Agency, said the administration will look closely at the costs of the proposals. She said officials are concerned that proposals for subsidized employment, as well as the state takeover of General Assistance, can be “very expensive alternatives.”
In the first four years, the analyst’s plan requires the state to invest hundreds of millions of additional dollars in the new welfare program. Hill said that it will not be until the middle of the fifth year that its work incentives begin to pay off with substantial savings.
In the first two years, the proposal requires an additional state investment of $750 million, but it ultimately produces savings of an estimated $1 billion over a seven-year period. Counties would reap $890 million of the savings while about $200 million would accrue to the state.
Wilson’s plan provided millions of dollars in savings in the first few years, but some local officials contended it would impose staggering new costs on counties as they were left to pick up the burden of providing for those losing eligibility for state and federal aid.
Hill conceded that the analyst’s proposal costs more than the governor’s but said it would take more analysis before an actual dollar for dollar comparison could be made.
“Our program is more expensive than what the governor is proposing, [but] it clearly has more services,” she said. “The benefit is you get a lot more people working.”
A key difference between the two proposals is the analyst’s recommendations for dealing with work requirements. After two years, if able-bodied adult recipients are not working at least 20 hours a week, it requires them to be employed in government-subsidized community service jobs.
Hill said she anticipates that about 93,000 community service jobs would need to be created in the first year that the provision is put into effect. Under the analyst’s plan, recipients would be paid minimum wages, making them eligible for a lump-sum payment under the federal earned income tax credit program.
The governor’s plan called for recipients already on welfare to lose all cash aid after two years if they are not working. However, their children would be eligible for noncash assistance. Newcomers to the welfare system would have only 12 months to find work, or lose their aid.
The governor’s plan also provided for a 15% reduction in benefits after six months if adults in families do not find jobs.
Under the analyst’s plan, welfare families would not lose benefits until they have been on aid for five years and failed to find work in non-subsidized jobs. Even then, the plan allows them to continue getting cash assistance but at levels that are about a third lower than what they had been receiving.
In its 42-page report to the Legislature, the analyst’s office noted that the new federal legislation puts a five-year lifetime limit on aid that is financed with federal dollars. But it said the federal government had put no restrictions on the use of state dollars, so state governments could opt to use their own resources to continue cash benefits after five years.
It said it had recommended that cash benefits be continued in an attempt “to strike a balance between maintaining some of the behavioral effects associated with time limits . . . while recognizing the importance of providing some support for needy families.”
Casey McKeever, directing attorney for the Western Center on Law & Poverty, an advocacy group for poor people, called the analyst’s proposal “a more realistic approach” to welfare reform than Wilson’s.
“It does recognize a continuing need for a safety net however much emphasis is given to helping people find work,” he said.
As part of its proposal, the analyst also suggested that most of the responsibility for General Assistance be taken over by the state and melded with an existing state program that provides assistance for families.
But it said the work requirements for those on General Assistance, most of whom are single adults, should be stricter than for adults in families. After two years, General Assistance recipients who are not working would lose aid altogether.
Because of the administrative difficulties, the analyst said its conversion of General Assistance to a state program should be put off for at least three years.
Once it becomes a state program, the analyst proposed that a uniform statewide cash grant--roughly $225 a month--be established.
General Assistance grants now vary from county to county and range from $175 to $345 for each recipient. In Los Angeles County, which has 60% of the General Assistance caseload, the maximum rate is $212 a month.
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Welfare Plan Comparison
This month Gov. Pete Wilson unveiled his plan for California’s new welfare system. On Thursday, the Legislature’s nonpartisan analyst proposed another approach. Here are basic elements of current law, Wilson’s plan and recommendations by the Legislative Analyst’s Office (LAO):
GENERAL ASSISTANCE
Current Law: Counties mandated by state law to act as a safety net of last resort and provide General Assistance for the poor who are not eligible for other cash aid. Grant levels vary by county.
Wilson Plan: Eliminate the mandate that counties provide GA.
LAO Proposal: Eliminate the mandate and in three years shift responsibility for GA to the state. Would establish uniform benefits.
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TIME LIMITS
Current Law: No time limits for families on aid. Counties allowed to limit GA to three months of aid in a 12-month period.
Wilson Plan: Current welfare recipients who fail to find work in two years lose cash aid. Newcomers to welfare rolls who aren’t working after one year lose aid. Non-cash aid continues for children.
LAO Proposal: After five years, cash benefits for families are reduced by about a third if able-bodied adults are not working. GA recipients lose aid after two years if not working at least 20 hours a week.
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EMPLOYMENT
Current Law: Counties allowed to establish workfare programs for GA recipients. Counties given the option to make work slot available if the adult in a family on aid is not working after participating in GAIN--the work training program--for two years.
Wilson Plan: Adults in one-parent families required to work, undergo training or seek employment at least 32 hours a week. For two-parent families the requirement is at least 35 hours per week. Counties given option of providing community service jobs.
LAO Proposal: Community Service employment required for welfare parents not working at least 20 hours a week after two years. Community Service employment required for GA recipients within a few months of beginning aid.
Sources: Governor’s office; legislative analyst’s office
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