BILL ANALYSIS                                                                                                                                                                                                    Ó






                  SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW
                                Mark Leno, Chair
                                        
          Bill No:       AB 1471
          Author:        Committee on Budget
          As Amended:    June 26, 2012
          Consultant:    Jennifer Troia
          Fiscal:        Yes
          Hearing Date:  June 26, 2012
          
          Subject:  Budget Act of 2012:  Human Services Omnibus

          Summary:  Contains the necessary statutory and technical 
          changes to implement the Human Services provisions of the 
          Budget Act of 2012. 
          
          Proposed Law:  

          This bill includes the following provisions:

          1)CalWORKs:  Makes changes to the California Work 
            Opportunity and Responsibility to Kids (CalWORKs) program 
            that result in savings of approximately $469.1 million 
            General Fund, as follows: 

             a)   Changing Time Limits and Work Participation 
               Requirements:

               i.     Modifies the number of welfare-to-work 
                 participation hours to conform to current federal 
                 requirements and eliminates requirements related to 
                 participation in core and non-core activities.    

               ii.    Changes welfare-to-work requirements applicable 
                 to CalWORKs recipients, on or after January 1, 2013, 
                 by creating a new 24-month time limit.  Unless 
                 otherwise exempt from participation, applicants and 
                 recipients would receive 24 months of 
                 welfare-to-work services and activities under 
                 current state rules, and would then be required to 
                 meet federal participation requirements to access 
                 the remainder of the months toward their 48-month 
                 lifetime time limit.  Provides that this 24-month 
                 time limit is a prospective change, and that months 
                                       -1- 










                 of assistance prior to January 1, 2013 shall not be 
                 counted toward the 24-month time limit.  

               iii.   Further, specifies that months of assistance 
                 during which the recipient has been sanctioned or 
                 excused from participation for good cause, qualifies 
                 for an exemption, or is a custodial parent who is 
                 under 20 years of age and who has not earned a high 
                 school diploma or its equivalent, do not count 
                 toward the 24-month time limit.  Additionally, 
                 months during which the recipient is participating 
                 in job search or assessment, is in the process of 
                 appraisal, or is participating in the development of 
                 a welfare-to-work plan, as specified, do not count 
                 toward the 24-month time limit.  Finally, months in 
                 which the recipient is meeting federal participation 
                 requirements do not count as a month of activities 
                 for purposes of the 24-month time limit.  

               iv.    Provides for notice requirements to recipients 
                 regarding the 24-month time limit that explain the 
                 process by which recipients may claim exemptions 
                 from, and extensions to, the 24-month time limit 
                 when the individual applies for aid, during the 
                 recipient's annual redetermination, and at least 
                 once after the individual has participated for a 
                 total of 18 months, and prior to the end of the 21st 
                 month, that count toward the 24 month time limit.  

               v.     Requires the Department of Social Services 
                 (DSS), in consultation with stakeholders, to convene 
                 a workgroup to determine further details of the 
                 noticing and engagement requirements for the 24 
                 month time limit, and to instruct counties by way of 
                 an all-county letter, followed by regulations, no 
                 later than 18 months after the effective date of 
                 January 1, 2013.  

               vi.    Provides that counties may extend assistance 
                 for no more than 20 percent of recipients, as 
                 specified, upon expiration of the 24-month time 
                 limit.  Requires DSS to consult with stakeholders 
                 and to develop and issue instructions on the process 
                 for implementing these extensions and calculating 
                                       -2- 










                 this 20 percent limitation.  

               vii.   With respect to extensions of the 24-month time 
                 limit, allows recipients to submit evidence that the 
                 following circumstances exist: a) is likely to 
                 obtain employment within six months; b) has 
                 encountered unique labor market barriers preventing 
                 employment; c) has achieved satisfactory progress in 
                 an educational or training program; d) needs 
                 additional time to complete a welfare-to-work 
                 activity included in the case plan due to a 
                 diagnosed learning or other disability; or e) has 
                 submitted an application to receive SSI disability 
                 benefits and is awaiting an established hearing 
                 date.  Subject to the 20 percent limitation 
                 described above, requires counties to grant 
                 extensions of time under these circumstances, unless 
                 they determine that the evidence presented does not 
                 support the existence of the circumstances.  If the 
                 county makes such a determination and there is a 
                 hearing disputing the denial of an extension, 
                 establishes that the burden of proof is on the 
                 county to establish that the extension was not 
                 justified.

               viii.  Provides that a county may, again subject to 
                 the 20 percent limitation, grant an extension of the 
                 24-month time limit if, as a result of information 
                 already available to a county, the county identifies 
                 that a recipient meets the circumstances described 
                 above.  

               ix.    States that it is the Legislature's intent that 
                 the state shall work with the counties and other 
                 stakeholders to ensure that the extension process 
                 will be implemented with minimal disruption to the 
                 impending completion of welfare-to-work plans for 
                 recipients.  

               x.     Provides that for a recipient who is not exempt 
                 or granted an extension pursuant to the above, and 
                 who does not meet the federal participation 
                 requirements between their 24th and 48th month time 
                 limits, the same policies regarding the removal of 
                                       -3- 










                 the adult portion of the grant and opportunities for 
                 engagement and curing are available as those 
                 applicable to sanctions pursuant to current law.  
                 For purposes of this new policy, however, states 
                 that the procedures referenced shall not be 
                 described as sanctions.  
            
             a)   Changes Related to Exemptions from Work 
               Participation Requirements: 
               
               i.     Extends the current temporary exemptions 
                 provided in relation to the reduction in the county 
                 single allocation from July 1, 2012 until January 1, 
                 2013, when these exemptions will sunset.  These 
                 temporary exemptions are provided to a parent or 
                 other relative who has primary responsibility for 
                 personally providing care to one child who is from 
                 12 to 23 months of age, inclusive, or 2 or more 
                 children who are under 6 years of age.  These 
                 exemptions are commonly referenced as "temporary 
                 young child" exemptions.  

               ii.    States that reduced funding, including a 
                 reduction to the county single allocation, for the 
                 period between July 1, 2012 and January 1, 2015, 
                 will result in insufficient resources to provide the 
                 full range of welfare-to-work services during that 
                 time period.  

               iii.   Extends through January 1, 2015, the option for 
                 a county to redirect funding appropriated for 
                 CalWORKs mental health employment assistance 
                 services and CalWORKs substance abuse treatment 
                 services, from and to other CalWORKs employment 
                 services that are necessary for individuals to 
                 participate in welfare-to-work activities.  

               iv.    Requires counties to reengage recipients who 
                 had received the temporary young child exemption in 
                 welfare-to-work activities starting January 1, 2013 
                 and over a period of two years (unless those 
                 recipients are otherwise exempt from participation). 
                  Recipients will not be required to participate 
                 until the county welfare department reengages them.  
                                       -4- 












               v.     Creates a similar, ongoing, one-time young 
                 child exemption for caregivers of a child 24 months 
                 of age or younger, and provides that a month during 
                 which this exemption applies would not be counted as 
                 a month of receipt of aid for the recipient.  

             c)  Other Changes:

               i.     Requires DSS to convene a workgroup to identify 
                 best practices and other strategies to improve early 
                 engagement and barrier removal efforts, as 
                 specified, and to report back to the Legislature by 
                 January 10, 2013 regarding its related actions and 
                 recommendations.

               ii.    Requires DSS to annually update the Legislature 
                 regarding the changes made by this bill to the 
                 CalWORKs program, and to contract with an 
                 independent, research-based institution for an 
                 evaluation and written report, with specified 
                 contents, which would be provided to the Legislature 
                 by October 1, 2017.  

               iii.   Exempts a CalWORKs assistance unit that does 
                 not include an eligible adult from periodic 
                 reporting requirements other than annual 
                 redetermination and makes corresponding changes.  

               iv.    Restores the earned income disregard policy to 
                 that which existed prior to the enactment of the 
                 2011-12 Budget Act, allowing a participant to retain 
                 $225 and $.50 of each dollar thereafter of monthly 
                 earnings (altering the 2011-12 policy that allows 
                 retention of $112 and $.50 of each dollar).  This 
                 policy will apply to the entire caseload with 
                 earnings and will take effect October 1, 2013.    

               v.     Delays the effective date for the Work 
                 Incentive Nutritional Supplement (WINS) program 
                 until January 1, 2014 and reduces the amount of the 
                 WINS benefit, which is an additional food assistance 
                 benefit for each eligible food stamp household, from 
                                       -5- 










                 $40 to $10 per month.  Correspondingly, delays dates 
                 associated with the development of policy toward a 
                 pre-assistance employment readiness system (PAERS) 
                 program and other options that may benefit the 
                 CalWORKs program, as specified.  

          2)Phase-in and Reporting Related to Cal-Learn Program:  
            Restores the operation of intensive case management 
            services provided through the Cal-Learn program within 
            CalWORKs.  State funding for these services was suspended 
            during the 2011-12 fiscal year.  From July 1, 2012 to 
            March 31, 2013, inclusive, authorizes counties to provide 
            full or partial year funding, depending on the pace of 
            their progression to full implementation, by April 1, 
            2013.  Additionally requires the Department of Social 
            Services (DSS) to annually report specified information 
            related to the program to the budget committees of the 
            Legislature.  The phase-in approach included in this bill 
            provides for savings in 2012-13 of approximately $10 
            million GF.  

          3)Child Support Payment Trust Fund:  For the 2012-13 fiscal 
            year only, authorizes money in the Child Support Payment 
            Trust Fund accounts to be invested in specified 
            securities or alternatives that offer comparable 
            security, including mutual funds and money market funds.  
            The provision does not authorize an investment or 
            transfer that would interfere with the objective of the 
            Child Support Payment Trust Fund.  

          4)Continues Suspension of Child Support Incentive Payments: 
             Extends the suspension of performance and health 
            insurance-related incentive payments to local child 
            support agencies (LCSAs) through the 2014-15 fiscal year. 
             Existing law, in the absence of a suspension, would 
            award the ten highest performing counties with an 
            additional share of collections and require the state to 
            provide payments to LCSAs of $50 per case for obtaining 
            3rd-party health coverage or insurance of Medi-Cal 
            beneficiaries.  

          5)Continues Suspension of Fingerprint Fee Exemption:  
            Extends the suspension of a prohibition on the state 
            charging fees for fingerprinting in order to conduct 
                                       -6- 










            background checks of  applicants for licenses to operate 
            specified community care facilities that serve children.

          6)Changes to Implementation Date for Sales Tax on Support 
            Services:  Delays the date when the state can implement 
            existing law related to the extension of the sales tax to 
            apply to support services (i.e., homecare)- from July 1, 
            2010 to January 1, 2012.  Under existing law, 
            corresponding supplementary payments would be made to 
            specified providers of those services.  

          7)Repeals Sections Related to Statewide Eligibility and 
            Enrollment Processing:  Repeals a statute that was 
            enacted as part of the 2009 Budget Act that required the 
            Administration to develop a statewide eligibility and 
            enrollment determination process for the California Work 
            Opportunity and Responsibility to Kids (CalWORKs), 
            Medi-Cal, and Supplemental Nutrition Assistance Program 
            (SNAP, also known as CalFresh or food stamps) programs, 
            and directed the development of a comprehensive plan with 
            respect to a centralized eligibility and enrollment 
            process.  Subsequent statutes changes related to the 
            Statewide Automated Welfare System have obviated these 
            requirements.  Thus, this repeal resolves potential 
            statutory conflicts with respect to the state's 
            information technology systems and enrollment processes.  


          8)Moratorium on Group Home Rate-Setting:  Permanently 
            extends the moratorium on the licensing of new group 
            homes or approvals of specified changes for existing 
            providers, with some allowable exceptions.  This 
            moratorium was initially established as a part of the 
            2010 Budget Act.  New provisions further limit, for one 
            year, exceptions for any programs with rate 
            classification levels below 10 to those associated with a 
            program change.  

          9)Cost-of-Living Adjustment for Dual Agency Rates:  
            Requires annual adjustment by changes in the cost of 
            living (as measured by the California Necessities Index) 
            of rates payable for care and supervision of children who 
            are dually eligible for the Child Welfare Services and 
            Developmental Services systems.  This change is 
                                       -7- 










            consistent with changes made last year to foster family 
            home and related rates in response to litigation.  Under 
            the provisions of this bill, the change to dual agency 
            rates would begin retroactively with the 2011-12 fiscal 
            year.  

          10)Repeal of Medication Dispensing Machine Pilot: Repeals 
            statute that required the Department of Health Care 
            Services (DHCS) to establish a medication dispensing 
            machine pilot project for certain at-risk Medi-Cal 
            recipients.  This pilot project was also associated with 
            a reduction, with some exceptions, in authorized hours of 
            service for In-Home Supportive Services (IHSS) recipients 
            that would have been triggered if savings from the pilot 
            had not been achieved.  This bill would repeal both of 
            these policies. 

          11)Extension of 3.6 Percent Reduction in Authorized IHSS 
            Hours:  Extends, for the 2012-13 fiscal year, an existing 
            reduction of 3.6 percent in authorized IHSS hours that is 
            otherwise scheduled to sunset on July 1, 2013.  This 
            reduction is anticipated to save approximately $58.9 
            million GF in 2012-13.

          12)Criminal Offender Record Information (CORI) Sharing:  
            Authorizes local public authorities or nonprofit 
            consortia to share Criminal Offender Record Information 
            (CORI) background reports with DSS in specified 
            circumstances.  More specifically, allows the public 
            authority or nonprofit consortia to share this 
            information when an individual who is applying to become 
            an IHSS provider has requested from the department an 
            exception to a prohibition on his/her ability to become a 
            provider because of his/her criminal record.

          13)Rate-setting for IHSS Public Authorities:  Extends by 
            one year, to the 2013-14 fiscal year, the required time 
            by which DSS, in consultation with designated 
            stakeholders, must develop a new rate-setting methodology 
            for estimating the costs of public authorities with 
            respect to administration of specified requirements 
            related to the state's IHSS program.

          14)Rehabilitation Appeals:  Eliminates the Rehabilitation 
                                       -8- 










            Appeals Board, which currently serves as the entity which 
            hears appeals by applicants for, or clients of, programs 
            provided by the Department of Rehabilitation.  Instead 
            provides for fair hearings to be held before an impartial 
            hearing officer and establishes standards, training, and 
            due process requirements related to those fair hearings.

          15)Kids' Plates Funding:  Amends existing requirements 
            related to distribution of funds in the Child Health and 
            Safety Fund that are derived from the Have a Heart, Help 
            Our Kids specialized license plate program (Kids' 
            Plates).  Specifically, redirects $501,000 from child 
            abuse and injury prevention programs to support specific 
            Department of Social Services' (DSS) responsibilities 
            related to child day care licensing.  

          16)Child Welfare Services Automation System:  Requires DSS 
            to use specified funding included in the 2012 Budget Act 
            for the next steps necessary to move forward with the 
            recommendation of the Child Welfare Automation Study Team 
            (CWAST) to proceed toward procuring a new information 
            technology system to replace the existing Child Welfare 
            Services/Case Management System (CWS/CMS).  Further, 
            requires the Office of Systems Integration (OSI) and the 
            department to report the results of these activities, in 
            addition to key milestones and anticipated timelines, to 
            the Legislature by March 1, 2013, for review during 2013 
            budget hearings.

          17)Assessment of Automation Costs:  Requires DSS and the 
            Office of Systems Integration (OSI) to have a qualified 
            3rd party conduct a cost-reasonableness assessment of 
            specified costs related to changes in the Statewide 
            Automated Welfare System (SAWS).  More specifically, 
            requires this assessment with respect to costs that will 
            be proposed by the project vendor in order to consolidate 
            two of the state's three existing consortia systems into 
            one new consortium (leaving the state with a 
            two-consortium system).  This migration will consolidate 
            data and functionality for the counties currently served 
            by Consortium-IV into the Los Angeles Eligibility, 
            Automated Determination, Evaluation and Reporting 
            (LEADER) Replacement System, which is newly being 
            developed.  The cost reasonableness assessment is 
                                       -9- 










            intended to assist the state in determining whether the 
            proposed overall costs for this migration are within 
            range of reasonableness, based on specified factors.

          Support:  Unknown

          Opposed:  Unknown




































                                       -10-