BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de Le�n, Chair


          AB 1094 (Brown) - CalWORKs eligibility: veteran's disability  
          compensation.
          
          Amended: May 24, 2013           Policy Vote: Human Services 6-0
          Urgency: No                     Mandate: Yes
          Hearing Date: August 30, 2013                           
          Consultant: Jolie Onodera       
          
          SUSPENSE FILE.
          
          
          Bill Summary: AB 1094 would expand the definition of  
          disability-based unearned income to include veteran's disability  
          compensation for purposes of the income disregard under the  
          CalWORKs program. 

          Fiscal Impact: Unknown, potential increase in annual CalWORKs  
          grant costs in the range of $500,000 to $1.2 million (General  
          Fund). It is unknown how many existing CalWORKs families include  
          a veteran receiving disability compensation though it is known  
          that 0.2 percent of CalWORKs households report unearned income.  
          Based on the average disability compensation benefit of $1,270  
          and the maximum income disregard of $225, this estimate reflects  
          the assumption that 10 to 25 percent of CalWORKs cases reporting  
          unearned income represent veterans receiving disability  
          compensation.

          Background: Current law provides for the California Work  
          Opportunity and Responsibility to Kids (CalWORKs) program under  
          which each county provides cash assistance and other benefits to  
          qualified low-income families. Under existing law, for the  
          purpose of the CalWORKs income test and grant computation,  
          "disability-based unearned income" is defined as state  
          disability insurance benefits, private disability insurance  
          benefits, temporary workers' compensation benefits, and social  
          security disability benefits.

          Under existing law, the specified types of unearned income noted  
          above provided to disabled persons are calculated separately  
          from other unearned income. Income in this category receives a  
          special disregard of $225 for the recipient income test and the  
          grant computation. This has the effect of increasing a CalWORKs  








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          recipient's grant. The current disability-based unearned income  
          disregard allows families receiving CalWORKs benefits to  
          maintain some or all of their disability payment, as well as a  
          small amount of their earned income, in addition to their  
          CalWORKs grant. However, not all types of "disability-based"  
          unearned income are included in this category. 

          Current statute does not include veteran's disability  
          compensation within the CalWORKs definition of disability-based  
          unearned income for purposes of calculating grants.
          This bill seeks to provide a disabled veteran with a family the  
          ability to maintain the same amount of monthly income as a  
          CalWORKs recipient who receives disability benefits unrelated to  
          military service.

          Proposed Law: This bill expands the definition of  
          disability-based unearned income to include any veteran's  
          disability compensation. This bill requires the Department of  
          Social Services (DSS) to implement the changes made by the  
          provisions of this bill by means of an all-county letter or  
          similar instruction on or before July 1, 2014, without taking  
          regulatory action.

          Staff Comments: By expanding the definition of disability-based  
          unearned income to include veteran's disability compensation for  
          purposes of the income disregard under the CalWORKs program,  
          this bill will result in increased CalWORKs grant costs. It is  
          unknown how many current CalWORKs families include a veteran  
          receiving disability compensation benefits.

          The Department of Veterans Affairs has indicated that based on  
          Fiscal Year 2012 data, 276,720 veterans in California were  
          receiving disability compensation on some level. Based on total  
          disability compensation expenditures in California as reported  
          by the Veterans Administration, it is estimated that each  
          veteran received compensation of roughly $1,270 per month. The  
          average length of time of receipt of benefits is unknown and  
          would vary on a case by case basis.

          Data from the DSS indicates 0.2 percent of CalWORKs households  
          (1,800 households) report unearned income, however, it is  
          unknown what portion of those households include a veteran  
          receiving disability compensation benefits. For every 10 to 25  
          percent of households that include a veteran receiving  








          AB 1094 (Brown)
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          disability compensation benefits, assuming the full $225 income  
          disregard would result in increased CalWORKs grant costs in the  
          range of $500,000 to $1.2 million (General Fund).