BILL ANALYSIS Ó
SENATE COMMITTEE ON HUMAN SERVICES
Senator McGuire, Chair
2015 - 2016 Regular
Bill No: AB 492
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|Author: |Gonzalez |
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|Version: |January 25, 2016 |Hearing |May 10, 2016 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant|Taryn Smith |
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Subject: CalWORKs: welfare-to-work: supportive services
SUMMARY
This bill provides that necessary supportive services for
California Work Opportunity and Responsibility to Kids
(CalWORKs) recipients who are participating in Welfare-To-Work
(WTW) activities will include a diaper-needs benefit in the
amount of $50 per month for diapers for every child 2 years of
age or younger, as specified. The bill requires that the
diaper-needs benefit be issued to participants through the
electronic benefits transfer (EBT) system, and directs the
California Department of Social Services (CDSS) to make the
benefit available at the earliest time possible. The bill
specifies that the diaper-needs benefit is not income for
purposes of determining CalWORKs eligibility or benefits.
ABSTRACT
Existing law:
1) Establishes in Federal law the Temporary Assistance to
Needy Families (TANF) program to provide assistance to
needy families so that children may be cared for in their
own homes or in the homes of relatives, and to end the
dependence on government benefits by promoting job
preparation, work and marriage. (45 CFR 260.2)
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2) Establishes in CalWORKs, administered by CDSS to provide
cash benefits, employment training and other supports to
low-income families through a combination of state and
county funds and federal funds through the TANF block
grant. (WIC 11200, et seq.)
3) Establishes income, asset and real property limits used
to determine eligibility for the program, including net
income below the Maximum Aid Payment (MAP), based on family
size and county of residence. (WIC 11450, 11150 et seq.)
4) Establishes a 48-month lifetime limit of CalWORKs
benefits for eligible adults, including 24 months during
which a recipient must meet federal work requirements in
order to retain eligibility. (WIC 11454, 11322.85)
5) Requires necessary supportive services be made available
to every participant in the WTW program within CalWORKs in
order to participate in the program activity to which he or
she is assigned or to accept employment or requires that
the participant be given a good cause waiver. Also requires
that those supportive services include child care,
transportation costs, ancillary expenses, as defined,
personal counseling and case management, if the county
provides it. (WIC 11323.2)
6) Establishes in the EBT Act a system for the distribution
and use of public assistance benefits and requires EBT
access to be provided through automated teller machines
(ATMs), point-of-sale devices and other devices that accept
EBT transactions. (WIC 10072, et seq.)
7) Establishes the rights and liabilities of consumers as
well as the responsibilities of all participants in
electronic funds transfer activities under the federal
Electronic Fund Transfer Act. (15 USC 1693, et seq.)
8) Sets standards of operation for licensed child care
providers. (CCR, Title 22, 101151, et seq.)
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9) Requires that infants in licensed care centers shall be
kept clean and dry at all times; the infant care center
shall ensure that the infant has sufficient changes of
clothing and diapers so that his/her clothing and diapers
can be clean and dry at all times; and each infant's
clothing and diapers shall be changed as often as necessary
to ensure that the infant is clean and dry at all times.
(CCR Title 22, 101428 (b))
This bill:
1) Adds a diaper-needs benefit in the amount of $50 per
month for diapers for every child two years of age or
younger enrolled in child care as a supportive service for
a parent participating WTW.
2) Requires that the diaper-needs benefit shall be issued
to participants through the EBT system, as specified.
3) Requires that the diaper-needs benefit shall not be
considered income for purposes of determining CalWORKs
eligibility or benefits.
4) Requires that CDSS make the diaper-needs benefit
available as soon as possible and states that the benefit
may be implemented through a contract or subcontract,
including extensions of that contract or subcontract, that
results from a request for proposal or bid that occurred
prior to the effective date of this bill, but not if
implementation would violate the specific terms of the
contract or the Agreement on Government Procurement of the
World Trade Organization.
FISCAL IMPACT
An analysis prepared by the Assembly Appropriations Committee
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indicates that the $50 monthly benefit would cost approximately
$7.8 million in 2016-17 and $15.6 million annually.
Additionally, the analysis notes a potential one-time cost of
General Fund dollars of an unknown amount to update existing
automation systems.
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BACKGROUND AND DISCUSSION
Purpose of the bill:
According to the author, despite being critical to the health
and hygiene of young children, diapers are excluded from state
and federal assistance program such as CalFresh, the Women
Infant and children program (WIC) and Medi-Cal. Aside from free
diapers provided by community organizations, there is no relief
for low-income families from the high cost of diapers, per the
author. The author states, 1 in 3 families in California lack a
sufficient supply of diapers to keep their young children clean
and dry, a condition known as diaper-need.
The author states that diaper-need directly creates a barrier
between parents and gainful employment because most child care
providers require that the parent provide diapers for each child
as a condition of attendance. Among the many reports
identifying the lack of affordable child care as a top barrier
faced by parents when attempting to enter or remain in the
workforce, a study available thought the National Institutes of
Health has also found that lack of child care to be the number
one barrier to work for single mothers.<1>
For low-income parents trying to stay employed or in school,
diaper-need can be an everyday crisis, per the author.
Additionally, when a WTW participant is unable to leave a baby
at childcare because of insufficient diaper supply, that
parent's work activity plan can be disrupted, possibly resulting
in negative consequences from the CalWORKs program, the
employer, or both. The author states that the CalWORKs program
is intended to help families become financially self-sufficient
and reduce reliance on public assistance, but daily potential
pitfalls such as lack of diaper supply threaten successful
outcomes.
CalWORKs
The CalWORKs program provides monthly income assistance and
employment-related services aimed at moving children out of
poverty and helping families meet basic needs. Federal funding
for CalWORKs comes from the TANF block grant.
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<1> http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2792579/
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The average monthly cash grant for a family of three on CalWORKs
(typically one parent and two children) is $497. These funds
are provided to help families meet basic needs, such as rent,
clothing, utility bills, food, and other items. Per the
2016-2017 Governor's budget, the average monthly grant for a
CalWORKs household is $497.35 and the maximum aid payment for a
family of three is $704, or 42 percent of Federal Poverty Level.
According to recent data from CDSS, around 497,000 families will
rely on CalWORKs in Fiscal Year 2016-17. More than one million
are children. Nearly 60 percent of cases include children 6
years old or younger, and about 12 percent of cases include
children younger than one year old.
Child Care
Child care is among the supportive services available to
participants in the CalWORKs WTW program. Regulatory standards
for licensed child care centers are set forth in Title 22 of the
California Code of Regulations, which includes a mandate that
child care center shall ensure each infant has sufficient
changes of clothing and diapers, and that each infant's clothing
and diapers are to be changed as often as necessary to ensure
that each infant is kept clean and dry at all times. According
to The Diaper Bank, most licensed child care providers require
the parent to provide sufficient diapers to keep a child clean
and dry as a condition of attendance.<2>
Cost of Diapers
According to the National Diaper Bank Network, infants require
up to 12 diapers per day and toddlers require about 8 diapers
per day. The Network also reports that disposable diapers cost
$70 to $80 per month per baby and one in three families
struggles to purchase diapers. Currently, no state or federal
child safety-net program allocates dollars specifically for the
purchase of diapers, per the Network.<3>
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<2> http://thediaperbank.org/index.php/facts_and_impacts/
<3> http://nationaldiaperbanknetwork.org/what-is-diaper-need/
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The Diaper Bank, a different organization, reports that most
licensed day care centers do not accept cloth diapers.
Additionally, for sanitary reasons, coin-operated laundromats
often don't allow customers to wash cloth diapers. According to
the Diaper Bank, most licensed child care centers require
parents and caregivers to provide a steady supply of disposable
diapers. The Diaper Bank also reports that low-income parents
cannot take advantage of free or subsidized childcare if they
cannot afford to leave disposable diapers at childcare centers.
Without access to daycare, parents are less able to attend work
or school on a consistent basis.<4>
A 2013 study published in the journal, Pediatrics, concluded
that unmet diaper need was an issue of medical concern.
According to the study, emerging research suggests indicators of
material hardship are increasingly important to child health.
The study supports this premise with the suggestion that an
adequate supply of diapers may prove a tangible way of reducing
parenting stress, a critical factor influencing child health and
development.<5>
DSS estimates this bill would impact approximately 26,000
CalWORKs children per month.
Federal Actions on Electronic Transfers and EBT Cards
The federal Electronic Fund Transfer Act was established in 1978
to protect individual consumers engaging in fund transfers. It
establishes the rights, liabilities, and responsibilities of
financial institutions that offer such services and of the
customers who use them. In 2010, the federal Department of the
Treasury mandated that federal benefit payments such as social
security, veterans' benefits and others be delivered through an
electronic transfer.
Additionally, the United States Department of Agriculture is
requiring that benefits for the WIC program, which is a
nutrition assistance program for low-income pregnant,
breastfeeding and post-partum women and children under age five
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<4> http://thediaperbank.org/index.php/facts_and_impacts/
<5> Smith, Megan, et al. "Diaper Need and Its Impact on Child
Health," Pediatrics, July 29, 2013.
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who are at nutritional risk, must be issued via EBT cards by
October 1, 2020. California's Department of Public Health (DPH)
has begun the process of developing the information technology
systems and the policies necessary to meet this federal mandate.
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California's Use of EBT cards to Distribute Assistance
CalFresh recipients are distributed funds for food benefits
through an EBT system, which allows recipients to access funds
at point-of-sale terminals, ATMs and other electronic fund
transfer devices. EBT cards look similar to ATM debit cards,
and are swiped through the same machines using magnetic strips
to transfer information. While California's EBT system was
designed to deliver CalFresh benefits, all of California's 58
counties also deliver either CalWORKs and/or General Assistance
benefits through the EBT cards. Additionally, as noted above,
DPH is in the process of implementing EBT cards for the federal
WIC program.
According to CDSS, in 2013 (the most recent time for which data
was available) there were 35.5 million EBT transactions. Of
that, 17 million transactions were used for direct purchases,
2.5 million were for cash back only from a purchase of service
location and nearly 5.5 million transactions were purchases with
cashback. According to the DSS Internet Web site, EBT food and
cash aid benefits can be redeemed at more than 80,000 locations
in California.
Agreement on Government Procurement of the World Trade
Organization
The Agreement on Government Procurement of the Word Trade
Organization (WTO) was enacted in its current form on January 1,
1996. The United States is one of about 45 WTO members that are
a party to the agreement. According to the WTO, the fundamental
aim of the agreement is to mutually open government procurement
markets among its parties and an estimated $1.7 trillion
annually have been opened to international competition.
Related legislation:
AB 1516 (Gonzalez, 2014) would have provided CalWORKs
recipients an $80 per month young child special needs
assessment, for the purpose of purchasing diapers, for every
child age 2 years of age or younger in the assistance unit.
This bill did was held in Senate Appropriations Committee.
AB 1614 (Stone, Chapter 720, 2014) requires users of EBT cards
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to be provided access to transaction history via toll-free
telephone hotline and Internet Web sites, among other methods.
This bill requires users of EBT cards to be informed of where
they can use their cards to withdraw funds without fees, and
other information regarding fees. This bill also specifies that
CDSS is prohibited from being held liable for authorizing a
direct deposit of child support payments into an account that is
not a qualifying account.
Arguments in Support:
According to the Coalition of California Welfare Rights
Organizations, Inc. "For low-income parents trying to stay
employed or in school, diaper need is a potential crisis on any
given day. Not being able to leave a young child in daycare
because of insufficient diaper supply can disrupt a parent's
job, possibly resulting in workplace discipline. A study
available from the National Institutes of Health has documented
access to childcare as the number one barrier to employment for
single mothers. Yet, the food assistance and health care
programs that are crucial to helping California's struggling
families provide no relief for diaper need?.Knowing that diaper
need is a barrier to childcare, it is easy to see how the high
price of diapers could have a big cost to the success of
CalWORKs. AB 492 will help to keep children and parents
healthy, and keep parents on track with their work plans by
increasing access to childcare."
Arguments in Opposition:
CDSS writes, "In each of the Fiscal Years' 2013-14 and 2014-15
budget, CalWORKs maximum grant amounts were raised by five
percent, for a cumulative increase of 10 percent. Further,
given the ongoing General Fund costs of approximately $15.4
million per year that would result from this bill, it is
appropriate that this measure be considered along with recent
budget augmentation and other CalWORKs proposals recently
approved or currently pending in the Legislature. Providing what
equates to an additional increase to CalWORKs grants for
families with young children should instead be carefully
considered as part of a comprehensive analysis of potential
unmet needs facing CalWORKs families, and the most effective
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means to address families in deep poverty."
COMMENTS
According to the author's office, the $50 diaper-needs benefit
proposed in AB 492 is an addition to the supportive services -
and not an augmentation of the maximum cash grant - available
for WTW participants for the sole purpose of purchasing of
diapers. According to the author, it is not intended for
purchasing products associated with diaper use, like powder or
wipes. The author's office says EBT cards can be programmed to
limit the types of products that can be purchased with the cards
by using Universal Product Codes (UPC). This type of programming
would help to ensure the added $50 benefit is spent on diapers.
The author's office may wish to consider amending the bill to
clarify that the monthly diaper-needs benefit is not an increase
in the maximum cash grant and would be solely for the purchase
of diapers.
This bill adds Section 11323.22 to the Welfare and Institutions
Code, which would allow that the diaper-needs benefit may be
implemented via a contract awarded based on a request for
proposal or bids that occurred prior to the effective date of
this bill. According to the author's office, this section was
added to expedite implementation of this bill and allow for
synchronization with existing information technology projects,
such as DPH efforts to issue WIC benefits via EBT cards by
October 1, 2020.
According to the author's office, Section 11323.22 is intended
to provide flexibility to the administration in order to
expedite implementation of the diaper-need benefit. It is not
clear that legislative language providing authority to amend
existing contracts is necessary, as contract amendments area
already permissive within the Public Contract Code, as
specified. The author may wish to explore amending the bill to
clarify the intent of Section 11323.22 and determine if it
necessary.
The state's current contract for EBT services is about to expire
and California's Office of Systems Integration announced that
the new contract would be awarded to Fidelity Information
Services on December 4, 2015. However, this new contract has
been challenged in court by Xerox, which holds the current EBT
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contract and was one of the bidders on the new contract. The
pending litigation (Xerox State & Local Solutions Inc., New York
Corporation vs. California Office of Systems Integration) is
scheduled for a hearing in Sacramento Superior Court on May 13,
2016. It is not clear if this litigation might affect
implementation of AB 492.
AB 492 also requires that a contract entered in order to
implement the bill may not violate the WTO Agreement on
Government Procurement, which is intended to facilitate mutually
open government procurement markets among its international
parties.
PRIOR VOTES
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|Assembly Floor: |64 - |
| |9 |
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|Assembly Appropriations Committee: |12 - |
| |5 |
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|Assembly Human Services Committee: |5 - |
| |1 |
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POSITIONS
Support:
Coalition of California Welfare Rights Organizations
(Sponsor)
Access Women's Health Justice
ACT for Women and Girls
Alameda County Board of Supervisors
American Academy of Pediatrics
Baby2Baby
Black Women for Wellness
California Alternative Payment Program Association
California Association of Food Banks
California Catholic Conference, Inc.
California Catholic Conference of Bishops
California Immigrant Policy Center
California Latinas for Reproductive Justice
California Primary Care Association
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Center on Reproductive Rights and Justice at the University
of California, Berkeley, School of Law
Common Sense Kids Action
Courage Campaign
Forward Together
Jewish Family Service of Los Angeles
Jewish Family Service of San Diego
Law Students for Reproductive Justice
National Diaper Bank Network
NARAL Pro-Choice California
Parent Voices California
Physicians for Reproductive Health
Planned Parenthood Action Fund of the Pacific Southwest
Planned Parenthood of Santa Barbara, Ventura, & San Luis
Obispo Counties
Planned Parenthood Affiliates of California
Planned Parenthood Mar Monte
San Diego Hunger Coalition
Santa Clara County Board of Supervisors
Starting Over, Inc.
Western Center on Law and Poverty
Women's Foundation of California
Women Organizing Resources, Knowledge and Services
Oppose:
California Department of Social Services
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