BILL ANALYSIS Ó AB 2062 Page 1 Date of Hearing: April 12, 2016 ASSEMBLY COMMITTEE ON HUMAN SERVICES Susan Bonilla, Chair AB 2062 (Lopez) - As Amended April 4, 2016 SUBJECT: CalWORKs: income reporting: benefit redetermination SUMMARY: Prohibits the assessment of a California Work Opportunity and Responsibility to Kids (CalWORKs) overpayment in the month immediately following a reported change if 10-days' notice of change in benefits has not been provided prior to the beginning of that month. Specifically, this bill: 1)Prohibits, for a CalWORKs recipient who is found to be no longer eligible for CalWORKs or to be eligible for a lower grant amount due to a reported change in income or, where applicable, household composition, the assessment of an overpayment in the month following that reported change if the county was unable to provide 10-days' notice of termination or reduction in benefits before the first of the following month. 2)Provides that no appropriation, as specified, shall be made for purposes of implementing this bill. AB 2062 Page 2 EXISTING LAW: 1) Establishes under federal law the Temporary Assistance for Needy Families (TANF) program to provide aid and welfare-to-work services to eligible families and, in California, provides that TANF funds for welfare-to-work services are administered through the CalWORKs program. (42 U.S.C. 601 et seq., WIC 11200 et seq.) 2)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, which is around 40% of the Federal Poverty Level. (WIC 11150 to 11160, 11450 et seq.) 3)Provides the formula for determining CalWORKs income thresholds and establishes income-reporting requirements for recipients. (WIC 11265.3 and 11265.47) FISCAL EFFECT: Unknown. COMMENTS: 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. The average 2016-17 monthly cash grant for a family of three on CalWORKs (one parent and two children) is $497.35, and the maximum monthly grant amount for a family of three, if the family has no other income and lives in a high-cost county, is AB 2062 Page 3 $704. According to recent data from the California Department of Social Services, around 497,000 families rely on CalWORKs, including over one million children. Nearly 60% of cases include children under 6 years old. Maximum grant amounts in high-cost counties of $704 per month for a family of three, with no other income, means $23.46 per day, per family, or $7.82 per family member, per day to meet basic needs, including rent, clothing, utility bills, food, and anything else a family needs to ensure children can be cared for at home and safely remain with their families. This grant amount puts the annual household income at $8,448 per year, or 42% of poverty. Federal Poverty Guidelines for 2016 show that 100% of poverty for a family of three is $20,160 per year. CalWORKs Income Reporting Threshold: Typically, any changes in a CalWORKs recipient's income are only reported during a semi-annual or annual (for Child Only cases) report. However, if a recipient's income surpasses the Income Reporting Threshold (IRT), then a mid-period report is mandatory. When a recipient's income exceeds the IRT, he or she must report this change to the county within 10 days. If the IRT is exceeded towards the end of the month, an overpayment in the following month can result, which the recipient will need to repay. Need for this bill: According to the author, "CalWORKs is designed to ensure that families can find employment and are capable of supporting their family. With much difficulty, working parents have many expenses pertinent to work that need attention, such as, child care and transportation. Receiving a letter from the county informing the family that an overpayment was acquired due to their change in income should be one less stress they need to endure. In cases like this, the county was unable to provide the sufficient 10-day notice of this modification in benefits. This bill would streamline the process and align the procedures welfare case workers currently follow for CalFresh recipients when it comes to overpayment and make it applicable to the CalWORKs program." AB 2062 Page 4 Suggested amendments: Because a change in household composition can trigger changes in eligibility or grant amounts for Child Only cases, committee staff recommends the following amendment to line 24 of page 6: 24 (C)If a recipient has reported a change in income or household composition in accordance 25 with subdivision (c), an overpayment shall not be assessed for the 26 following month if the county was unable to provide 10-days 27 notice of the termination or reduction in benefits before the first 28 of the month following the month in which the change occurred. REGISTERED SUPPORT / OPPOSITION: AB 2062 Page 5 Support Area Community Services (BACS) California Food Policy Advocates Coalition of California Welfare Rights Organizations, Inc. - sponsor Courage Campaign Law Foundation of Silicon Valley Placer People of Faith Together San Francisco City, Supervisor Katy Tang Western Center on Law and Poverty AB 2062 Page 6 Opposition None on file. Analysis Prepared by:Daphne Hunt / HUM. S. / (916) 319-2089