BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON HUMAN SERVICES
                               Senator McGuire, Chair
                                2015 - 2016  Regular 

          Bill No:              SB 659
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          |Author:   |Bates                                                 |
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          |----------+-----------------------+-----------+-----------------|
          |Version:  |January 4, 2016        |Hearing    |January 14, 2016 |
          |          |                       |Date:      |                 |
          |----------+-----------------------+-----------+-----------------|
          |Urgency:  |No                     |Fiscal:    |Yes              |
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          |Consultant|Taryn Smith                                           |
          |:         |                                                      |
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                      Subject:  Opportunity Grant Pilot Project


            SUMMARY
          
          This bill would require the California Department of Social  
          Services (CDSS), in consultation with the County Welfare  
          Directors Association of California, to design and implement a  
          5-year pilot project to provide grants to private organizations  
          that assist individuals receiving CalWORKs benefits in achieving  
          economic independence and to evaluate the effectiveness of the  
          programs funded by the grants.

            ABSTRACT
          
          Existing law:

             1)   Establishes the federal Temporary Assistance for Needy  
               Families (TANF) program, which permits states to implement  
               the program under a state plan. (42 USC § 601 et seq.)

             2)   Establishes in state law the CalWORKs program to provide  
               cash assistance and other social services for low-income  
               families through the TANF program. Under CalWORKs, each  
               county provides assistance through a combination of state,  
               county and federal TANF funds. (WIC 11200 et seq.)

             3)   Establishes under the CalWORKs program, a  
               welfare-to-work program and requirement that adults  
               participate in work or employment-related activities for  








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               specified amounts of time. (WIC 11320 et seq.)

             4)   Requires counties to submit a plan annually detailing  
               how it intends to deliver the full range of activities and  
               services necessary to move CalWORKs recipients from welfare  
               to work, including how it will collaborate with public and  
               private agencies for training and support services, what  
               partnerships it will form with the private sector, the  
               range of welfare-to-work activities it will offer  
               recipients, how it will provide substance abuse and mental  
               health treatment services, how it will provide child care  
               and transportation services, performance outcomes to track  
               whether the county's program meets locally established  
               objectives, and other items. (WIC 10531)

             5)   Requires CDSS to implement a CalWORKs county peer review  
               process no later than July 1, 2014 to assist with  
               implementing best practices and review each county's data,  
               as specified. (WIC 10533)

             6)   Identifies allowable welfare-to-work activities  
               including unsubsidized employment, on-the-job-training,  
               work study, education, including education to complete high  
               school proficiency or general educational certificate,  
               other educational pursuits, mental health, substance abuse  
               and domestic violence services and other activities  
               necessary to assist an individual in obtaining and  
               retaining employment. (WIC 11322.6)

             7)   Limits an adult's participation in welfare-to-work  
               activities and the associated cash benefits to 24  
               cumulative months during a recipients lifetime unless a  
               recipient meets federally defined work participation  
               requirements, and to 48 months of lifetime aid if an adult  
               is meeting federal work requirements. (WIC 11322.85)

             8)   Creates a family stabilization program within the  
               welfare-to-work program and defines eligibility as an  
               identified situation or crisis that is destabilizing the  
               family and would interfere with participation in  
               welfare-to-work activities and services, as defined, and  
               determined by the county. (WIC 11325.24 (b))

             9)   Requires each county to implement a family stabilization  









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               program, mandates that services include intensive case  
               management and services designed to support the family in  
               overcoming the crisis, clarifies that funds for the family  
               stabilization program be in addition to any funds allocated  
               to the client through the welfare-to-work program and  
               permits funds in the family stabilization program to be  
               used to provide housing and other needed services. (WIC  
               11325.24 (c) through(f))

             10)  Establishes the CalWORKs housing support program and  
               identifies a recipient as eligible for housing supports if  
               the county determines that his or her family is  
               experiencing homelessness or housing instability that would  
               be a barrier to self-sufficiency or child well-being. (WIC  
               11330.5)
          
          This bill:

             1)   Makes a series of Legislative findings and declarations  
               including: 

                  a.        California is expected to spend $142 billion  
                    on health and human services programs this year, which  
                    is by far the largest state budget expenditure, while  
                    total education spending for kindergarten, grades 1 to  
                    12, inclusive, and higher education programs is only  
                    $80 billion per year.
                  b.        California has the fifth largest Temporary  
                    Assistance for Needy Families (TANF) cash grant in the  
                    nation, and the second largest amongst the 10 largest  
                    states, yet poverty remains a persistent problem.

             2)   Requires CDSS, in consultation with the County Welfare  
               Directors Association of California, to implement a  
               five-year pilot project under which monetary grants are  
               provided to organizations operating programs that assist  
               individuals receiving CalWORKs benefits to achieve economic  
               independence.

             3)   Requires CDSS in developing the pilot project to, at a  
               minimum, do all of the following:

                  a.        Develop a competitive review process for all  
                    grant proposals submitted and a methodology to  









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                    determine grant amounts.
                  b.        Develop eligibility requirements for  
                    organizations seeking a grant. The eligibility  
                    requirements shall, at a minimum, require each  
                    organization's program to include eleven specified  
                    eligibility requirements (See item No 7 below). The  
                    eligibility requirements for organizations seeking a  
                    grant do not affect an individual's eligibility for  
                    CalWORKs benefits, as determined by the county. 
                  c.        Develop an ongoing evaluation, utilizing  
                    objective criteria, of the effectiveness of an  
                    organization receiving grant funding in teaching its  
                    program participants the skills necessary to achieve  
                    economic independence.

             4)   Appropriates $50 million from the state's General Fund  
               to CDSS to fund the pilot program. 

             5)   Establishes a number of criteria to be included in the  
               ongoing evaluation including the number and percentage of  
               partipcants that: 

                  a.        complete the program,
                  b.        achieve a high school diploma or equivalent  
                    while in the program,
                  c.        achieve family reunification, when applicable,  
                    and 
                  d.        are receiving CalWORKs benefits upon  
                    completion of the program.

             6)   Requires CDSS to develop a period progress report for  
               the duration of the pilot project.

             7)   Permits CDSS to enter into an agreement with an academic  
               institution or other entity with sufficient expertise for  
               the purpose of creating, performing, or both creating and  
               performing the evaluation, and requires CDSS and its  
               evaluator to seek input from stakeholders during the  
               development process.

             8)   Requires each program, in order to be eligible for the  
               grant, to include the following 11 minimum requirements: 

                  a.        Education focused on the attainment of a high  









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                    school diploma or its equivalent.
                  b.        Mental health services.
                  c.        Employment training.
                  d.        Financial training.
                  e.        Parenting skills training.
                  f.        Life skills training.
                  g.        Child care services. Each participating child  
                    care provider shall obtain a criminal record clearance  
                    pursuant to Section 1596.871 of the Health and Safety  
                    Code. If the organization serves only pregnant women,  
                    the organization shall not be required to provide  
                    child care services to be eligible for grant funding. 
                  h.        A clean and sober environment.
                  i.        Comprehensive, targeted case management to  
                    assist program participants.
                  j.        Ongoing monitoring of program participants for  
                    at least five years after they have completed the  
                    program for purposes of measuring long term program  
                    effectiveness.
                  aa.       Trauma-informed social work.

             9)   Permits an organization receiving a grant to utilize the  
               grant funds in any reasonable manner, as long as the funds  
               are expended in furtherance of the program elements or  
               other requirements the department establishes. Housing,  
               transportation, and child care expenses for program  
               participants shall be considered an allowable use of grant  
               funds.

             10)  Specifies that benefits an individual in a pilot program  
               receives may be in addition to any other public assistance  
               benefits for which the individual may be eligible.

             11)  Permits grant-funded organizations to set their own  
               eligibility criteria for their programs as long as the  
               eligibility criteria are consistent with the goals of the  
               pilot project. The criteria for eligibility set by the  
               organization do not affect an individual's eligibility for  
               CalWORKs benefits, as determined by the county.

             12)  Requires that organizations receiving grant funding  
               contact the county welfare department upon being notified  
               of the grant and make a good faith effort to coordinate  
               their programs with CalWORKs requirements.  









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             13)  Specifies that client participation in a program  
               administered by an organization receiving grant funding  
               under the pilot is voluntary.

             14)  Requires that CDSS or the contracted evaluator send a  
               report evaluating the effectiveness of the programs funded  
               by the grants to the relevant policy and fiscal committees  
               of the Legislature no later than December 31, 2021, as  
               specified, and post the report on the department's Internet  
               Web site. 

             15)  Prohibits the report from identifying individuals who  
               participate in the program, or from containing personally  
               identifiable information.

             16)  Sunsets the pilot project on July 1, 2022. 

            
            FISCAL IMPACT
          
          This bill has not been analyzed by a fiscal committee; however  
          it contains a $50 million General Fund appropriation over five  
          years for the purposes of funding the pilot program described. 

            BACKGROUND AND DISCUSSION
          
          Purpose of the bill:

          The author states that California has the highest rate of  
          poverty in the nation and that, while California's spending on  
          education and highways is well below the national averages,  
          California's welfare spending is excessive. The author cites a  
          2013 study that indicated 37 percent of California families  
          headed by an adult without a high school diploma are living in  
          poverty while just 20 percent of families headed by an adult  
          with a high school diploma are similarly poor.

          According to the author, SB 659 "will help move families out of  
          poverty through a holistic approach that address the root  
          problems of families in crisis and supports the overall  
          well-being of the children."  The author states that this bill  
          will "provide funding for innovative programs that are designed  









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          to guide, counsel and teach families how to transform their  
          lives and offer the tools for real change." 

          POVERTY

          The federal poverty rate is updated annually to reflect price  
          shifts in food, using a basic formula that was created in the  
          1960s.  More recently, the California Poverty Measure, published  
          by researchers at Stanford University's Center on Poverty and  
          Inequality and the Public Policy Institute of California (PPIC),  
          attempts to refine California's data to include geographic and  
          demographic differences throughout the state. 


          The California Poverty Measure takes into account costs of  
          living besides food, including transportation, child care,  
          medical out of pocket expenses. Researchers have indicated that  
          California's high poverty rate is significantly impacted by the  
          state's high housing costs and other high costs of living.  
          Children suffer the highest poverty rates. A 2014 Stanford  
          poverty center report found that 26.3 percent of young children  
          - aged 6 or younger - were below poverty under the California  
          Poverty Measure, and 24.9 percent were classified below poverty  
          using the official measure.


          The 2015 poverty threshold is reflected below. 
          
          
           ----------------------- 
          | 2015 Federal Poverty  |
          |Thresholds             |
           ----------------------- 
          |-----------+-----------|
          |Persons in |  Poverty  |
          |family/hous| guideline |
          |   ehold   |           |
          |-----------+-----------|
          |     1     |  $11,770  |
          |-----------+-----------|
          |     2     |  $15,930  |
          |-----------+-----------|
          |     3     |  $20,090  |
          |-----------+-----------|









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          |     4     |  $24,250  |
          |-----------+-----------|
          |     5     |  $28,410  |
          |-----------+-----------|
          |     6     |  $32,570  |
          |-----------+-----------|
          |     7     |  $36,730  |
          |-----------+-----------|
          |     8     |  $40,890  |
          |-----------+-----------|
          |   Each    |$4,160 per |
          |additional |  person   |
           ----------------------- 
           ----------------------- 
          | Source: US Health and |
          |Human Services Agency  |
          |                       |
           ----------------------- 
          


          TANF and CalWORKs
          
          In 1935, Congress authorized Aid to Families with Dependent  
          Children, the nation's first welfare program, amid the Great  
          Depression to stabilize the families of jobless Americans, which  
          were estimated to be one-quarter of the nation's workforce. Six  
          decades later, the AFDC cash entitlement program was replaced by  
          the Temporary Aid to Needy Families (TANF), which set time  
          limits on receipt of federal benefits, and mandated work  
          participation rates. While the federal time limit for aid is 60  
          months, California's lifetime limit for adults in the CalWORKs  
          program is 48 months, with 24 of those months contingent upon  
          meeting federal work participation requirements. 

          The CalWORKs program provided TANF cash assistance to  
          approximately 510,000 families in 2015 - including more than 1  
          million children, according to CDSS. A family's grant level is  
          determined by the number of family members and the cost of  
          living in the county, and adjustments are made based on the  
          family's income, if any.












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          In the past five years, California's CalWORKs benefit has  
          undergone significant grant cuts, the elimination of a Cost of  
          Living Adjustment, and a radical restructuring of the  
          welfare-to-work activities, requirements and time limits. In  
          2011, the lifetime limit for adults was reduced from 60 to 48  
          months. SB 1041 (Budget and Fiscal Review Committee, Chapter 47,  
          Statutes of 2012) created the Welfare-to-Work 24-month time  
          clock, which permits greater program flexibility during the  
          first 24 months, but then imposes far more rigid requirement to  
          remain eligible once the 24-month clock expires. 

          Welfare to Work
          
          Unless exempt for reasons such as disability or caregiving for  
          an ill family member, adults must participate in work or other  
          allowable activities, including job search, and certain  
          educational activities. Depending on family composition, these  
          activities are required for 20, 30, or 35 hours per week. The  
          program also offers supportive services, such as childcare and -  
          in a limited number of cases - housing support. 
          
          Efforts to refocus the welfare to work program
          
          A December 2014 report issued by the U.S. General Accounting  
          Office (GAO), underscores research that shows successful welfare  
          to work outcomes include an assessment for mental health and  
          substance abuse problems followed by appropriate therapy in  
          conjunction with work preparation activities, subsidized  
          employment programs to create work experience for participants,  
          and training for specific types of jobs. 


          Faced with budget-driven cuts to the CalWORKs program, the  
          Legislature and Governor in 2013 identified a series of services  
          to improve the outcomes of individuals within the county's  
          programs (AB 73, Budget Committee, Chapter 21, Statutes of  
          2013).  Included among those services were a statewide  
          assessment tool administered at the beginning of the program to  
          help identify barriers; intensive case management and family  
          stabilization services for those identified as having  
          significant barriers to work; additional subsidized employment  
          slots to give clients the work experience they need; community  
          college, adult education and vocational classes; a more flexible  
          "flow" within the program so that individuals can skip job club  









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          and go straight to other paths that may be better suited to  
          their background and skills.

          Family Stabilization 

          Family stabilization, which is in the process of being rolled  
          out statewide, is intended to increase client success during the  
          flexible Welfare-to-Work 24-Month Time Clock period by helping  
          stabilize clients who are in crisis. Services include intensive  
          case management with a caseworker who has a lowered caseload,  
          and supports to address barriers. A crisis that might warrant a  
          referral to family stabilization program could include  
          homelessness or imminent risk of homelessness, unsafe living  
          conditions due to domestic violence or untreated or undertreated  
          behavioral needs.

          What distinguishes family stabilization from existing practices  
          and services is the intensive case management and a more robust  
          assessment to identify less visible barriers. For the first  
          time, caseworkers also have the ability to refer other family  
          members for services if their troubles are creating a barrier to  
          employment for the adult CalWORKs participant, such as a child's  
          untreated behavioral needs. As of December 2014, there were  
          1,300 family stabilization cases opened statewide, and 40  
          percent of those receiving services were children. In the third  
          quarter of 2015, 8,261 individuals were receiving family  
          stabilization services, of which 2,551 were children.

          The state's effort to complete mandated changes to the  
          welfare-to-work program was the subject of a joint Senate Human  
          Services and Budget and Fiscal Review Subcommittee #3 hearing in  
          March 2015. Panelists testified that recent changes to the  
          program could enable families to receive more individualized,  
          career-focused services once the programs are fully implemented.

          Rapid rehousing program

          Budget trailer bill in 2014 established a rapid housing support  
          program for CalWORKs clients who were homeless. Included in the  
          program are rental assistance and security costs, as well as  
          caseworker engagement with the clients' landlord, home finding,  
          credit repair, and financial literacy. The bill allocated $20  
          million for the program to 20 counties. County plans project  
          that more than 3,000 homeless CalWORKs families will be placed  









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          in permanent housing through the program. At least one county  
          includes regular mental health counseling visits for clients.

          For 2015-16, the total funding grew to $35 million and an  
          additional 24 counties received funding, for a total of 44  
          currently participating counties. 

          Housing First 


          Housing First is an approach toward fighting homelessness that  
          provides permanent, affordable housing for homeless families and  
          individuals, and then provides supportive services in order to  
          help people avoid returning to homelessness. Housing First is  
          premised on the idea that housing should not be denied to  
          anyone, even if they are abusing alcohol or other substances. 



          According to the U. S Department of Housing and Urban  
          Development, "Housing First is an approach to quickly and  
          successfully connect individuals and families experiencing  
          homelessness to permanent housing without preconditions and  
          barriers to entry, such as sobriety, treatment or service  
          participation requirements." Under Housing First, supportive  
          services are offered to maximize housing stability and prevent  
          returns to homelessness as opposed to addressing predetermined  
          treatment goals prior to permanent housing entry. The Housing  
                                                                  First model, thus, is philosophically in contrast to models that  
          require commitment to clean and sober living in exchange for  
          housing, such as the pilot program envisioned in this bill. 



          While no bill has been introduced as of January 11, 2 016, it is  
          anticipated that legislation will be introduced this year that  
          would provide housing for the homeless based on the Housing  
          First model. 


          Constitutionality of drug testing mandates

          As introduced, this bill would have permitted random drug  
          testing in order to ensure a clean and sober environment. That  









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          language was stricken from the bill with the April 6, 2015  
          amendments.  

          Many states have introduced measures to require drug testing for  
          welfare recipients, with a significant increase during and after  
          the recession. A Congressional Research Service report issued in  
          March 2015 noted that lawmakers in a majority of states  
          reportedly proposed legislation in 2011, 2012, 2013, and/or 2014  
          that would require drug testing of beneficiaries of governmental  
          assistance under certain circumstances.<1> The report cited two  
          federal cases that found state laws conditioning eligibility for  
          new or ongoing benefits upon a drug test were unconstitutional.   
           

          In 2003, a federal appellate court in Michigan in Marchwinski v.  
          Howard ruled that subjecting every welfare applicant in Michigan  
          to a drug test without reason to believe that drugs were being  
          used, was unconstitutional. In 2013, a federal appellate panel  
          similarly struck down a 2011 Florida law under the same  
          reasoning, arguing that requiring drug testing as a condition of  
          eligibility for TANF violated the constitutional protection  
          against unreasonable searches, guaranteed under the 4th  
          amendment.

          "The court finds there is no set of circumstances under which  
          the warrantless, suspicionless drug testing at issue in this  
          case could be constitutionally applied," wrote U.S. District  
          Court Judge Mary Scriven, in her 30-page opinion on the Florida  
          case. The case was brought by Luis Lebron, a Navy veteran,  
          full-time student who had sole custody of his a 5-year-old son  
          and was caring for his disabled mother. His TANF benefit was  
          $241 per month. <2> 

          Additionally, state data in Florida show that the measure  
          produced few results: Just 108 of 4,086 people tested, or 2.6  
          percent, were found to have been using narcotics. State records  
          showed that the requirement cost more money to carry out than it  
          ---------------------------
          ---------------------------
          <1> Congressional Research Service, " Constitutional Analysis of  
          Suspicionless Drug Testing Requirements for the Receipt of  
          Governmental Benefits," March 6, 2015

          <2> Lebron v Florida Department of Children and Families, 2011









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          saved.<3> "In sum, there simply is no competent evidence offered  
          on this record of the sort of pervasive drug problem the State  
          envisioned in the promulgation of this statute," Scriven wrote.
          
          Related legislation:

          SB 855 (Budget and Fiscal Review, Chapter 29, Statutes of 2014)  
          established in the budget trailer bill a rapid housing support  
          program for CalWORKs clients who were homeless. 

          AB 74 (Budget Committee, Chapter 21, Statutes of 2013) responded  
          to a list of items developed by the CDSS stakeholder workgroup  
          established in SB 1041 and added a number of specific elements  
          to the 24-month clock, including family stabilization. These  
          supports were designed to help adults with barriers to work be  
          better prepared to enter the workforce and sustain employment.

          SB 1041 (Budget and Fiscal Review Committee, Chapter 47,  
          Statutes of 2012) made significant changes to CalWORKs' welfare  
          to work rules in the face of massive budgetary shortfalls  
          including creation of 24-month Welfare To Work time clock within  
          the state's 48 month limit.

            COMMENTS
          
          This bill would create a pilot project that would run parallel  
          to existing CalWORKs programs. The pilot program would be funded  
          with General Fund money - not federal TANF funds.  In order to  
          be eligible for a grant, programs must "assist individuals  
          receiving CalWORKs benefits to achieve economic independence."  
          However, CalWORKs enrollment is not a requirement for program  
          participation.  Therefore, the pilot programs could serve both  
          CalWORKs recipients and non-CalWORKs recipients. 

          Currently, the state and counties are rolling out family  
          stabilization programs, which would provide families with  
          identified barriers access to intensive case management, mental  
          health counseling for themselves and family members, drug and  
          alcohol treatment, domestic violence therapy and other types of  
          barrier removal.  

          ---------------------------

          <3> Robles, Frances, "Florida Law on Drug Tests for Welfare Is  
          Struck Down," New York Times, Dec. 31, 2013; 








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          The CalWORKs Housing Support Program (HSP) was created as part  
          of the 2014-15 budget agreement. In the first year, 20 counties  
          received $20 million in funding. For 2015-16, the total funding  
          grew to $35 million and an additional 24 counties received  
          funding, for a total of 44 currently participating counties. HSP  
          requires families be employed, supports financial literacy by  
          requiring they put 30 percent of their income into a savings  
          account, and it requires families to participate in regular  
          mental health therapy to obtain housing. The proposed pilot  
          contains many same or similar program components. 

          While the welfare-to-work program is subject to fairly rigorous  
          statutory limitations, including how many months a client can be  
          eligible for services, and what types of services may qualify as  
          eligible, the pilot project in this bill does not require  
          clients to adhere to the same timeline, nor does it appear to  
          require that clients complete any CalWORKs requirements. This  
          could have the effect of providing services to clients in the  
          pilot project that are more generous in duration than those in  
          the rest of the welfare-to-work program. For example, a program  
          participant could leave the pilot program after participating  
          for 24 months and then enroll in CalWORKs and receive CalWORKs  
          services for another 24 months. 

          One difference between this pilot and existing welfare-to-work  
          programs is the requirement that pilot projects include a sober  
          environment with, potentially, random drug testing of  
          participants. Federal courts have ruled in several cases that  
          conditioning benefits and services for the poor on drug testing  
          is unconstitutional, and violates protections against  
          unreasonable search. While the bill's author states that drug  
          testing would not be mandatory, as clients can opt not to  
          participate in a program funded by the pilot, it remains unclear  
          whether this requirement is constitutional, given the pilot's  
          potential link to CalWORKs

          Another difference is the centering of control over this program  
          with CDSS, rather than the counties. Currently, counties  
          contract with many community nonprofit providers in building  
          services for their welfare-to-work clients, including child care  
          referrals, mental health treatment, education and other  
          services. This bill, rather than building on those existing  









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          networks, would require CDSS to create a new grant program,  
          which would be the only one of its kind to be administered  
          directly by the state, according to CDSS.  Also, and potentially  
          more concerning, is the lack of standardization or guarantee of  
          equal access and eligibility across grantees. 
          















































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          Recommended Amendments: 
          
          Urban, Suburban and Rural Setttings

          The bill seeks $50 million from the General Fund to support the  
          grants, but it does not provide for parameters on where the  
          pilot programs receiving grants might be located.  It is  
          possible that all of the funds could be granted in one  
          community. In order to ensure communities throughout the state  
          are given the opportunity to benefit from the pilot program, the  
          committee recommends this bill be amended to further define the  
          grant participation criteria to allow one program each in urban,  
          suburban and rural settings to obtain grant funds.  This would  
          also ensure the pilot programs are sufficiently funded to  
          provide the scope of services defined in the bill.

          Periodic Progress Reports

          The bill requires CDSS to develop an ongoing evaluation,  
          utilizing objective criteria, of the effectiveness of the  
          program in teaching participants the skills necessary to achieve  
          economic independence.  The January 4, 2016 amendments require  
          the department to develop a periodic progress report for the  
          duration of the project.  The difference between the evaluation  
          criteria and the progress report is unclear, and the two reports  
          appear to be duplicative. The Committee recommends removal of  
          the "periodic progress report" from the bill. 

          Criminal Background Checks for Volunteer Child Care Providers

          The bill currently requires "each participating child care  
          provider" to obtain a criminal record clearance pursuant to  
          Section 1596.871 of the Health and Safety Code.  According to  
          the author's office, the bill is modeled after a program in  
          which program participants might gain work experience as  
          volunteers by providing childcare services.  Under such a  
          program, both employees and volunteers may provide childcare  
          services.  Therefore, the committee recommends amending the bill  
          to expressly state that "each participating childcare provider"  
          includes both employees and volunteers.  This would ensure all  
          childcare providers are properly screened.

          Sober Living Policy









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          The bill would require pilot programs to provide a clean and  
          sober environment, but there are some questions about how that  
          would be enforced.  For example, what would happen if a  
          participant was suspected of being under the influence of drugs  
          or alcohol and who would determine when or how a participant  
          might be terminated from the program?  The committee recommends  
          clarifying these questions by requiring the pilot programs to  
          adopt a sober living policy that would ensure that program  
          participants are aware of their expectations and the  
          consequences of violating the policy.  

          Drug Testing

          The pilot programs would serve both CalWORKs recipients and  
          non-recipients.  It would be funded via General Fund, not TANF  
          funds, and "criteria for eligibility set by the organization do  
          not affect an individual's eligibility for CalWORKs benefits."   
          Therefore, it appears that CalWORKs recipients who participate  
          in a pilot program would not lose their welfare supports if they  
          were terminated from the pilot program as a result of a failed  
          drug or alcohol test.

          As discussed previously in this analysis, mandatory drug testing  
          of welfare recipients, as a condition of receiving welfare  
          benefits has been found to be unconstitutional.  As it currently  
          reads, this bill would allow, but not mandate, drug testing of  
          pilot program participants.  According to the author's office,  
          drug testing is an essential feature of the existing programs on  
          which the bill is modeled.   This approach is inconsistent with  
          the Housing First model. The committee recommends amending the  
          bill to state that program participants may not be required to  
          submit to drug or alcohol testing. 

          Temporary Housing

          The bill does not include housing as mandatory program element.   
          According to the author's office, the pilot programs are  
          intended to provide temporary housing, along with the other  
          services outlined in the bill.  Therefore, the committee  
          recommends that the bill be amended to state that temporary  
          housing is a mandatory program element.  

          Coordination and Collaboration with County Human Services









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          The County Welfare Directors Association of California (CWDA)  
          has requested amendments that would enhance coordination and  
          collaboration between pilot project organizations and county  
          human services agencies. Specifically, CWDA suggested that the  
          department take into consideration the extent to which a grant  
          applicant has conferred with and collaborated with county human  
          services agencies.  CWDA also suggested that the pilot projects  
          must collaborate and coordinate with county human services  
          agencies on procedures for CalWORKs referrals, progress reports  
          and other communications. The committee recommends accepting  
          these amendments. 

          Medical Service for Program Participants

          The bill is currently silent on medical services for program  
          participants.  In order to ensure program participants would  
          have access to the full scope of medical services, the committee  
          recommends that the bill be amended to require that programs  
          shall not limit the participants' ability to access a full scope  
          of physical, psychosocial and mental health services.  

          Anti-Discrimination

          While existing law, Government Code section 11135, already  
          prohibits denial of state services and discrimination based on  
          any protected class, the committee recommends including  
          compliance with this Government Code section 11135 in the  
          criteria for pilot program participation.  This would ensure  
          pilot programs are not excluding certain groups from the program  
          or mandating participation in religious activity. 

          Additional staff comments: 


          Should this bill pass out of Senate Human Services Committee, it  
          would be helpful for the author to further address the following  
          issues which have been raised by interested parties: 

             1)   Would or could participation in the pilot program meet  
               certain welfare to work requirements for CalWORKs  
               recipients?  
             2)   Allowing pilot programs to set their own eligibility  
               requirements might allow programs to exclude certain groups  









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               of people who might otherwise be eligible for state funded  
               services.  How might the state set parameters for program  
               participation eligibility? 
             3)   Welfare recipients have a very strict timeclock set on  
               their eligibility requirements.  Should a similar time  
               limit be set for the pilot programs? 




                          Mock Up of Amendments for SB 659

               ******** To be taken in Senate Appropriations Committee  
                                     ********* 

          

          SECTION 1. The Legislature finds and declares all of the  
          following:

          (a) California is expected to spend $142 billion on health and  
          human services programs this year, which is by far the largest  
          state budget expenditure, while total education spending for  
          kindergarten, grades 1 to 12, inclusive, and higher education  
          programs is only $80 billion per year.

          (b) California has the fifth largest Temporary Assistance for  
          Needy Families (TANF) cash grant in the nation, and the second  
          largest amongst the 10 largest states, yet poverty remains a  
          persistent problem.

          (c) We must recognize that California's problems of poverty and  
          inequality do not stem from a lack of safety net programs.

          (d) California's social safety net needs to invest in programs  
          that elevate people out of poverty rather than helping people  
          live better in poverty.

          SEC. 2. Article 3.7 (commencing with Section 11337) is added to  
          Chapter 2 of Part 3 of Division 9 of the Welfare and  
          Institutions Code, to read: 

            










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                   Article  3.7. Opportunity Grant Pilot Project  

          11337. (a) The State Department of Social Services, in  
          consultation with the County Welfare Directors Association of  
          California, shall, no later than July 1, 2017, design and  
          implement a five-year pilot project under which monetary grants  
          are provided to organizations operating programs that assist  
          individuals receiving CalWORKs benefits achieve economic  
          independence.

          (b) In developing the pilot project described in subdivision  
          (a), the department shall, at a minimum, do all of the  
          following:

          (1) Develop a competitive review process for all grant proposals  
          submitted and a methodology to determine grant amounts.  To the  
          extent possible, the competitive review process shall ensure  
          that funding is granted to programs that are located in three  
          total regions: one urban, one suburban and one rural.   

          (2) Develop eligibility requirements for organizations seeking a  
          grant. The eligibility requirements shall, at a minimum, require  
          an organization's program to include all of the elements  
          specified in subdivision (d). The eligibility requirements for  
          organizations seeking a grant do not affect an individual's  
          eligibility for CalWORKs benefits, as determined by the county.

          (3) Develop an ongoing evaluation, utilizing objective criteria,  
          of the effectiveness of an organization receiving grant funding  
          in teaching its program participants the skills necessary to  
          achieve economic independence. The evaluation criteria shall, at  
          a minimum, include an examination of all of the following:

          (A) The number and percentage of participants that complete the  
          program.

          (B) The number and percentage of program participants that begin  
          the program with a high school diploma or equivalent.

          (C) The number and percentage of program participants that  
          achieve a high school diploma or equivalent while in the  
          program.

          (D) The number of program participants that obtain nonsubsidized  









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          employment of at least 20 hours per week by the time of program  
          completion, with regular followup to determine if this minimum  
          level of nonsubsidized employment is maintained for the duration  
          of the ongoing evaluation required by this paragraph.

          (E) The attainment of academic stability for the children of  
          program participants. The department shall develop a definition  
          of academic stability for purposes of this section.

          (F) The number and percentage of program participants still  
          receiving CalWORKs benefits upon completion of the program.

          (G) The average income of program participants at the time of  
          program completion.

          (H) The number and percentage of program participants that  
          achieve family reunification, when applicable.

           (4) Develop a periodic progress report for the duration of the  
          pilot project.

           (c) The department may enter into an agreement with an academic  
          institution or other entity with sufficient expertise for the  
          purpose of creating, performing, or both creating and performing  
          the evaluation required by paragraph (3) of subdivision (b). The  
          department and any academic institution or other entity the  
          department contracts with to create, perform, or both create and  
          perform the evaluation shall seek input from stakeholders during  
          the development process.

          (d) In order to be considered for a grant, an organization  
          shall, at a minimum, include all of the following elements in  
          its program:

          (1) Education focused on the attainment of a high school diploma  
          or its equivalent.

          (2) Mental health services.

          (3) Employment training.

          (4) Financial training.

          (5) Parenting skills training.









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          (6) Life skills training.

          (7) Child care services. Each participating child care provider  
          shall obtain a criminal record clearance pursuant to Section  
          1596.871 of the Health and Safety Code.  Child care providers  
          subject to this section includes paid employees and volunteers   
          If the organization serves only pregnant women, the organization  
          shall not be required to provide child care services to be  
          eligible for grant funding.

          (8) A clean and sober environment.   Each pilot program must  
          establish a sober living policy. Determination that a program  
          participant is not in compliance with the sober living policy is  
          at the discretion of the program's on-site manager.  Violation  
          of the sober living policy is grounds to terminate a participant  
          from the pilot program.  Mandatory testing for drug or alcohol  
          use, for pilot project participants only, is prohibited. 

           (9) Comprehensive, targeted case management to assist program  
          participants.

          (10) Ongoing monitoring of program participants for at least  
          five years after they have completed the program for purposes of  
          measuring long-term program effectiveness.

          (11) Trauma-informed social work.

           (12) Temporary housing on a 24 hours a day, seven days a week  
          basis, which includes food facilities.

          (e) The organization shall demonstrate in its grant application  
          how it will coordinate its program with CalWORKs requirements.  
          In considering the applications received and determining which  
          organizations to award grants, the Department shall take into  
          consideration the extent to which an organization seeking  
          funding has conferred with and is collaborating with the county  
          human services agency or agencies that would be asked to refer  
          CalWORKs recipients to its program. 

            (e)   (f)  An organization receiving a grant may utilize the grant  
          funds in any reasonable manner, as long as the funds are  
          expended in furtherance of the program elements or other  
          requirements the department establishes. Housing,  









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          transportation, and child care expenses for program participants  
          shall be considered an allowable use of grant funds.

           (g) An organization receiving a grant shall not limit  
          participants' ability to access a full scope of physical,  
          psycho-social and mental health services.  

           (h) An organization receiving a grant must comply with Section  
          11135 of the Government Code. 

            (f)   (i)  (1) The benefits an individual may receive through  
                                            participation in a program receiving grant funding are in  
          addition to any other public assistance benefits for which the  
          individual may be eligible.

          (2) Organizations receiving grant funding may set their own  
          eligibility criteria for their programs as long as the  
          eligibility criteria are consistent with the goals of this pilot  
          project. The criteria for eligibility set by the organization do  
          not affect an individual's eligibility for CalWORKs benefits, as  
          determined by the county.

          (3) Organizations receiving grant funding shall contact the  
          county welfare department upon being notified of the grant and  
          shall make a good faith effort to coordinate their programs with  
          CalWORKs requirements.

           (3) Organizations receiving grant funding shall contact the  
          county welfare department upon being notified of the grant and  
          shall make a good faith effort to coordinate their programs with  
          CalWORKs requirements.

            (3) Organizations receiving grant funding shall collaborate and  
          coordinate with the county human services agency or agencies  
          that will be asked to refer CalWORKs recipients to the program  
          in implementing procedures for referrals, regular progress  
          reports, and other communication as needed.

            (g)   (j)  Participation in a program administered by an  
          organization receiving grant funding pursuant to this section is  
          voluntary.

           (h)   (k)  (1) No later than December 31, 2021, the department, or  
          the academic institution or other entity the department  









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          contracted with pursuant to subdivision (c), shall send a report  
          evaluating the effectiveness of the programs funded by the  
          grants to the relevant policy and fiscal committees of the  
          Legislature. The report shall also be posted on the department's  
          Internet Web site.

          (2) The report required by paragraph (1) shall not reveal the  
          identity of any program participant, nor shall it contain any  
          personally identifiable information.

          (3) The report required by paragraph (1) shall be submitted in  
          compliance with Section 9795 of the Government Code.  

          11338. This article shall become inoperative on July 1, 2022,  
          and, as of January 1, 2023, is repealed, unless a later enacted  
          statute, that becomes operative on or before January 1, 2023,  
          deletes or extends the dates on which it becomes inoperative and  
          is repealed.

          SEC. 3. The sum of fifty million dollars ($50,000,000) is hereby  
          appropriated from the General Fund to the State Department of  
          Social Services for purposes of funding the pilot program  
          developed pursuant to Article 3.7 (commencing with Section  
          11337) of Chapter 2 of Part 3 of Division 9 of the Welfare and  
          Institutions Code.



            POSITIONS
                                          
          Support:       
               Community Action Agency of Butte County 
               County Welfare Directors Association of California
               Esplanade House 
               Solutions for Change
               Lutheran Office of Public Policy
               Western Center on Law and Poverty

          Oppose:   
               None.
                                      -- END -

          










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