BILL ANALYSIS
AB 1866
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Date of Hearing: March 23, 2010
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Jim Beall, Jr., Chair
AB 1866 (Audra Strickland) - As Introduced: February 12, 2010
SUBJECT : Public assistance: home visits
SUMMARY : Requires an inspection of all homes for applicants to
the California Work Opportunity and Responsibility to Kids
Program (CalWORKs). Specifically, this bill :
1)Requires, statewide, a welfare fraud investigator to make a
"home call" to verify a preliminarily approved CalWORKs
applicant's eligibility, and to report the finding to the
appropriate county officials before the application receives
final approval.
2)Defines a home call as a brief interview of the applicant and
walk-through of the residence while taking into consideration
the following criteria:
a) Whether the applicant actually lives at the residence;
b) Whether there are paycheck stubs or other evidence of
unclaimed income present in the residence;
c) Whether there are other assets at the residence;
d) Whether the applicant has any residency or criminal
history problems that would prohibit the receipt of aid;
e) Whether a claimed absentee parent is actually living at
the residence;
f) Whether there is evidence, such as diapers or other
child care items, to confirm the presence of children
claimed to reside with the applicant;
g) Whether collateral contacts with landlords, neighbors,
and school officials corroborate the information provided
in the application; and
h) Any other relevant criteria established by the district
attorney.
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3)Declares that citizens of California should be assured that
public assistance benefits are only awarded to those who
legitimately require and are qualified to receive those
benefits; and finds that the County of San Diego's "Project
100 Percent" identified on average that 25% of "preliminarily
approved" CalWORKs applicants were ineligible for assistance.
EXISTING LAW:
1)Requires CalWORKs applicants to:
a) Submit specified documents to prove that their income
and assets comply with program rules, and
b) Report, on an ongoing quarterly basis, income to prove
continued compliance with program rules.
2)Requires, through the Statewide Fingerprint Imaging System,
all adults living in the household be finger-imaged and
photographed.
3)Requires, under federal law, that each state implement a
system to check for duplicate aid. In California, this is
called the Income Eligibility Verification System (IEVS). A
system that performs frequent and periodic match checks
against specified government databases.
FISCAL EFFECT : Unknown
COMMENTS : It is a widely held belief that program integrity is
an essential component to taxpayer-funded programs.
Policymakers are charged with ensuring that program integrity
systems function properly to catch the undeserving while
ensuring that they do not present a barrier to benefits for the
deserving.
For public assistance programs in particular-CalWORKs, Food
Stamps, In Home Supportive Services, etc.--there are several
systems in place that protect against the abuse of public funds.
Because this bill applies solely to CalWORKs, this analysis
will only discuss CalWORKs.
CalWORKs eligibility verification process : Upon application,
there are a number of systems that the administrators of
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CalWORKs employ to verify that an individual meets and continues
to meet program eligibility rules.
1)Federal regulations require states to implement a system to
detect duplicate aid using, at a minimum, Social Security
numbers, birth dates, and addresses.
2)Applicants must submit evidence of their income every three
months (49 states only require this every six months).
3)County eligibility workers are required to verify the asset
information provided by clients. Duplicate and fraudulent aid
is further limited by the work requirements that recipients
must participate in.
4)In addition to all these fraud protections, the state requires
counties to take a biometric fingerprint of all adult
recipients, even those not on the grant, and match them
against data bases.
5)County eligibility workers also use IEVS to conduct daily,
monthly, and quarterly computerized checks to verify income,
including unreported income. IEVS is a comprehensive computer
match system that submits an applicant or recipient's
information through several different databases to ensure
compliance with CalWORKs program rules.
a) IEVS matches at application include:
i) Income matches : The Employment Development
Department (EDD) provides unemployment insurance or
disability insurance claims information the client can
draw on prior to receiving welfare (includes any payments
made to existing claims and the dates and amounts of each
check issued.
ii) Social Security Status : Validates Social
Security Numbers (SSN) and provides Social Security
information on Title II and Title XVI.
iii) Citizenship match : Immigration and
Naturalization Service provides information on the
applicant's immigration status.
iv) Homeless income : Identifies payments to
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homeless individuals.
v) Undeclared Assets match : Checks the state Franchise
Tax Board (FTB) for any interest, dividends, and unearned
income the applicant may not have listed.
vi) Overpayments match : Identifies applicants who
may have prior outstanding CalWORKs and Food Stamp debts.
vii) Prisoner Match : Includes information from the
Social Security Administration on individuals whose
period of incarceration exceeds thirty days within the
California Department of Corrections, federal prisons or
institutions, or other states' jails, prisons, and
incarceration facilities.
b) IEVS matches for recipients (on a monthly to annual
basis):
i) Integrated Earnings Clearance/Fraud Detection System
(Quarterly): This system matches cash aid, Food Stamps,
MediCal, General Assistance/General Relief if Food Stamps
are included, against EDD's quarterly wage information
from California employers. This match also provides a
Duplicate Aid Match when two or more records contain
certain information.
ii) Payment Verification Systems Monthly) Matches :
recipient file against EDD US/DI and SSA Title II Benefit
file.
iii) Beneficiary Earnings Exchange Record (Monthly ):
This system is matched on new recipients or persons who
are newly added to the case and a yearly match on all
eligible recipients.
iv) Deceased Persons Match (Semi-annually ): Matches on
SSN deceased person data file with recipient's to verify
and ensure the Food Stamp and CalWORKs benefits are not
issued to individuals using SSN of the deceased
individuals.
v) Franchise Tax Board (FTB) Asset Match (Annually) :
This system matches the welfare recipient file against
the state's FTB interest, dividend, and other sources of
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unearned income file. This match shows only the interest
and dividend income earned from the assets, not the
account balances.
vi) Internal Revenue Service (IRS) Asset Match
(Annually) : This system matches the welfare recipient
file against the IRS unearned income file. This match
shows unearned income reported to IRS for out-of-state
accounts, interest, dividends, lottery winnings, stocks
and bonds, Individual Retirement Agreements, mortgage
interest, and any other unearned income not found on
FTB's file.
vii) Nationwide Prisoner Match (Monthly ): This system
matches all federal, state and local correctional, penal
or other detention facilities including city, county and
multi-jurisdictional jails, work and boot camps,
residential halfway houses, detention centers, and mental
health and medical facilities housing prisoners behalf of
correctional institutions against the welfare file.
viii) Fleeing Felon Match (Monthly) : This system
matches CalWORKs and Food Stamp recipients against the of
Justice's Wanted Persons File to determine ineligibility
of public assistance.
ix) California Youth Authority Match (Monthly) : This
system matches CalWORKs, Food Stamp, and MediCal
recipients who are eligible in the current month and
first previous month against individuals that are
incarcerated for at least 30 consecutive days.
x) New Hire Registry (Monthly) : This system matches
CalWORKs, Food Stamps, and MediCal recipients against
EDD's New Employee Registry where employers are required
to report to California all new hires, rehires, and
employees returning to work within 20 days from the start
of work.
Purpose of this bill : The author believes that there are many
fraudulent applications being submitted to county welfare
offices by those trying to game the system. Her goal is to
provide accountability to California's welfare system by
requiring that a welfare fraud investigator make a home visit to
every applicant with the purpose of physically confirming
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information provided on the CalWORKs application. She contends
that the home visit method will reduce the number of fraudulent
applications and, in turn, reduce the amount of benefits paid to
make room for legitimate applicants. The source of the bill is
based on San Diego County's experience with its pilot project,
called Project 100 Percent, a home visit program that is now
over a decade old.
San Diego's Project 100 Percent : Started in 1997, this project
requires a home visit to every CalWORKs applicant within 10 days
of application. In its early years, San Diego stated that it
found a 25% fraud rate in its CalWORKs applications.
The author submits that San Diego's District Attorney's Office
found the following rates of fraud in that county: In 2005,
4,770 home calls were made out of which 19% of applications were
found to be fraudulent yielding cost savings of $528,691 for
just one month. In 2006, 3,031 home visits were conducted out
of which 19% of applications were found again to be fraudulent
yielding $470,640 in cost savings for one month.
Using the above data from San Diego County's Project 100
Percent, the author outlines the cost savings of denying
benefits to applicants based on a successful home visit.
Project 100 Percent currently employs four full-time
investigators at a total annual cost of $400,000. In 2006,
these four investigators made approximately 3,000 home visits
where due to question raised by the investigators led to savings
of at least $500,000. The author explains that this amount was
derived on the basis of one month's grant cost for each case
flagged by the investigator, and followed up and verified by the
county's human services department as ineligible. San Diego
County reports that families are on aid an average of 25 months,
so savings could be significantly higher.
Opposition :
The opposition makes many arguments for why home visits should
not be allowed statewide. Supportive Parents Information
Network (SPIN), a non-profit organization staffed by volunteers
whose mission is helping low-income families achieve
self-sufficiency, states that it "has represented innumerable
parents over the years who have challenged a denial based on
Project 100 Percent investigations...and have rarely taken a
case to a hearing because the bases of the denials are so
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unreasonable that we can resolve the matter." Some of these
unreasonable bases cited by SPIN are:
1) Presence of even one item of men's clothing makes the
investigator assume that a male lives in the home, no
matter the explanation (e.g., female applicant wore work
pants to the job, jacket belonged to the brother or son,
shoes belonged to the teenage son).
2) Parent not home for investigator's first or second
unannounced visit and the investigator reports no
verification of residency.
3) Male relative or friend visiting the home during the
home visit and the investigator assumes male lives in the
home.
The Western Center on Law & Poverty (WCLP) points out that it
supports efforts to eliminate fraudulent claims for aid, but
note, however, that the CalWORKs system already contains a
number of measures designed to prevent fraud. Additionally, WCLP
questions whether Project 100% really works. It asked Professor
Richard Berk of UCLA to analyze the data from Project 100% in
2002. Professor Berk raised serious questions about the data,
noting that the county failed to perform before and after
pre-experiments to determine if the home visits were the cause
for caseload declines or fraud discovery. The results could be
simply from broader caseload declines (California's CalWORKs
caseload has declined by nearly 50% since 1997) or other changes
in program design such as work requirements.
The County Welfare Directors Association (CWDA) opposes this
bill because it believes that "a one-size-fits-all" model for
ensuring program integrity is neither appropriate nor effective.
CWDA explains that a number of models (e.g., early fraud
detection, county employment home visits) have proven effective
in promoting program integrity. Based on their review, it
appears that other large Southern California counties are
achieving comparable results to San Diego by employing models
other than the one specified in this bill.
The Coalition of California Welfare Rights Organizations, Inc.
is opposed to this bill. It believes that their very
conservative cost estimate of home visiting every CalWORKs
applicant will lead to a cost of $53 million per year, and will
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require 1,000 new welfare fraud investigators.
Among other reasons, the California State Association of
Counties (CSAC) opposes this bill because of its additional
workload and resulting additional costs. CSAC states that this
bill would exacerbate the already stretched-thin county
eligibility infrastructure in most counties. It adds that
because of the state's significant budget deficits, counties
have been repeatedly under-funded resulting in county hiring
freezes and furloughed or laid-off workers and therefore reduced
services. This bill would add another mandate to the county
workload.
Related legislation :
AB 631 (Tran): 2009-2010 would have required a home visit to a
CalWORKs applicant's home to verify eligibility. Failed passage
in the Assembly Human Services Committee.
AB 1193 (Strickland) 2009-2010 would have required a home visit
to a CalWORKs applicant's home to verify eligibility. Died in
the Assembly Human Services Committee.
AB 1479 (Duvall) 2009-2010 would have required a home visit to a
CalWORKs applicant's home to verify eligibility. Died in the
Assembly Human Services Committee.
SB 269 (McClintock) 2007-2008 would have would have established
a statewide requirement for all welfare applicants to
participate in a home visit from a District Attorney's Office
investigator within 10 days of application. Failed passage in
the Senate Human Services Committee.
SB 786 (McClintock) 2005-2006 would have established a statewide
requirement for all welfare applicants to participate in a home
visit from a District Attorney's Office investigator within 10
days of application. Failed passage in the Senate Human
Services Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
Bonnie M. Dumanis, San Diego County District Attorney
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Opposition
CA State Association of Counties (CSAC)
Coalition of California Welfare Rights Organizations, Inc.
County Welfare Directors Association of CA (CWDA)
Supportive Parents Information Network
Urban Counties Caucus
Western Center on Law and Poverty
Analysis Prepared by : Frances Chacon / HUM. S. / (916)
319-2089