BILL ANALYSIS
AB 2004
Page 1
Date of Hearing: May 5, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2004 (Beall) - As Amended: April 20, 2010
Policy Committee: Human
ServicesVote:4 - 1
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill requires the Department of Social Services (DSS) to
create a civic works employment program that would be funded
with Temporary Assistance for Needy Families (TANF) - Emergency
Contingency Funds (ECF). Specifically, this bill:
1)Requires DSS to "launch" a civic works employment program in
at least five counties, within four weeks of any federal
extension of TANF - ECF.
2)Requires DSS to work collaboratively with county governments
to identify local and state infrastructure projects that can
be completed by persons participating in a TANF - ECF wage
subsidy program.
3)Requires DSS to issue any necessary all county letters or
other instructions to clarify eligibility criteria and provide
a framework for a wage subsidy program using TANF - ECF, as
specified.
4)States that it is the intent of the Legislature that all
Californians benefit from TANF - ECF funding.
FISCAL EFFECT
1)Currently, 45 counties are using TANF - ECF funding to provide
an enhanced subsidized employment program. By the end of the
fiscal year, they anticipate spending approximately $134
million on subsidized employment. Assuming the 13 remaining
counties create similarly robust subsidized employment
programs through DSS guidance and technical assistance, it
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would result in an additional $31 million in TANF - ECF
spending and would require a state or county investment of
$7.8 million.
Current estimates suggest that the state will be spending over
$1 billion of that money in 2009-10 and 2010-11 (at least $500
million each year on CalWORKs grants alone). If the deadline
for expending TANF - ECF funding is extended, California will
be able to draw down its full share of TANF - ECF, regardless
of this legislation.
In addition, CalWORKs currently allows counties great
flexibility in designing employment programs that they deem
will best meet the specific needs of their CalWORKs
participants. By requiring the development of a public works
subsidized employment program, this legislation could result
in a diversion of funds that could otherwise be used in an
arguably more effective way to serve participants.
2)State workload costs associated with identifying
infrastructure projects, developing county guidance on
subsidized employment programs, and creating a civic works
subsidized employment program would likely exceed $750,000 GF.
3)It is unclear from the author's intent language how he intends
for all Californians to benefit from TANF - ECF funding;
whether he intends for all Californians to receive some sort
of cash stipend or is referring to the societal benefit
associated with providing jobs for those who are currently
unemployed. If the intent is to provide cash assistance to all
Californians, it would result in a significant redirection for
TANF - ECF from the CalWORKs program and would not be
allowable under federal law.
COMMENTS
1)Purpose . This bill is intended to create a subsidized public
works employment program for CalWORKs recipients using TANF -
ECF money. The bill would further require that at least five
counties participate in the program. Though 47 of 58 counties
are currently running subsidized employment programs, the
author is concerned that not all counties have drawn down TANF
- ECF funding for subsidized employment. By requiring the
creation of a new program and providing technical assistance
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to counties to help them set up programs, the author hopes
that CalWORKs participants in the remaining counties will be
able to benefit from a subsidized employment program.
2)TANF Contingency Fund . On February 17, 2009, the president
signed the American Recovery and Reinvestment Act of 2009
(ARRA), which establishes the Emergency Contingency Fund for
State TANF Programs (ECF). This legislation provides up to $5
billion to help states, territories, and tribes in federal
fiscal years 2009 and 2010 that have an increase in assistance
caseloads or in certain types of expenditures.
States can request grants from this fund if they meet any of
the following eligibility requirements:
a) Caseload increases and increased expenditure on basic
assistance.
b) Increased expenditures related to non-recurrent,
short-term benefits.
c) Increased expenditures for subsidized employment.
States will receive 80% federal funding for any expenditures
that meet the ECF criteria.
According to the United States Department of Health and Human
Services, California is eligible for up to $1.8 billion in
TANF emergency contingency funds over the two-year period,
should increased expenditures justify the funding. In
addition, states are hoping that TANF - ECF will be extended
an additional year, to 2011, to allow states the opportunity
to draw down more of their available funding. Currently,
congress is working to include that extension in a jobs bill
that would also extend unemployment benefits.
3)Committee Concerns . As written this legislation would require
DSS to develop and implement a civic works employment program
in five counties within four weeks of a federal extension of
TANF - ECF. It is unlikely that a program of that complexity
could be created and implemented within a six-month time
period, much less within four weeks.
In addition, as written, this legislation would require DSS to
work with county governments to identify appropriate state and
local infrastructure projects that could benefit from
subsidized employment programs. The author may wish to
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include CalTRANS, the state agency that oversees most
statewide infrastructure projects, in any effort to develop a
subsidized employment program that would involve their
projects.
Finally, the committee would recommend that the author delete
the intent language that states all Californians should
benefit from TANF - ECF. The intent and purpose of this
language is not clear.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081