BILL ANALYSIS Ó
AB 2352
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Date of Hearing: April 24, 2012
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Jim Beall Jr., Chair
AB 2352 (Roger Hernandez) - As Introduced: February 24, 2012
SUBJECT : CalWORKs eligibility: asset limits: vehicles
SUMMARY : Deletes the requirement that county welfare
departments assess the value of a vehicle when determining and
re-determining eligibility for applicants and recipients of
California Work Opportunity and Responsibility to Kids program
(CalWORKs).
EXISTING LAW :
1)Establishes the CalWORKs program to provide welfare-to-work
services to qualifying persons.
2)Limits the amount of income and personal and real property an
individual or family may possess in order to be eligible for
aid under the CalWORKs program, including that assets shall
not exceed the following:
a) $2,000 in savings and $3,000 for a family with a member
age 60 or above;
b) One house that the family lives in;
c) One car with a value of $4,650 or less; and,
d) Savings and interests in restricted federally qualified
accounts for the purpose of saving for college, retirement,
starting a business, purchasing a home, or overcoming an
episode of homelessness.
FISCAL EFFECT : Unknown
COMMENTS : The author states that:
The primary goal of the CalWORKs program is to move
families out of poverty and towards self-sufficiency.
One of the key components of the program is requiring
adult participants to either work or receive some type
of training that will help them get a job. The
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vehicle limit was originally designed to allow
families to retain a reliable car in order to find and
maintain employment. However, the existing vehicle
asset test proves to be a hindrance to families whose
vehicle value is slightly above the limit because they
face the choice between disposing of their automobile
and foregoing needed cash assistance. This proposal
is an important step towards reducing the barriers to
eligibility and increasing access to CalWORKs for
those who are in need.
The author points out that the ongoing economic downturn and the
state's fiscal crisis continue to negatively and detrimentally
affect Californians. With 12.5% of California's workforce, the
author notes, currently unemployed people are facing incredible
challenges in order to meet their basic needs. As a result, a
growing number of families and individuals have turned to the
CalWORKs program for assistance. The author says that, as of
September 2010, 576,845 California families relied on the
state's welfare-to-work program. In LA County alone, about
13,000 families apply for CalWORKs each month.
A recent report by the County of Los Angeles on the
transportation barriers faced by low-income families concludes
that "car ownership is strongly correlated with employment
status, and increases the likelihood of employment." The study
found that welfare-to-work recipients without a vehicle were 31%
more likely to indicate that they face difficulty in seeking
work, while those with a vehicle were 20% more likely to be
gainfully employed.
The intent of this bill is to encourage CalWORKs families to
build their personal savings and asset accumulation in order to
become self-reliant and end their dependence on government
assistance. An additional goal is to reduce the administrative
burden on local welfare agencies by streamlining the application
process, simplifying the program rules, decreasing paperwork and
cutting down on county time that would be better served on the
other human services programs it is entrusted by the state to
administer. The author reports that, according to the New
America Foundation, less than one tenth of one percent of all
CalWORKs cases exceeds the vehicle limit. Repealing the vehicle
asset test, the author says, would have a negligible impact on
the General Fund.
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Other States
The federal TANF program allows significant state flexibility on
eligibility rules for families applying to CalWORKs for cash and
employment assistance. Specifically, states can decide the
income level and property or asset levels that an applicant or
recipient must meet in order to be eligible. In California,
asset limits restrict families to no more than $2,000 in savings
(including some retirement and higher education savings) and to
one car with a value of no more than $4,650.
California's vehicle asset test, which was last increased 16
years ago, is one of the nation's most restrictive. According
to the author, California is currently tied with Texas and Idaho
in having the most restrictive asset test for vehicles of any
state in the country: Twelve states exclude all vehicles owned
by the household; fifteen exclude at least one vehicle per
household; and twenty have substantially increased the value of
the vehicle exclusion. The author says that California's
restrictive vehicle asset policy undermines workers' ability to
gain and maintain employment, thereby encouraging continued
reliance on public assistance.
Arguments in Support
In support of this bill, the California State Association of
Counties says that this bill "would increase the opportunities
for recipients to find and maintain stable employment, while
also increasing the state's work participation rate, reducing
grant cost in the long run, and helping avoid federal
penalties." The County Welfare Directors Association of
California (CWDA) similarly says that this bill "would enable
ÝCalWORKs participants] to drive to their jobs, child care,
treatment and counseling, and other needed services, increasing
the state's work participation rate, reducing grant costs and
helping to avoid federal penalties." CWDA points out that the
"primary goal of the CalWORKs program is to move families out of
poverty and towards self-sufficiency." This bill, CWDA
concludes, "is an important step towards reducing the barriers
to eligibility and increasing access to CalWORKs for those who
are in need."
Prior legislation :
AB 1058 (Beall), 2009-10 would have deleted the requirement that
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county welfare departments assess the value of a vehicle when
determining a CalWORKs' application or recertification. Died in
the Senate Appropriations suspense file.
AB 2368 (Fuentes), 2007-08 would have eliminated the vehicle
asset test for CalWORKs applicants and recipients. Died in the
Senate Appropriations suspense file.
AB 2480 (S. Runner), 2007-2008 would have amended the CalWORKs
eligibility vehicle asset limit by adding leased vehicles to the
list of countable resources. Failed passage in the Assembly
Human Services Committee.
AB 1078 (Lieber), Chapter 622, Statutes of 2007, in addition to
EITC awareness provisions, excluded funds in specified
retirement and educational accounts authorized under federal law
from being considered as income or resources for purposes of
CalWORKs benefits for applicants.
AB 167 (Bass), 2007-08 would have eliminated the CalWORKs asset
test for applicants and recipients. Died in the Senate
Appropriations suspense file.
AB 2466 (Daucher and Arambula), Chapter 781, Statutes of 2006,
excluded funds in specified retirement and educational accounts
authorized under federal law from being considered as income or
resources for purposes of CalWORKs benefits for current
recipients, not for new applicants. In addition, it added
financial management education as an allowable welfare-to-work
activity for adults receiving CalWORKs benefits.
REGISTERED SUPPORT / OPPOSITION :
Support
American Association of University Women
California Catholic Conference
California Family Resource Association
California Partnership to End Domestic Violence
California State Association of Counties (CSAC)
Coalition of California Welfare Rights Organizations
County Welfare Directors Association of California (CWDA)
Laborers' Locals 777 & 792
Regional Council of Rural Counties
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Opposition
None on file
Analysis Prepared by : Eric Gelber / HUM. S. / (916) 319-2089