BILL ANALYSIS Ó
AB 2352
Page 1
ASSEMBLY THIRD READING
AB 2352 (Roger Hernández)
As Introduced February 24, 2012
Majority vote
HUMAN SERVICES 5-0 APPROPRIATIONS 12-5
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|Ayes:|Beall, Jones, Ammiano, |Ayes:|Fuentes, Blumenfield, |
| |Hall, Portantino | |Bradford, Charles |
| | | |Calderon, Campos, Davis, |
| | | |Gatto, Hall, Hill, Lara, |
| | | |Mitchell, Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Norby, Wagner |
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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,
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starting a business, purchasing a home, or overcoming an
episode of homelessness.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1) Ongoing savings in the CalWORKs program of $4
million Temporary Assistance for Needy
Families/maintenance of effort (TANF/MOE) per year:
a) Increased grant costs of $357,000 (TANF/MOE)
for 2012-2013, increasing to $4.2 million (TANF/MOE)
in 2014-15 due to an increased CalWORKs caseload.
b) Savings of $5 million (TANF/MOE) in 2012-2013,
growing to approximately $10 million (TANF/MOE) in
2014-2015 and beyond due to reduced administrative
workload.
2) Actual administrative savings would likely be less
as the CalWORKs program has not received funding
increases to keep pace with actual operations costs
since 2001. In addition, county welfare departments
have sustained hundreds of millions of dollars of cuts
over the last several years. However, reducing the
workload associated with CalWORKs eligibility would
help relieve the funding pressures faced by county
welfare departments.
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
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
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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 Los Angeles 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 0.1% 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.
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
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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: 12 states exclude all vehicles owned by
the household; 15 exclude at least one vehicle per household;
and 20 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 1182 (Roger Hernández) of the current
legislative session, 2011-12, which was virtually identical to
this bill, was vetoed. In his veto message, the governor noted,
"In the last year, the state has been forced to make steep
reductions in many programs, including the state's
welfare-to-work program. As we go into the new year, we may
have to make additional cuts. Until we better understand the
fiscal outlook, we should not be making changes of this kind."
AB 1058 (Beall), 2009-10 would have deleted the requirement that
county welfare departments assess the value of a vehicle when
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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 (Sharon Runner), 2007-08 would have amended the CalWORKs
eligibility vehicle asset limit by increasing the vehicle
resource limit from $4,650 to $7,000 and adjusting it annually
starting on January 1, 2010 to be the lesser of either 3% or the
change in the California Consumer Price Index. Also would have
added leased vehicles to the list of countable resources.
Failed passage in the Assembly Human Services Committee.
Analysis Prepared by : Eric Gelber / HUM. S. / (916) 319-2089
FN: 0003544