BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
SB 43 (Liu)
Hearing Date: 5/26/2011 Amended: 4/25/2011
Consultant: Jolie Onodera Policy Vote: Human Services 7-0
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BILL SUMMARY: SB 43 would require those counties that elect to
provide a CalFresh Employment and Training (CalFresh E&T)
program to screen work registrants and defer (exempt) an
individual from mandatory placement if he or she meets federal
deferral criteria or resides in a federally determined work
surplus area. This bill would also require those counties that
elect to participate in the CalFresh E&T program, beginning
October 1, 2012, to offer self-initiated workfare to registrants
who are mandatorily placed in the program.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
Additional CalFresh benefits $10,700 annually per 25% of
E&T Federal
participants discontinued for failure
to meet work requirements
Additional CalFresh admin $1,100 annually ($385 GF)
perFederal/General/
25% of E&T participants discontinued
Local
for failure to meet work requirements
CalFresh E&T regulationCost pressure on county E&T grants
Federal
changes
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STAFF COMMENTS: SUSPENSE FILE.
This bill makes changes to the administration of the CalFresh
E&T program, including rules governing mandatory and voluntary
placements into the program, as well as exemptions from work
program requirements.
The United States Department of Agriculture (USDA) provides
annual funding for program administration of the Food Stamp
Employment and Training program (to be designated as the
CalFresh E&T program in California) to provide job training
services for non-assistance food stamp (NAFS) applicants and
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recipients. The CalFresh E&T program is administered by the
counties and overseen by the Department of Social Services
(DSS). There are currently 25 counties participating in the
CalFresh E&T program, with approximately 915,000 work
registrants reported and $94.5 million in total funding for
Federal Fiscal Year (FFY) 2010.
State regulations currently allow counties to defer specific
populations of work registrants from mandatory participation in
the CalFresh E&T program. Those who are deferred may voluntarily
participate and are not subject to CalFresh sanctions
(ineligibility for aid) for non-participation. For mandatory
placements, failure to participate without documented good cause
results in sanctions for one, three, and then six months.
This bill would require counties to screen work registrants for
CalFresh E&T program participation or deferral, and would
require an individual to be deferred from mandatory placement if
he or she satisfies federally mandated criteria or resides in a
federally determined work surplus area.
According to the U.S. Department of Labor, the qualifying rate
for a Labor Surplus Area (LSA) classification is 20 percent
above the national average unemployment rate. For FFY 2011, the
qualifying rate is 9.1 percent or above during the previous two
calendar years. California's unemployment rate has historically
exceeded national trends, and nearly all counties in California
currently qualify as a work surplus area. As a result, under the
provisions of this bill nearly all CalFresh E&T program
participants would be deferred from mandatory placement and
would not be subject to CalFresh sanctions due to
non-participation, resulting in significantly more recipients
retaining eligibility for CalFresh benefits.
Based on statewide data reported since 2008, the number of work
registrants who are discontinued from receiving CalFresh
benefits each month has been increasing, averaging 34,000
participants over the last six months of 2010, and 36,000 work
registrants in December 2010. The number of work registrants
attributable to CalFresh E&T counties is estimated to be
approximately 65 percent of total work registrants, or 23,400
participants statewide. It is unknown how many work registrants
are discontinued for failure to meet work requirements, as the
reasons for discontinuance are not reported statewide, and can
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include other causes such as failure to submit timely reports or
moving out of state.
It is estimated that every 25 percent of CalFresh E&T
participants discontinued monthly due to failure to meet work
requirements would impact approximately 5,850 individuals.
Deferring mandatory placement during periods of high
unemployment for these individuals could result in increased
annual CalFresh benefits of $10.7 million statewide (average
monthly CalFresh benefit of $153 per individual), with
associated administration costs of $1.1 million ($0.4 million
General Fund). The administrative costs would be offset to some
degree by cost savings for re-certification costs that would
have otherwise been incurred for sanctioned cases. Staff notes
that research also indicates that every $1 in CalFresh benefits
spent generates $1.73 in economic activity.
This bill requires counties that elect to participate in the
CalFresh E&T program to allow participants to meet work program
requirements through self-initiated workfare (in addition to any
other components the county offers). Self-initiated workfare is
a public service placement in a public or private nonprofit
agency that is initiated by the CalFresh recipient. Currently,
only Riverside County offers self-initiated workfare as a
CalFresh E&T program component. Effective October 1, 2012,
counties opting to participate in the CalFresh E&T program could
experience workload increases in order to develop a process for
tracking and verifying an individual's self-initiated work.
Workload increases
for DSS to work with counties and develop new claiming
procedures would be absorbable within existing resources.
A county that elects to participate in the CalFresh E&T program
would also be required to "demonstrate in its plan how it is
effectively using CalFresh E&T funds for each of the components
that the county offers", including but not limited to
self-initiated workfare, work experience or training, education,
job search, and the support services or client reimbursements
needed to participate in these components, as allowed by federal
law and guidance." This provision is vague, and suggests that
participating counties would have to report to DSS on their
activities in compliance with this section. To the extent that
this requires additional work and changes to county programming,
there could be cost pressure on CalFresh E&T funds to spend more
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on administration.
This bill states that counties shall have no duty to provide
workers' compensation coverage for a CalFresh E&T participant
who elects to participate in self-initiated workfare. DSS
currently covers workers' compensation coverage costs for the
CalFresh E&T program. To the extent increased workers'
compensation coverage is required, this would result in
increased DSS withholding of CalFresh E&T funds, and a
commensurate reduction in CalFresh E&T funds allocated to the
counties, placing further cost pressure on available CalFresh
E&T funds.
SB 1322 (Liu) 2010, which was substantially similar to this
bill, was vetoed by the Governor with the following message:
I am returning Senate Bill 1322 without my signature. While I
support the state's Food Stamp Employment and Training program
and the economic benefits that federal food stamps bring to
California, I am troubled that this bill reduces county
flexibility and instead requires that they offer self-initiated
workfare. Self-initiated workfare weakens the "work-first"
message of the program by allowing recipients to self-direct
their own volunteer work. While I wholeheartedly support
volunteer work in local communities, it does not build the
skills and work experience that is the primary objective of this
particular program.