BILL ANALYSIS �
SB 320
Page 1
Date of Hearing: August 8, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 320 (Wright) - As Amended: August 6, 2012
Policy Committee: Human
ServicesVote:4 - 2
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill specifies procedures pertaining to state
administrative hearings requested by applicants for, or
recipients of, public social services. Primarily, this bill
changes the process for conditional withdrawals, codifies the
current policies on establishing the burden of proof, and
clarifies and streamlines the scheduling and location of
hearings. Specifically, this bill:
1)Provides that claimants in fair hearings cases have a right to
an in-person hearing or may request a hearing by telephone, or
other electronic means, or at the claimant's home.
2)Provides that DSS shall decide on the format if the claimant
disagrees with a county's request for an in-person hearing,
and specifies notice requirements if DSS decides to change the
format of a hearing that had already been set.
3)Requires that the county representative offer the claimant a
conditional withdrawal agreeing that the county shall, as
applicable, issue the benefits or provide the services in
question, or cancel the overpayment or overissuance allegation
and refund any money already collected, if the county
representative determines that the county erred, the claimant
is eligible for a benefit or service, or a CalWORKs
overpayment or CalFresh benefit overissuance was invalid.
4)Requires counties to prepare and transmit to a claimant who is
scheduled for specified types of hearings, and his or her
representative, the position statement at least two working
days prior to the hearing.
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5)Requires the county to present its evidence first to establish
a prima facie case, and authorizes the ALJ to then determine
on the record whether or not the county met its burden of
proof. If the ALJ determines the burden was not met, requires
that the claim be granted without further hearing.
6)States that this legislation shall not be enacted until the
Superior Court of Alameda County has modified the court orders
in both King v. McMahon (1987, No. 398769) and Ball v. Swoap
(1987, No. H105716-0) regarding penalties payable to the
claimants, as agreed to by both parties, and that the
modification shall be sufficient to cover the costs to
implement the provisions of this bill.
FISCAL EFFECT
1)One-time costs of approximately $1 million GF for the
automation costs associated with the required changes.
2)Unknown, costs, likely several hundred thousand dollars per
year, on-going for workload associated with the increased
hearings due to allowing fair hearings to be conducted over
the phone or in a claimant's home.
3)Recent amendments allow funding for this legislation to come
from King/Ball penalties. In 2011-12 the state paid
approximately $1 million GF in penalties for late hearings.
That figure is expected to increase to approximately $2
million for 2012-13. Both DSS and the supporters of the bill
believe that the agreement will allow them to divert those
penalties for approximately three years, resulting in close to
$6 million GF, if needed, to implement this legislation.
However, modification of the penalties by the court does not
necessarily guarantee that foregone GF penalties will be
diverted for this purpose.
COMMENTS
1)Purpose . According to the author, the intent of this bill is
to streamline the hearing process and make it more efficient
without impeding the due process rights of claimants.
2)Conditional withdrawals . This bill specifies procedures for
resolving complaints without a hearing when a county
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determines that its determination with respect to services or
benefits was erroneous. In such instances, the county must
offer a conditional withdrawal rescinding the action and
specifying the conditions that must be met within 30 days.
If, upon receiving a notice of compliance with the conditions
from the county, the claimant is not satisfied that the
conditions have been met, the claimant may request a hearing
within 90 days.
This bill provides that, at the hearing, the ALJ has
discretion to determine if there is sufficient evidence in the
record to render a final decision resolving the dispute on the
merits and ordering the county to comply with the terms of the
final decision.
3)Right to an in-person hearing . All claimants currently have
the right to an in-person hearing; this bill allows and
specifies procedures for alternative forums for holding
hearings-telephonically or by other electronic means, or in
the person's own home if the claimant establishes that he or
she is unable to travel to a hearing site.
4)County's initial burden of proof . In addition, this bill
establishes the county's burden to prove its prima facie case
prior to presentation of the claimant's evidence, and the
ALJ's authority to grant the claimant's claim if, following
the county's presentation of evidence, it determines that the
county has not met its burden.
5)King/Ball Penalties . Federal mandates require that all
requests for hearing be adjudicated within 90 days of a
recipient's or applicant's request, or within 60 days for
CalFresh (Food Stamps) cases. Cases not adjudicated within
this period are deemed late cases and are subject to
court-ordered penalties, payable to the prevailing claimant.
Two court orders, King v. McMahon and Ball v. Swoap impose
financial penalties on DSS for failure to adjudicate hearing
decisions within the court mandated time frames on all
decisions. Under King v. McMahon, the court ordered this
requirement for CalWORKs (then Aid to Families and Dependent
Children) cases. Ball v. Swoap subsequently expanded the
decision in King to additional cases, including CalFresh
(formerly Food Stamps), MediCal and other non-CalWORKS cases.
Under the court orders, the minimum penalty is $50 with a
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daily penalty rate of $5 per day. However, if 95% of all
decisions are not issued within the required deadlines in a
given month, the daily penalty rate for that category
increases by $2.50 over the penalties being paid to claimants
the previous month. For example, assume the daily rate for
CalFresh for the month of May is $50 per day. If DSS did not
meet the 95% timeliness rate for the month of June, the
penalty paid to claimants receiving untimely decisions in the
month of June would increase by $2.50 and would go from $50 to
$52.50 per day. If DSS continued to fail to meet the 95%
timeliness rate in the month of July, the penalty would
increase by another $2.50 to $55 per day for claimants
receiving untimely decisions during July.
On the other hand, if 95% of all CalFresh decisions are
issued on time in a given month, the corresponding daily
penalty rate decreases by $2.50 from the penalty rate being
paid to claimants the previous month. For example, if the
daily penalty rate for the month of June is at $50, and DSS
met the 95% timeliness rate, the penalty for the month of July
would decrease to $47.50 per day. If DSS again met the 95% for
the month of July, the penalty would decrease from $47.50 to
$45.00 per day.
Current daily penalty rates are: CalWORKs, $57.50; CalFresh,
$50.00; Medi-Cal, $95.00; and other non-CalWORKs, $72.50. The
maximum daily rate that can be paid under the court orders is
$100 per day.
Analysis Prepared by : Julie Salley-Gray / APPR. / (916)
319-2081