BILL ANALYSIS �
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2013-2014 Regular Session
AB 1654 (Bonilla)
As Introduced
Hearing Date: June 17, 2014
Fiscal: Yes
Urgency: No
NR
SUBJECT
CalWORKs: assignment of child support
DESCRIPTION
Existing law requires families receiving assistance from the
California Work Opportunity and Responsibility to Kids
(CalWORKs) program to assign to the state any rights to child
support. That support, with the exception of $50 which "passes
through" to the recipient, is held by the state to reimburse the
state and federal governments for the CalWORKs assistance costs.
This bill would instead require that up to $100 is
"passed-through" to families with one child, and up to $200 for
families with two or more children, or a greater amount if
authorized by federal law. This bill would also provide
language expressing the intent of the Legislature with regard to
child support.
BACKGROUND
In 1975, Congress established the national child support program
as Part D of Title IV of the Social Security Act (IV-D Program)
to provide funds to states to establish paternity and child
support orders and collect and distribute child support
obligations. Under the Personal Responsibility and Work
Opportunity Reconciliation Act (PRWORA), a state's Temporary
Assistance for Needy Families (TANF) plan must contain an
assurance that the state will operate a child support
enforcement program pursuant to an approved IV-D plan. Basic
responsibility for administering the program is left to the
(more)
AB 1654 (Bonilla)
Page 2 of ?
state but the federal government plays a major role in dictating
the major design features, funding and evaluating state
programs. The federal government provides a 66 percent match
for any funds a state expends for reimbursable child support
enforcement activities. Collections made on behalf of families
receiving TANF assistance (and some other cash assistance
programs) are shared 50:50 with the federal government.
The Child Support Program was originally designed by Congress in
as a cost-recovery program to reimburse state and federal
governments for public assistance paid to children. However,
since the implementation of welfare reform in 1996, the program
has focused on family self-sufficiency and getting more child
support dollars directly to families.
On February 8, 2006, the President signed the Deficit Reduction
Act of 2005 (DRA). The DRA made substantial cuts in federal
funding for child support enforcement, mandated some additional
enforcement activities, and provided new state flexibility to
"pass-through" more child support dollars to children who
currently receive or formerly received TANF-funded assistance.
Effective October 1, 2008, the federal government waived its 50
percent share of any child support collected on behalf of any
TANF-funded family up to $100 per month for families with one
child and up to $200 for families with two or more children,
regardless of whether the child support is for current support
or arrearages. For current CalWORKs recipients, the first $50
of current support received from the noncustodial parent in the
month due is "passed through" to the CalWORKs family and
"disregarded" as income or resources in determining eligibility
and grant amount.
This bill would increase the current "pass-through" amount for
CalWORKs recipients from the first $50 of any child support
collected to the first $100 of any support payment collected for
one child and to the first $200 for two or more children. This
bill would also require that the "pass-through" child support be
"disregarded" as income and resources in determining eligibility
and amount of aid. This bill would also automatically increase
the "pass-through" amounts to mirror any subsequent increase in
federal law.
CHANGES TO EXISTING LAW
Existing federal law establishes the federal Temporary
AB 1654 (Bonilla)
Page 3 of ?
Assistance for Needy Families (TANF) program to provide aid to
eligible families. (42 U.S.C. Sec. 601 et seq.)
Existing law provides that, as a condition of eligibility for
cash assistance, an applicant or recipient must assign to the
state his or her rights to any child support owed at the time of
the application and/or during the receipt of benefits in an
amount not to exceed the total cash assistance provided to the
family. (Welf. & Inst. Code Sec. 11477.)
Existing law establishes the California Work Opportunity and
Responsibility to Kids program (CalWORKS) which administers TANF
funds to eligible families for welfare-to-work services. (Welf.
& Inst. Code Sec. 11200 et seq.)
Existing law requires each county to maintain a local child
support agency, which is responsible for promptly and
effectively establishing, modifying, and enforcing child support
obligations. (Fam. Code Sec. 17400.)
Existing law requires local child support agencies to pay
families receiving cash assistance the first $50 of any child
support collected in a month in which child support is due, and
that payment cannot be deducted from the amount of assistance to
which the family would otherwise be eligible. (Fam. Code Sec.
17504; Welf. & Inst. Code Sec. 11475.3.)
This bill would require that CalWORKS recipients receive the
first $100 of child support collected each month for families
with one child, and $200 of child support collected each month
for families with two or more children, unless federal law
specifies a greater amount, in which case the amount specified
in federal law shall be paid to recipients.
This bill would state the intent of the Legislature to increase
payments of child support obligations, improve the health and
well-being of low-income children in single-parent homes, and
strengthen the family unit by authorizing the maximum amount of
child support permitted under federal law, as specified.
COMMENT
1. Stated need for the bill
According to the author:
In California, more than two million children live in poverty.
AB 1654 (Bonilla)
Page 4 of ?
More than three-fourths of CalWORKs recipients are children.
The recession was particularly hard on single mothers. Single
moms have made a slower economic recovery than the general
population with only six in ten currently working. The
average CalWORKs monthly cash grant for a family of three is
$463. This equates to $15.43 per day, per family, or $5.14
per family member, to meet basic needs. An increased
pass-through and disregard compliments broader poverty
reduction work by helping families transition from welfare to
work.
Increasing pass-through and disregard amounts will improve
child support compliance. The rates of child support
collection for children receiving CalWORKs benefits are very
low. Studies show that some fathers do not pay child support
because of the understanding that the state retains all but
$50 of each support payment. AB 1654 will encourage
noncustodial fathers to pay child support.
2.This bill would increase the "pass-through" and "disregard"
for families receiving TANF-funded assistance
When families apply for CalWORKs they are required to assign to
the state their rights to any child support owed before and
during the assistance period and to cooperate with local child
support agencies in enforcement efforts. Under federal and
state law, states withhold any collected child support payments
for these families to reimburse the state and federal
governments for the assistance costs.
Prior to the PRWORA, states were required to "pass-through" and
"disregard" the first $50 of current child support payments to
the family as countable income for AFDC grant amount
calculations. This provision was repealed as a requirement of
PRWORA, but California retained in the CalWORKs program a
"pass-through" and "disregard" of the first $50 of any current
child support payment. Thus, for current CalWORKs recipients
the first $50 of current support received from the noncustodial
parent in the month due is "passed through" to the CalWORKs
family and "disregarded" as income or resources in determining
eligibility and grant amount. No "pass-through" payment is made
to the family for a month in which there is no support collected
or if the payment is not made timely.
Prior to 2008, a state was free to "pass-through" and
"disregard" any amount of child support collections. However,
AB 1654 (Bonilla)
Page 5 of ?
the state was still required to pay to the federal government
its 50 percent share of the collections. Effective October 1,
2008, the federal government waived its 50 percent share of any
child support collected on behalf of any TANF-funded family up
to $100 per month for families with one child and up to $200 for
families with two or more children, regardless of whether the
child support is for current support or arrearages.
Accordingly, this bill would increase the current "pass-through"
amount for CalWORKs recipients from the first $50 of any child
support collected to the first $100 of any support payment
collected for one child and to the first $200 for two or more
children.
The Center for Law and Social Policy (CLASP) and Policy Studies
Inc. suggest several advantages for implementing the
"pass-through" and "disregard" options in the Deficit Reduction
Act (DRA). They assert that the changes improve child support
compliance by encouraging fathers to work and pay child support.
They cite studies in Wisconsin that suggest when child support
is passed through and disregarded to families receiving TANF
cash assistance, more fathers pay support and pay more support.
Presumably, the supporting party is paying more because he/she
knows that the money is going to the child and not the
government. Additionally, they cite the same research for
demonstrating that an enhanced "pass-through" reduces fathers'
participation in the underground economy and provides an
incentive for them to pay through the formal child support
system. (Center for Law and Social Policy and Policy Studies,
Inc., More Child Support Dollars to Kids: Using New State
Flexibility in Child Support Pass-Through and Distribution Rules
to Benefit Government and Families (July 2006).)
CLASP also states that an increased "pass-through" and
"disregard" complements broader work and poverty reduction
strategies by assisting families in making the transition from
welfare to work and increasing the financial security for
families while they receive TANF benefits. Finally, they state
that the "pass-through" and "disregard" changes will improve
child support program performance and increase federal incentive
payments for states while simplifying the program.
3.Adjusting California amounts of child support "pass-through"
and "disregard" automatically
This bill would "pass-through" the first $100 to $200 dollars of
child support to a recipient of CalWORKs, as specified, unless
AB 1654 (Bonilla)
Page 6 of ?
the TANF program, or a similar federal law, specifies a greater
amount, in which case the amount specified in federal law shall
be paid to the recipient.
AB 176 (Jones, Ch. 488, Stats. 2007) would have increased the
"pass-through" amount to recipients, but those provisions were
amended out in the Senate. At that time, the economy was
suffering, and California was paying the federal government
fines for not yet having a single statewide child support
enforcement automation system. With the threat of further
fines, the state did not take advantage of the federal option to
pass a higher amount of child support dollars through CalWORKs
families, and instead kept the additional money that was part of
the state's share.
Since that time, California has fully implemented and received
federal certification for its statewide child support automation
system, and no longer faces the same threat of federal
penalties. However, there may be circumstances in California's
future where the state may not wish to raise the "pass-through"
amount to CalWORKs recipients, based solely on an adjustment in
federal law. The following amendment would remove the automatic
adjustment under this bill, thereby allowing the Legislature to
first review any future increases to CalWORKs recipients.
Author's amendments:
a. Page 2, line 17 strike "unless Section 657(a)(6) of
Title 42 of the United"
b. Page 2, strike lines 18-19
c. Page 3, line 1, strike "the recipient."
Support : American Federation of State, County, and Municipal
Employees (AFSCME); Brighter Beginnings; California Association
of Food Banks; California Catholic Conference of Bishops;
California Coalition of Women Prisoners; California Family
Resource Association; California Partnership; California State
Association of Counties; Children's Defense Fund-California;
Children's Network of Solano County; Coalition of California
Welfare Rights Organizations, Inc.; Contra Costa Child Care
Council; County Welfare Directors Association of California;
First 5 Association of California; Housing California; National
Association of Social Workers, California Chapter; San Diego
Hunger Coalition; San Francisco Living Wage Coalition; Solano
Family & Children's Services; Urban Counties Caucus; one
individual
AB 1654 (Bonilla)
Page 7 of ?
Opposition : None Known
HISTORY
Source : Western Center on Law and Poverty
Related Pending Legislation : None Known
Prior Legislation : AB 176 (Jones, Chapter 488, Statutes of 2007)
See Comment 3.
Prior Vote :
Assembly Floor (Ayes 76, Noes 0)
Assembly Appropriations Committee (Ayes 16, Noes 0)
Assembly Judiciary Committee (Ayes 9, Noes 0)
Assembly Human Services Committee (Ayes 7, Noes 0)
**************