Legislature(1993 - 1994)
02/28/1994 03:00 PM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 409 - AFDC DEMO PROJECT AND DECREASE CHAIR TOOHEY asked Rep. Mark Hanley to address his bill. Number 030 REP. G. DAVIS asked Rep. Hanley if he wanted to go through a comparison between the committee substitute (CS) and the original bill. Number 058 CHAIR TOOHEY stated for the record that Rep. Kott and Rep. Brice arrived at 3:11 p.m. She acknowledged that a quorum was now present. She also indicated that Rep. Bettye Davis was on teleconference in Anchorage. Number 077 REP. BUNDE made a motion to adopt the CS for HB 409. CHAIR TOOHEY, hearing no objections, stated that CSHB 409 was before the committee. Number 085 REP. MARK HANLEY, Prime Sponsor of HB 409, addressed the CS for HB 409. He stated the amendments made in the subcommittee addressed the concerns of the Department of Health and Social Services (DHSS). He said the changes made were in regards to time lines being set in place and ensuring that the those times were clear. He said if the DHSS could not find enough job slots available in the community service area, the department will not require the individuals to participate in the project. He also said the income disregard provisions will apply to everybody within the project, not just those who apply after the effective date. He said he could go through the specific line/page changes if the committee was so inclined. Number 177 CHAIR TOOHEY asked the pleasure of the committee. REP. G. DAVIS asked for Rep. Hanley to go through those line/page changes. Number 191 REP. HANLEY indicated that a sentence had been inserted on page 3, line 6, which read, "To the extent that the federal government approves the necessary waivers, the department shall implement the project." He said the new language addresses the concern of the DHSS, that if only one waiver was approved, perhaps it may not be worthwhile to implement the project. REP. HANLEY stated on page 3, line 10, the phrase, "when determining the amount of assistance to which an assistance unit in the project area is entitled," was added. He said it indicates that the disregards apply to "both the people that are currently on it, that will be in the test area, and the new people that come on it, that will be in the test group." REP. HANLEY indicated that on page 3, line 30, the word "if" was added to the beginning of the line. He also indicated that at the end of the sentence in line 30, the following sentence was added: "The department shall assess the availability of activities that satisfy the purposes of this subsection within each part of the project area and attempt to develop additional activities where necessary." He stated the provision would not require the participants to do community service if the DHSS has not made the slots available. Number 270 REP. BUNDE referred to the phrase "attempt to develop additional activities" and asked Rep. Hanley how broad the scope was regarding the attempt. REP. HANLEY said that would be left to the discretion of the DHSS. He felt the DHSS would follow regulations as far as developing a program for community service. REP. BUNDE stated for the record, "I was wanting to have your (Rep. Hanley) intent in the record. This could blossom into a huge WPA project or something." Rep. Bunde further stated that "it could be very expensive providing work for this volunteer opportunity. And, I don't think that was your intention or the department's intention." Number 315 REP. HANLEY said he did not envision the DHSS putting together a road crew to fill slots. He said he anticipated there to be currently operating activities in nonprofit organizations. Number 330 JAN HANSEN, Director, Division of Public Assistance, Department of Health and Social Services, answered questions in Juneau on HB 409. She stated that the DHSS has not factored into the fiscal notes anything that would indicate that the department would start something similar to a WPA project. She said the fiscal note includes creating community service slots similar to the process in the JOBS program. Also, there is a process called self-initiating where the participant looks for employment. She said it was intended that the volunteer community service activities not be well defined. REP. BUNDE said it was not his intent that they be spelled out in statute. He clarified that the project would be ancillary and not the start up of a new bureaucracy. CHAIR TOOHEY stated for the record that both Rep. Vezey and Rep. Nicholia had arrived at 3:09 p.m. REP. HANLEY stated that page 5, lines 17-18, indicates the dates for repealing the waivers and the ratable reductions. REP. HANLEY said page 5, line 18, was added to provide for the ratable reduction to be implemented January 1, 1995. He said there would be start-up costs incurred before the project even begins. REP. HANLEY said page 5, lines 21-25, were rewritten to clarify the times that the waivers take effect, if and when they are approved by the federal government. Number 447 CHAIR TOOHEY asked if there were any questions from the committee. There were none. She then announced that Seward, Fairbanks, and Anchorage were on teleconference. She indicated that Rep. Bettye Davis was on line in Anchorage. Number 476 REP. B. DAVIS, via teleconference from Anchorage, said she had no questions. Number 480 PUDGE KLEINKAUF, Concerned Citizen, testified via teleconference from Anchorage on CSHB 409. She stated that she was very concerned about the ratable reduction as it would decrease payments to Aid to Families with Dependent Children (AFDC) recipients, which were already cut last year. She felt there were other ways to approach the project. She said if the University of Alaska Anchorage was to do the demonstration project, and the Institute for Social and Economic Research was to head the project, the cost to the DHSS would be reduced significantly, resulting in a lesser ratable reduction to AFDC recipients. She said the demonstration project is broken down to 65% of the client group in the demonstration project and 35% in a control group. She asked if the control group and the demonstration group should be the same size and wondered if the results from the project would be valid. Number 544 JAN HANSEN answered that the federal government's office in health and human services that works with waivers prefers projects to have a 50% control group and 50% demonstration group. She indicated that when the DHSS had discussed with the federal office the size of the Alaskan populations in some areas, the federal offices said that a split of 65/35 is acceptable. MS. KLEINKAUF asked the committee to find other ways to fund the demonstration projects that would not affect the 25,000 children that receive AFDC. She referred to Rep. G. Davis' suggestion to use funds from child support enforcement to offset the ratable reduction to AFDC recipients and stated that it may be a viable option. She then asked why the demonstration could not be operated in conjunction with the JOBS program. She asked Ms. Hansen about the citation to the federal statutes and the code of federal regulations that would prohibit that option. She felt that it would be much more cost effective than setting up a whole new mechanism to operate the waivers. MS. HANSEN said to her understanding there is no statement that the JOBS program cannot operate in conjunction with the demonstration. She said some of the waivers are part of the JOBS program, and the state could design a waiver project that would operate within the JOBS program. She then stated that the JOBS program is operated by the state and that the Native JOBS programs is operated by Native grantees. She indicated that under those circumstances there would be some difficulty in "trying to run a waiver through." She did, however, feel that those options could be explored. Number 645 REP. BRICE asked Ms. Hansen to expound on why the state would want to "go through the administrative rigmarole" to make applications for waivers when the state can already accomplish the intent through the Family Support Act. MS. HANSEN said community service work experience is part of the JOBS program. It is a required component, particularly when the DHSS is serving two-parent unemployed families. She said community service work experience can be an additional component for those other than two-parent families, as long as it meets the employability development plan within the JOBS program. There is no prohibition to expanding community service within the JOBS program; however, the demonstration is a separate proposal in which there would be a requirement for those who work in the JOBS program to participate. REP. BRICE asked why the funds that come from the ratable reduction could not be invested into JOBS program, child support, and child care versus employing 23 bureaucrats. He felt there would be a greater return by investing in the lower numbers of people on AFDC. He asked if that would be a possibility. MS. HANSEN said she could only speak to what was in the bill. She stated, if Rep. Brice was asking if it was possible for the DHSS to expand community service work experience through the JOBS program, the answer was yes. She said that in terms of it being part of the project, she would have to defer to the sponsor. Number 723 REP. BRICE asked how successful demonstration projects have been in other states. He said it was his understanding the programs were not instrumental in building strong resumes and strong incomes for the participants. He said that perhaps the projects only kept idle minds from remaining idle. MS. HANSEN maintained that she has kept up with much of the literature and recently the Manpower Development Research Corporation has done evaluation studies of some community service projects. She said there is not a lot of experience at this point. She said there is sometimes the desire to require the recipient of AFDC to give something back to the community in return for receiving benefits. Also, there is the philosophy that community service is a way of getting a person into a workplace and getting hands-on experience. She said many of the community service work experiences have not been long term, they have been for small groups of people. Number 786 REP. BRICE asked Rep. Hanley if the goals of the workfare are to provide experience for the AFDC recipients or to fulfill a social contract by paying back the community. REP. HANLEY said it was a combination of both. He further stated that paid employment along with disregards gives the recipients the ability to improve their lifestyle. He said currently, "after four months, you get to keep $30.00 of anything you make. This bill will allow you to keep the first $200.00 plus a third of that afterwards." He then said that giving the disregards and having slots available provides experience and gets recipients closer to leaving the program. Number 838 REP. BRICE said, to his understanding, there has been no hard evidence that indicates recipients subsequently go into higher paying jobs as a result of participating in the project. He reiterated that he felt there are programs currently available that could benefit from funds generated by the ratable reduction. Number 871 CHAIR TOOHEY asked for testimony from Fairbanks. Number 875 ANNE SWIFT, Representative, Tanana Valley League of Women Voters, testified via teleconference on CSHB 409. She stated that she is opposed to cutting AFDC again. She said the League of Women Voters believe that if there is going to be some type of work related program, it should include job training as financial incentives. She said that a workfare program should do more than just get people out of the house to do a volunteer job. Number 904 REBECCA ROSSON, Member, Board of Directors, Alaskans with Disabilities Association (ADA), testified via teleconference from Fairbanks on CSHB 409. She stated that the bill makes no provision for people on disability. She said at the present time she is totally disabled, receives $409.00 from welfare a month, has exhausted all other avenues and can not receive additional help. Number 982 CHAIR TOOHEY interjected and offered Ms. Rosson the office telephone number of Jan Hansen, Director of the Division of Public Assistance. MS. ROSSON maintained that the bill does not take under consideration that there are disabled parents. She felt that it didn't make sense to take funds from those who have very little. CHAIR TOOHEY proceeded to give the office telephone number of Ms. Hansen to Ms. Rosson. Number 020 ROBIN WICKHAM, Member, ACCESS Alaska, testified via teleconference in opposition to CSHB 409. She stated that she is opposed to any additional cuts to AFDC or Adult Public Assistance. She also said that there are many gray areas in the bill. She said additional staff would have to be hired to supervise and monitor a project of such magnitude and consequently she felt there could be no savings. She said that it takes manpower and money to train people who are volunteers in community service work. She said that nonprofit employees are already overworked and underpaid and the responsibility of training volunteers from the community service work program is burdensome. She encouraged the committee to think about the individuals who would be affected by further cuts. Number 083 LOUISE CHARLES, Job Coordinator, Tanana Chiefs Conference, testified via teleconference from Fairbanks in opposition to CSHB 409. She stated she is opposed to any cuts to AFDC and Adult Public Assistance. She said it is very difficult to train people to become independently employed and self- supporting, even with comprehensive job services. She maintained that the JOBS program is still quite new and felt that money would be better spent by adequately funding it instead of starting a brand new project. She felt that rural villages were being overlooked as possibilities for participating in the project. Number 133 DAN LABROSSE, Staff Person, Deaf Community Services, testified via teleconference from Fairbanks in opposition to CSHB 409. He stated that the legislation is "reinventing the wheel." He felt there are excellent work programs provided by the state. He felt the existing programs should be more adequately funded and that new projects should not be started. TAPE 94-30, SIDE B Number 000 CHAIR TOOHEY asked for testimony from Seward. Number 005 KENNETH BLATCHFORD, Concerned Citizen, testified via teleconference from Seward in opposition to CSHB 409. He stated that he is opposed to any intent to reduce benefits to those who really need them. He felt the legislation would cause more bureaucracy and end up costing more. He also said the existing job programs should be funded instead of creating another new program. Number 080 CHAIR TOOHEY asked for testimony in Juneau. Number 085 PATRICK CUNNINGHAM, Member, Board of Directors, Alaska Chapter of the National Association of Social Workers, testified in Juneau on CSHB 409. He stated that he also had been a representative on the Welfare Reform Task Force for the legislature that was charged with implementing the Family Support Act of 1988. He said a result of the Family Support Act is the JOBS program. He felt if the JOBS program was fully implemented, it would substantially reduce welfare caseloads. MR. CUNNINGHAM said the waiver part of CSHB 409 is excellent in that it gives people extra money by tying them to a job. He asserted that a waiver process can be very expensive, citing that workfare has been part of some welfare reform throughout the United States for quite a while. He said the problem with workfare is that as a stand alone program it is a totally ineffective way of moving people off of public assistance. He maintained that most people "jump" at the opportunity for programs that promote education and training. He further stated that single parents can participate in that program and he felt that if it was not restricted to just single parents, there would be a lot more people participating in the program. He said that the waiver is positive, but the potential cost is under reported. MR. CUNNINGHAM maintained that other states have not funded demonstration projects with ratable reductions. He said a ratable reduction would affect the disabled and the elderly who would not participate in the project. He further stated that the concept of a workfare program would present various difficulties in the long run. He suggested fully implementing the JOBS programs, citing that the federal government mandates that all AFDC recipients must participate in the program. He said the problem is that only 20% of AFDC recipients are in that program because of inadequate funding. MR. CUNNINGHAM further suggested that the state should wait to see the Clinton Administration's plans for welfare reform, citing that a bill is promised as early as April. He asserted that if a group is locked into the project for five years, those participants may not have the opportunity to be involved in forthcoming welfare programs. He made a suggestion to resurrect or create a task force to address welfare reform that would customize the federal health care plan into a viable and comprehensive welfare reform plan. MR. CUNNINGHAM said a bill has been passed at the federal level for community service. The bill encourages people to participate in community service programs voluntarily so as to receive money or funds to go on to college. He said it was federal money that he felt AFDC recipients could take advantage of. He stated that the main thrust of CSHB 409 does nothing but reduce benefits to poor people, again. Number 400 CHAIR TOOHEY asked for questions. REP. G. DAVIS referred to the other states that have attempted workfare legislation and asked Mr. Cunningham if the projects requested waivers. MR. CUNNINGHAM said he was unsure, but a workfare program is really ineffective as a stand alone program. REP. G. DAVIS asked if there wasn't already enough training programs. MR. CUNNINGHAM said the programs are good, but the problem is low participation rates due to inadequate funding. Number 457 REP. NICHOLIA stated that the JOBS program is a very new program and not many people know about it. She said that people have to feel secure within a program and that they won't be thrown out into the streets without their benefits. CHAIR TOOHEY commented that it is a very valid program. Number 480 SHERRIE GOLL, Lobbyist, Alaska Women's Lobby and KIDPAC, testified in Juneau on CSHB 409. She stated that she was concerned about the ratable reductions and the inclusion of adult public assistance in those reductions. She said she could not find one other state that has paid for its welfare reform demonstration projects through waivers by taking funds away from the aged, blind, and disabled. She asserted that there are 10,000 people who cannot benefit in any way from the projects. She urged the committee to consider eliminating the adult public assistance cut entirely. She further urged the committee to perhaps find an entirely different way to fund the project. She felt that the JOBS program is more relative to the needs of those on AFDC and is very successful, but should be fully funded. She offered an anecdote of a mother she met on the bus who participates in Project Career and is being trained to become a supervisor in the area of bookkeeping. She said that the women attends the training courses and participates in community service work, both of which leave her very little time with her four children. Subsequently, Ms. Goll stated, most people do not want to be on public assistance. She also said there would be a displacement problem as a result of organizations hiring uncompensated workers. Number 713 CHAIR TOOHEY said the displacement of jobs had been addressed previously. REP. NICHOLIA said in her experience in working with public assistance recipients that there was never enough money in the JOBS program. She stated for the record that she had "worked with Martha Halverson of DCRA in Fairbanks, and every time we tried to get people that were on welfare into the vocational training center, we always ran into money problems with JTPA." CHAIR TOOHEY said it is an expensive program. She asked for further questions or testimony. Number 739 REP. BRICE said he missed the displacement discussion and asked if Rep. Hanley could address the issue. He also asked what alternatives the state has when the project is locked in for five years and in a year and a half "the feds say, go ahead and do it... after we've expended all this money on administration." REP. HANLEY suggested that even in the JOBS program the issue of job displacement exists. He said the legislation would not force anything on nonprofits. REP. BRICE maintained that the difference between the JOBS program participants and the workfare participants would be that the JOBS participant would be getting paid versus being free labor. He asked Ms. Hansen if that was correct. MS. HANSEN said the JOBS participants currently either do community service work or job sampling, are not paid, and receive their AFDC benefit. She addressed the issue of displacement. She felt it will be an unresolved issue until the nation decides to what degree community service should be done. She said the response she has received from nonprofits indicates that they have a lot of work that is not being done because they have more work to do than people to do it. Number 829 REP. BRICE asked Ms. Anderson to address the issue of the project being locked in for five years and the circumstances resulting from the federal government assuming the project(s) at their level. REP. HANLEY referred to a possible amendment that Rep. Brice had shared with him that would allow a state to stop the waiver programs if indeed the federal government undertakes various state projects. He acknowledged that the project could benefit from some flexibility in that area. REP. BRICE asked, if the federal government was to offer disregards that are proposed in the demonstration, would there be the potential that the state could not provide the rest of the state with those disregards because of the effect they would have on the demonstration project? MS. HANSEN said that in the course of negotiations with the federal government for a waiver, the terms and conditions can be negotiated. She said if the waiver becomes a part of federal law, the project could be halted or revised. Number 894 REP. HANLEY read from Colorado state law, which indicated that a mutually agreed upon strategy for dealing with the demonstration would be arrived at by both the state and federal government. The law further indicated that if a mutual strategy cannot be agreed upon, then each department reserves the right to withdraw any and all waivers. Rep. Hanley said that the statute indicates that flexibility can be incorporated into the waiver negotiations. CHAIR TOOHEY stated that her intention was to hold the bill in committee until appropriate changes have been made. REP. G. DAVIS agreed with the intent of the bill, but said the discussions within the meeting pertaining to workfare programs, the JOBS program, and perhaps the use of alternative funding has made him feel that the proposal warrants further discussions. CHAIR TOOHEY asked for comments from Rep. B. Davis. Number 947 REP. B. DAVIS asked Rep. Hanley what citation he was reading from. REP. HANLEY replied that the statutory excerpt that he read was from a waiver in Colorado pertaining to the terms and conditions that the state had with the federal government. REP. B. DAVIS asked if that waiver was approved. REP. HANLEY said yes. REP. B. DAVIS asked what the intention of the committee was regarding the bill that day. CHAIR TOOHEY said the committee would hold the bill over and then asked when Rep. B. Davis would return to Juneau. REP. B. DAVIS said she was unsure and indicated that her return time depends on the outcome of her medical appointment the following day. She further stated that her concerns had been voiced very well by others in the meeting. She felt another way should be found to fund the project. She said she noticed that a savings is indicated in the second year and asked why that is. She said she felt that the savings would perhaps indicate that the project is working, but she felt it shouldn't be a goal to put money back into the general fund. She also stated that most states that have similar projects do not use funds from sources like AFDC. She asked someone to speak to the aforementioned issues. Number 991 REP. BRICE reiterated the questions posed by Rep. B. Davis. MS. HANSEN asked Rep. B. Davis which year she was referring to regarding savings. TAPE 94-31, SIDE A Number 000 MS. HANSEN asked again which year Rep. B. Davis was referring to. REP. B. DAVIS said she was referring to the second year of the project. MS. HANSEN said the analysis created a ratable reduction, which in the most expensive year of the project matches the cost of the project based on the original project cost. REP. B. DAVIS asked if someone could work up different percentages for ratable reductions and suggested .7% instead of 1.7%. REP. BRICE suggested a change in the ratable to make it revenue neutral. REP. B. DAVIS agreed. CHAIR TOOHEY said there was no response to Rep. B. Davis' request. She said, "we could certainly come up with those numbers." She then asked if Rep. B. Davis had more comments or questions. REP. B. DAVIS said she could wait if the bill was going to be held. CHAIR TOOHEY said she would inform Rep. B. Davis of the date for the next subcommittee meeting. She asked for further comments. There were none. She then indicated that a subcommittee meeting would be set up to address the concerns brought up in the meeting. She then asked if that was the wish of the committee. There was no argument. Seeing no further business before the committee, CHAIR TOOHEY ADJOURNED the meeting at 4:25 p.m.