Legislature(1993 - 1994)

03/12/1993 03:50 PM Senate HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  Chairman  Rieger announced  that  SB  101  (ELIGIBILITY  FOR                 
  PUBLIC ASSISTANCE)  would  be  heard  next.   He  asked  JAN                 
  HANSEN, Director, Division  of Public Assistance, Department                 
  of Health & Social Services, to come before the committee to                 
  answer  questions relating  to  the  legislation.   Chairman                 
  Rieger asked Ms. Hansen to  explain page 2, Section 3.   Ms.                 
  Hansen said that  section concerns  the department  adopting                 
  regulations.    Currently,  the needs  standard  and payment                 
  standard are exactly the same.   The legislation establishes                 
  the needs  standard and  repay.   Ms. Hansen  said with  the                 
  legislation  the   department  is  proposing   to  create  a                 
  reduction in their  payment.  Currently, the  needs standard                 
  would be at  the level it  is and  the department would  pay                 
  less.  This  would allow the department  regulations so that                 
  they could increase the needs standard.  Ms. Hansen said the                 
  department is  looking at ways to create  work incentives so                 
  that people on welfare  who work would get  to keep some  of                 
  the money that  they earned.   The department  is trying  to                 
  look for a way to do that without it costing a lot of money.                 
  CHAIRMAN RIEGER said he received a  phone call from a person                 
  in a rural  village who described a problem where they had a                 
  baby sitter who had  to quit because the extra  income would                 
  put  them out of  the eligibility  standard for  their AFDC.                 
  Ms. Hansen said the bill addresses that problem slightly  in                 
  that if a person's income was within a few dollars of  being                 
  eligible   and  the   baby-sitting  would   make   a  person                 
  ineligible, they would be  able to still qualify.   The bill                 
  would allow a person who has a little higher income to still                 
  qualify for a small grant. She said at a given point  when a                 
  person  goes  to  work,  their   earned  income  makes  them                 
  ineligible.  Chairman  Rieger asked  if AFDC doesn't  tapper                 
  off with increased income.  Ms. Hansen said AFDC supplements                 
  what a person  has.  If a person has $500 in income, it will                 
  be supplemented up to the standard.                                          
  Ms. Hansen  explained that currently  in federal regulations                 
  if  people are  working they get  to keep some  of what they                 
  earn,   $30 and a third of the  remainder, but only for four                 
  months.  The  department wants to expand that incentive, but                 
  that isn't allowed under federal  law.  It can only be  done                 
  under a waiver.   Under a waiver you can only do it for half                 
  of your case load under an experimental project.  There have                 
  been indications  from the Clinton  Administration that some                 
  provisions  could  change  which might  allow  the  state to                 
  change that provision.                                                       
  Chairman  Rieger  asked what  increases  there are  in other                 
  programs.  He asked  what else is happening with  the Health                 
  and Social  Service budget.   Ms.  Hansen said other  things                 
  that are occurring  that are part of  the department's whole                 
  package have been  to the  Jobs Program which  is the  basic                 
  Welfare to Work  Program.  It  is being expanded by  federal                 
  mandate.  This year there has been an average of 930 clients                 
  each month.  Next year that will rise to 1,340 which  is the                 
  required number to  meet federal targets.   Ms. Hansen  said                 
  next  year the program has to  serve more unemployed parents                 
  rather  than  single  parent  families  because  of  another                 
  federal regulation change.  The department is required to do                 
  more work over and above the  job training, job search, work                 
  experience, and adult basic education.   The department will                 
  be expanding the work experience  component, will be serving                 
  more  people  and  unemployed  parents.    The  adult  basic                 
  education component is being expanded because people have to                 
  be brought up to  a 8.9 literacy level and then  to a G.E.D.                 
  Ms. Hansen said  the department  is slightly increasing  the                 
  amount   of  supportive  services   in  the   Jobs  Program.                 
  Supportive services is  funding which  goes for things  like                 
  work clothes,  car repair, or bus fare.  Ms. Hansen said the                 
  governor's budget is  proposing five  positions for what  is                 
  called "self  sufficiency in our  front line offices."   The                 
  first  time when a  client comes in to  apply for AFDC, they                 
  wouldn't just discuss whether the person is eligible.  A ten                 
  minute  component would be added to discuss what their goals                 
  and strategies are for getting off of welfare.  Other things                 
  that may  be discussed  are whether  the client  needs Adult                 
  Basic  Education, day care,  or substance  abuse help.   The                 
  Jobs  Program  only   serves  16  percent  of   the  welfare                 
  recipients.  Ms. Hansen said there are many clients who want                 
  to be  served under  the Jobs  Program and  are disappointed                 
  because they can't get into the program.                                     
  Number 287                                                                   
  SENATOR  ELLIS  asked when  the  rateable reduction  becomes                 
  effective.  Ms.  Hansen said it  would be effective July  1.                 
  Senator  Ellis  asked how  much  time people  would  have to                 
  adjust  to  the  new check  amount.    Ms.  Hansen said  the                 
  department's intention is  to notify  the clients after  the                 
  bill passes the legislature.  That  would give the clients a                 
  minimum  of six  weeks.   She  explained  that whenever  the                 
  department  does  a  mass  change,   a  computer  notice  is                 
  generated.    As  the  benefit   is  changed,  the  computer                 
  automatically tells the person what their grant was and what                 
  it will be.  There is text in the notice that  explains why.                 
  Senator Ellis asked how Section 8 housing works.  Ms. Hansen                 
  said the amount  the client  pays is a  percentage of  their                 
  income.  As their AFDC income goes down, their rent would be                 
  slightly adjusted downward.                                                  
  Senator  Ellis asked  how many  adults and  children are  on                 
  AFDC.  Ms. Hansen said there were 20,000 children and 12,000                 
  adults  in  1992.   The figure  is  probably higher  for the                 
  current year.   She said the total  cost of AFDC for  FY 93,                 
  including  the  department's   supplemental,  will  be  $120                 
  million.  On top of that, when the department calculates the                 
  proposed  caseload  increases  for  next  year at  about  11                 
  percent and the COLA  if it is not suspended,  the projected                 
  cost for FY 94 would be $137 million.  If the changes in the                 
  bill were implemented, it would bring  the FY 94 AFDC budget                 
  to $124 million.  Ms. Hansen referred to the APA Program and                 
  said there is adult public assistance  and then there is old                 
  age  assistance hold  harmless.   The  two  together is  the                 
  figure that creates the APA figure.  She said it will result                 
  in a slightly  higher figure paid  in FY 94  than in FY  93.                 
  Just  for  adult  public  assistance  without  the  old  age                 
  assistance hold harmless,  there would actually be  a slight                 
  reduction in dollars in FY  94.  In FY 93, it will  be $34.8                 
  million for adult  public assistance.   The proposed  budget                 
  with the COLA  and rateable  reductions for FY  94 is  $33.7                 
  million.  There was discussion regarding a chart the members                 
  had in their committee packets.                                              
  Number 413                                                                   
  Senator  Ellis asked Ms.  Hansen how much  federal money the                 
  state would be  turning away if the bill were to become law.                 
  He  asked her  to speak  to the  fiscal notes.   Ms.  Hansen                 
  explained  that in the  AFDC Program  the reduction,  if the                 
  bill were to  become law, would  be $12,651,000 total.   She                 
  said that would be 50 percent federal and 50 percent general                 
  fund.   Ms. Hansen said the savings to the APA Program would                 
  be $5,134,000 and would be all  general funds because of the                 
  different structures between  the APA  Program and the  AFDC                 
  Senator Ellis asked  Ms. Hansen to review  the fiscal notes.                 
  Ms. Hansen referred  to the first fiscal note and said it is                 
  for  the  AFDC  Program.   The  amount  of  savings that  is                 
  attributable  to the  rateable reduction  for FY 94  is $8.6                 
  million.   She noted  that there  are five  fiscal notes  as                 
  there are various components of the bill.  The second fiscal                 
  note is  suspending  the  APA  COLA and  the  dollar  amount                 
  related to the suspension is $607 thousand.  Ms. Hansen said                 
  the third fiscal note is to implement the rateable reduction                 
  in the APA Program  which would produce a savings  of $4.051                 
  million.   The forth  fiscal note is  the interim assistance                 
  reimbursement portion.  It  creates a cost shift of  what is                 
  currently  $434  thousand  general  funds  to  become   $434                 
  thousand of federal funds.  The  fiscal note shows zero, but                 
  there  is  $434  thousand general  fund  savings.   Chairman                 
  Rieger  indicated  there   is  a  misunderstanding  in   the                 
  numbering of the  fiscal notes.   Ms. Hansen said the  fifth                 
  fiscal  note  relates  to  the  restructuring of  the  needs                 
  standards  for  AFDC  unemployed  parents.   It  produces  a                 
  savings of $1.944  million.  She  said the last fiscal  note                 
  relates  to  the  funds that  are  directly  attributable to                 
  suspension of the COLA for AFDC which is $2.107 million.                     
  Number 531                                                                   
  SENATOR MILLER moved that SB 101  be passed out of committee                 
  with  individual  recommendations.     There  were   several                 
  SENATOR ELLIS said he has several amendments but they are in                 
  rough draft form.   He asked if  he could have more  time to                 
  prepare  amendments.    CHAIRMAN  RIEGER  said he  would  be                 
  willing  to  hold  the  bill  until  the  following  Monday.                 
  SENATOR MILLER moved and asked unanimous consent that  he be                 
  allowed to withdraw  his motion.  Hearing no  objection, the                 
  motion carried.                                                              
  Senator  Ellis referred to  the bill and  said it represents                 
  about seven  policy calls which have been  considered by the                 
  previous administrations.  He said he is concerned about all                 
  seven changes in a single year.  Senator Ellis said he would                 
  like to know what the underlying  policy reasons are for the                 
  Number 579                                                                   
  SENATOR SHARP asked what the COLA difference  was between FY                 
  92  and  FY 93.   Ms.  Hansen  said the  amount added  was 3                 
  percent over  the previous year  and was granted  January 1,                 
  TAPE 93-23, SIDE B                                                           
  Number 001                                                                   
  Ms.  Hansen indicated the 3  percent is a  COLA on the total                 
  amount paid, federal and state shares.                                       
  There was general discussion regarding budget  increases and                 
  decreases in state departments and programs.                                 

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