Legislature(1995 - 1996)
03/10/1995 09:31 AM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SENATE HEALTH, EDUCATION AND SOCIAL SERVICES COMMITTEE March 10, 1995 9:31 a.m. MEMBERS PRESENT Senator Lyda Green, Chairman Senator Loren Leman, Vice-Chairman Senator Mike Miller MEMBERS ABSENT Senator Johnny Ellis Senator Judy Salo COMMITTEE CALENDAR SENATE BILL NO. 91 "An Act creating the crime of criminal transmission of human immunodeficiency virus (HIV)." Presentation by the Division of Public Assistance. SHES - 3/10/95 SB 98 (PERSONAL RESPONSIBILITY ACT OF 1995) was scheduled, but not heard this date. PREVIOUS SENATE COMMITTEE ACTION SB 91 - See Health, Education & Social Services minutes dated 3/8/95. SB 98 - See Health, Education & Social Services minutes dated 3/8/95. WITNESS REGISTER Jim Nordlund, Director Division of Public Assistance (DPA) Department of Health & Social Services (DHSS) P.O. Box 110640 Juneau, Alaska 99811-0640 POSITION STATEMENT: Reviewed the briefing document on Public Assistance Programs. Curt Lomas, Welfare Reform Program Division of Public Assistance, DHSS P.O. Box 110640 Juneau, Alaska 99811-0640 POSITION STATEMENT: Offered additional information about the Adult Public Assistance Program. Randy Moore, Administrative Officer Division of Public Assistance, DHSS P.O. Box 110640 Juneau, Alaska 99811-0640 POSITION STATEMENT: Discussed the Old Age Assistance Program. Jim Dalman, Program Officer Food Stamp Claims Unit Division of Public Assistance, DHSS 400 W. Willoughby, Suite 302 Juneau, Alaska 99801-1731 POSITION STATEMENT: Provided information about the Food Stamp Program, the Energy Assistance Program, and the Fraud Control Unit. Val Horner, JOBS Program Officer Division of Public Assistance, DHSS P.O. Box 110640 Juneau, Alaska 99811-0640 POSITION STATEMENT: Reviewed the Job Opportunities and Basic Skills Program. ACTION NARRATIVE TAPE 95-13, SIDE A SHES - 3/13/95 SB 91 CRIMINAL TRANSMISSION OF HIV Number 003 CHAIRMAN GREEN called the Senate Health, Education and Social Services (HESS) Committee to order at 9:31 a.m. and introduced SB 91 as the first order of business before the committee. SENATOR MILLER moved that the committee adopt the CS, Luckhaupt 3/9/95 version, in lieu of the original bill. CHAIRMAN GREEN noted that the CS made the change talked about in committee on Wednesday. SENATOR MILLER moved that the CS SB 91(HES) be moved out of committee with individual recommendations. Hearing no objection, it was so ordered. Number 026 CHAIRMAN GREEN informed everyone that the presentation by the Division of Public Assistance would be continued at this time. JIM NORDLUND, Director of the Division of Public Assistance, introduced the various DPA personnel present at the meeting. He began his presentation on page 14 of the briefing document which discussed the Adult Public Assistance (APA) program. APA is a supplement to the Federal Supplemental Security Income (SSI) program. SSI helps elderly, blind, and disabled adults. He specified that SSI payments are from the federal government and given directly to the client. APA then fills the remaining need to the point of the needs standard. CHAIRMAN GREEN inquired as to how the permanently disabled requirement would be a classification. CURT LOMAS, Welfare Reform Program for DPA, said that the process is complex. The definition of permanently disabled is established federally and based on the capacity to work. Such factors as medical conditions, psychological conditions, work history, age, and other determinants are reviewed in order to be classified as permanently disabled. The Department of Education within the Division of Vocational Rehabilitation make these disability determinations. Mr. Lomas commented that the specifics would vary in relation to the illness. The process to make the determination takes 60-90 days. Mr. Lomas pointed out that a number of the disability applicants do not initially qualify and more than half of those who appeal their determination are eventually found to be eligible. CHAIRMAN GREEN asked if the problem was the specification of permanent. CURT LOMAS explained that once disability is established due to a medical condition, the individual's prospect for employment would be the basis for the determination. The classification is tied to the individual's ability to earn a set amount. Mr. Lomas noted that there are periodic reviews once an individual is found to be disabled in order to review eligibility over time. Assistance would be terminated if the individual's capacity to earn increased over the minimum level. Number 126 JIM NORDLUND continued on page 14 by pointing out the chart in the middle of the page. He noted that the AFDC caseload has almost leveled out, but that has not been the case with APA. The most significant factor regarding the APA population would be the state population. Page 15 reviews the eligibility criteria for APA. The need and maximum payment standards are located on page 16. The state pays up to the amount of the needs standard. The amount of the payment has remained the same. The graphs on page 17 illustrated a regular rise in caseloads and expenditures from the fiscal years of 1990 to 1996 which seems to reflect the overall growth in the population. RANDY MOORE, Administrative Officer for DPA, directed the committee to page 14 which specified that 19.3 percent of those persons 65 and older received Old Age Assistance (OAA) in the fiscal year 1980 as compared to 14.2 percent in the fiscal year 1994. He believed that the growth of the APA population had exceeded the growth rate of Alaska's population. Number 213 JIM NORDLUND continued his briefing with page 18 which presents the graph information from page 17 in a different manner. Page 18 also points out the total savings resulting from the passage of HB 67. The current fiscal year, 1995, will save $3,192.2 million. Page 19 breaks down the APA cases according to the district area, race and category. He commented that this breakdown is similar to that of AFDC. CHAIRMAN GREEN inquired as to what interim assistance referred. JIM NORDLUND explained that interim assistance payments are in lieu of federal SSI payments. JIM NORDLUND moved on to the Food Stamp program on page 20. The Food Stamp program are funded 100 percent by the federal government. He pointed out that the graph of the overall budget of DPA on page 2 includes the Food Stamp program. The state and federal government share the administrative costs 50/50 which equals approximately $7 million for Alaska. He noted that the amount of food stamps an individual receives is based in part on their location; there is rural 1, rural 2, and an urban rate. This increases the complexity of the administration of the Food Stamp program. JIM DALMAN, Program Officer for the Food Stamp Claims Unit, noted that Alaska has specific language in the Food Stamp Act to cover the three food stamp rates. SENATOR LEMAN asked if there was a list which specified which communities receive which rating. JIM DALMAN said that he would forward that information to the senator. Number 277 JIM NORDLUND directed the committee to pages 21 and 22 which review the eligibility criteria for food stamps. JIM DALMAN explained that all food stamp applicants must meet the resource and income standards. The first test an applicant must pass would be a gross income test. If the applicant passes, then a set of deductions are applied. The next test would be the net income test which if they pass then the applicant's resources are reviewed. CHAIRMAN GREEN asked if waivers were available. JIM DALMAN stated that waivers would be available to some degree; there would be more flexibility than with the AFDC program. The Food Stamp program has more specific rules encompassed within the Food Stamp Act. He noted that waivers can be requested if things are not specified in the act. JIM NORDLUND directed the committee to page 23 which discusses the standards and maximum allotments for food stamps. Page 24 presents graphs which illustrate the case load and benefit growth from the fiscal years 1990 to 1996. CHAIRMAN GREEN asked if the administrative costs remain constant. JIM DALMAN said that administrative costs remain fairly constant, but those costs would reflect increased salaries, new components, and various other aspects affecting administrative costs. JIM NORDLUND asked if Alaska's share of the administrative costs was driven by a formula. JIM DALMAN replied that in part, that would be correct. Most of the federal programs are based on a time study, the amount of time workers spend on the various programs as well as other incidental costs. Mr. Dalman clarified that most of the workers perform multiple program eligibility. JIM NORDLUND continued the briefing with page 25 which contains graphs illustrating the food stamp cases by district area, race, and category. He began the portion of the packet regarding the Job Opportunities and Basic Skills (JOBS) program on page 26. The program was mandated by the federal government in the passage of the Family Support Act of 1988. The focus of the JOBS program is to encourage AFDC recipients into work related activities and employment. The program is proving to be effective in reducing caseload. He directed the committee to the graph at the bottom of page 28 which illustrates that the number of AFDC recipients finding work is increasing. He mentioned that the JOBS program would be facing a $500,000 cut in federal funding. This program is successful and an investment in the long-term. Number 376 VAL HORNER, JOBS Program Officer for DPA, explained that the program began as a career oriented program with long-term education and employment goals. She pointed out that the emphasis on long- term education had changed. The graph on page 27 regarding JOBS participants and the graph on page 28 regarding JOBS parents finding work both illuminate that change in philosophy. The JOBS program now focuses on helping clients become job ready as well as helping those who are job ready to become active and trained in the skills necessary for job searching. Through vocational counseling and the identification of a client's skill, realistic employment goals are produced which encourage entry level employment and gaining experience. Participation leading toward employment is required. Ms. Horner specified that the JOBS program relies on multiple agencies such as JTPA and the Department of Labor in order to operate the program. The program focuses on employment opportunities available in the client's community. She pointed out that currently the clients consisted of a significant amount of two-parent families rather than the single family of the past. She explained the process in which the JOBS program obtains its clients. The program serves six areas and targets the non-Native population; the Native population is served by a Native JOBS program which receives federal funding. In conclusion, Ms. Horner emphasized that the JOBS program focuses on moving clients towards employment by increasing educational levels, vocational training, and overcoming family issues which are barriers to employment. Number 436 CHAIRMAN GREEN inquired as to the process of receiving the various services from the different agencies; would the client be referred to different offices in different buildings. VAL HORNER said that going to different offices could happen, but that would depend upon the needs of the client. In Ketchikan, all the offices are located in the same building. CHAIRMAN GREEN asked if while a client was in the JOBS program would the client receive full benefits in order to maintain a basic lifestyle. VAL HORNER said that a client would receive an AFDC check while in the JOBS program. When a client begins paid employment the amount of the AFDC would be decreased in relation to the client's income. CHAIRMAN GREEN clarified that this would be a form of transition. VAL HORNER noted that the program provides supportive services such as child care, transportation assistance as well as paying for some professional licensing fees and work clothing. These services are only provided when a client works toward employment. CHAIRMAN GREEN inquired as to the percentage of federal support which would be withdrawn. JIM NORDLUND said that nationwide federal support would be reduced from $1.3 billion to $1 billion. VAL HORNER emphasized that the federal reduction is a scheduled reduction. SENATOR LEMAN asked if there was information regarding the cost of the program based on the number of jobs created. VAL HORNER said that there is such information. In Alaska, the development of a work site costs approximately $1,200. Child care costs, the most significant barrier to employment, increase the cost of the program. Ms. Horner stated that the program is worthwhile and does pay for itself. In response to Chairman Green, Ms. Horner agreed to forward the committee a list of the specific ways in which clients receive assistance. SENATOR LEMAN pointed out that a review of the cost per job could prove valuable in the delivery of the service. Another aspect of concern regarding the cost per job would be the length of time a client remains in the job market for the job that was created. He indicated that both of those aspects could illuminate the effectiveness of the program. Number 509 VAL HORNER noted that since the JOBS program is fairly new there is not enough history available to do accurate comparisons. She directed the committee to the chart discussing welfare savings on page 28. Employers' reports from the Department of Labor allows the JOBS program to accurately compare clients and their ongoing employment activities. She felt that the most important aspect of that comparison would be that the client had remained employed, whether or not the client remained in the same job was not as important. Ms. Horner emphasized that the effectiveness of the JOBS program goes further than dollar measurements. The program changes the lives of these people and their children, they are given dignity. SENATOR LEMAN stated that needy people can be helped and changed if they are given more dignity by taking care of their needs personally rather than through corporate government assistance programs. He agreed with the concept of the program, however, he was not as convinced of the effectiveness of the program. VAL HORNER acknowledged Senator Leman's concerns, but the significant growth in 1994 supported her belief in the program. She noted that she had researched employment and training programs and their effectiveness. States with programs that do not offer any education result in clients who may gain employment quickly, but they do not retain their employment. The Riverside project in California illustrates that long-term college education and short- term vocational training basically net the same results. She explained that for Alaska, short-term education with a focus on employment would be the most cost effective approach. The program is going in that direction. Ms. Horner noted that the JOBS program provides a work fair program which mandates that a two-parent family participate in community service. The program also requires that clients combine activities. Each individual participates up to 40 hours a week. She explained that once a client is in the program, the client would be required to take public service employment if that client has remained unemployed under the program for two to four days. If the client does not participate, the family loses their AFDC benefits. Number 575 CHAIRMAN GREEN asked if there was an effort to avoid duplication. VAL HORNER said yes, everyone works hard to avoid duplication. JIM NORDLUND recognized the debate between the effectiveness of long-term versus short-term training. He addressed Senator Leman's concern by pointing out that training a client toward a four year degree, the client would seem less likely to return to welfare because they would be moving into a better job. He felt that the emphasis in Alaska should be employing people. TAPE 95-13, SIDE B Number 590 CHAIRMAN GREEN asked if the clients of the JOBS program had been directed into the program or had they asked to participate in the program. VAL HORNER said that both scenarios occur. Ms. Horner agreed with Chairman Green that the JOBS program would not necessarily be voluntary. Ms. Horner also concurred with Chairman Green that the JOBS program can be a requirement which if not fulfilled would lead to the loss of benefits to the client. There are a lot of factors which would determine whether the client would have the JOBS program as an option or a requirement. Ms. Horner mentioned that one of the serious problems was the education level of the clients. Most clients are at a six grade level. Approximately 40 percent of the clients do not have a diploma or GED. Ms. Horner said that their goal was to educate these people up to at least the ninth grade level. Participation in the adult basic education program is required. She pointed out that through the testing for basic literacy - which everyone must take, even those who were high school graduates - they have found that the majority of clients have an education below the eighth grade level. SENATOR LEMAN reiterated Ms. Horner's statement that these low education levels also include individuals with high school diplomas. VAL HORNER specified that nearly 30 percent of the clients have a high school education and 40 percent do not have a high school education. Ms. Horner said that the problem with education should be attacked in the schools as well; by the time these individuals reach the JOBS program, it is almost too late. Number 554 SENATOR LEMAN said that it was obvious that there is not enough money being spent on education if 30 percent of the division's clients cannot read well. VAL HORNER supported school to work. CHAIRMAN GREEN requested more information regarding the statistics Ms. Horner mentioned about the educational status of their clients. VAL HORNER mentioned that the Department of Education and the Department of Labor are major partners in the JOBS program. CHAIRMAN GREEN inquired as to the percentage of AFDC clients that participate in the JOBS program. JIM NORDLUND said that it was approximately 30 percent. Page 27 could be used to compare the JOBS caseload versus the overall AFDC caseload which works out to be approximately 15 percent. CURT LOMAS pointed out that the Native JOBS programs serve numerous persons who are not reflected in these statistics. VAL HORNER noted that the Native JOBS programs are accountable to their federal agency. VAL HORNER commented on the growth the JOBS program has felt. There have been various intensive audits of the program within the last nine months. She pointed out that adding clients to the caseload does not guarantee employment because time is needed in order to work with the clients to achieve employment. There would be a point at which the staff would be maxed out and the effectiveness in dealing with their clients will decrease dramatically. She informed the committee that nationally, the effective caseload size is about 85 and 90. They are reaching the maximum capacity where effectiveness would be lost and placement would become a paper shuffle. JIM NORDLUND noted that the cap would be reached quickly with the $500,000 federal cut. This is why the division has a budget request for $500,000 in order to maintain the program at the current level. VAL HORNER reiterated that they were rapidly reaching the maximum capacity to effectively place people in employment with the current number of staff. CHAIRMAN GREEN asked if the staff was increased, could the number of clients be increased. VAL HORNER said yes. Number 485 JIM NORDLUND reviewed pages 27 and 28. He continued his briefing with the Energy Assistance Program (EAP) which begins on page 29. The EAP is 100 percent federally funded program which is utilized mainly in the winter months. Some staff are laid off in the summer months. JIM DALMAN explained that EAP gives a one time grant per year. EAP serves the working poor who may not be served under other programs. He informed the committee that last year 4,700 AFDC households were involved in EAP of the 14,000 clients that were served. There are tribal grantees that receive direct federal funding. He said that all of the payments made by EAP are mainly vendor payments. He pointed out that EAP has had a continuous decline in funding due to its block grant situation. EAP faces increased caseloads while benefits and federal funding decrease. CHAIRMAN GREEN asked if there was any cost to the state for this program. JIM DALMAN restated that EAP is 100 percent federally funded. SENATOR LEMAN asserted that those federal funds come from somewhere. JIM DALMAN agreed, but pointed out that these funds do not come from the general fund. JIM NORDLUND directed the committee to page 30 which discusses the General Relief Assistance (GRA) program. The needs standard for this program is very low; GRA serves as a last resort. Half of the budget for this program is applied to burials for indigent persons. CURT LOMAS pointed out that the remaining 50 percent of this program's budget is used for rental assistance for the homeless or those who are close to eviction. The maximum benefit for GRA is $120 per month per person. GRA is not a long-term program, a person much apply each month the assistance is needed. Number 414 JIM NORDLUND noted that the remainder of the packet addressed the Fraud Unit of DPA which is under the charge of Jim Dalman. JIM DALMAN pointed out that 40 percent of the Fraud Control Unit Staff had to be laid off last year which leaves the unit short- handed. He noted that there was an increment proposal in order to restore four investigator positions lost to federal funding cuts last year. He reviewed the three main functions of the Fraud Control Unit: investigations, administrative disqualification hearings, and claims processing and collection. He reported that the two investigator sub-unit of the early fraud detection investigations, located only in Anchorage, avoided costs in excess of $2 million. The cost avoidance for the fiscal year 1994 was $3.6 million. Fraud deterrence is important in the approach to accountability with these programs. Mr. Dalman informed the committee that the Fraud Unit was reorganized a few years ago which resulted in improvements in process, productivity and cost savings. Even with the federal cuts of last year, the unit streamlined and productivity was not effected. SENATOR LEMAN inquired as to the possibility of contracting some of that work. Number 347 JIM DALMAN recognized that some states have contracted such work with mixed success. The reorganization of the unit resulted in the reclassification of investigators down to a lower pay range, and recruited many experienced eligibility technicians and persons with investigative backgrounds. These people have been very productive with costs that are not extreme. He informed the committee that the budget increment to add four investigator positions would be approximately $240,000. Knowing this business from the inside out is a definite advantage. Mr. Dalman felt that the current operation was very efficient. The past reorganization and the advent of the disqualification hearings provides a more streamlined approach. Fewer cases are taken to prosecution which cuts a lot of the costs. He noted the broad support for the Fraud Unit. Contracting probably would not result in a much more cost efficient system. The current positions are making money. Currently, the unit is short-handed and faces a backlog which lead to the need for additional positions. He emphasized that fraud is happening, but that it is not an epidemic. JIM NORDLUND pointed out that the fraud investigators are recruited from the eligibility technicians which are trained from six months to a year. Contractors would not have this background. Mr. Nordlund was not convinced that contracting would result in a better productivity. JIM DALMAN reiterated that the past reorganization resulted in greater productivity at a decreased cost. SENATOR LEMAN referred to the recent spy case when he stated that he hoped that the fraud unit could achieve better and quicker results than the CIA did with that case. JIM DALMAN noted that each office does home visits which serve to recognize red flags such as certain lifestyles which would indicate fraud. Number 256 CHAIRMAN GREEN felt that an investigator's effectiveness must increase when they actually live in the community in which they serve. Currently all the investigators are in Anchorage. She suggested that even part-time investigators would be more effective if they lived in the community they served. JIM DALMAN explained that there are referrals from each office in the community. JIM NORDLUND stated that he had an administrative organization break down by region. The largest job classification of DPA would be the eligibility technicians who are located in the offices of the five regions. He reviewed the various offices and their responsibilities. There being no further business before the committee, the meeting adjourned at 10:50 a.m.