HB 78 CHILD SUPPORT & AFDC PROGRAMS  The House Health, Education and Social Services subcommittee on HB 78 was called to order by Co-Chair Con Bunde. Subcommittee members present at the call to order were Davis, Toohey, and Robinson. CO-CHAIR CON BUNDE said he viewed this meeting as a work session and the challenge for the subcommittee was to create a composite of the Governor's and Representative Mark Hanley's version of HB 78. He announced Glenda Straube, Director, Child Support Enforcement Division, Department of Revenue, via teleconference from Anchorage, was available for questions. Representative Hanley's Aide was also present for questions. However, no public testimony would be accepted today and thanked those who came anyway. Number 095 REPRESENTATIVE CAREN ROBINSON asked if other similar bills would be looked at today. Number 138 CO-CHAIR BUNDE stated the work session would only focus on the two bills before them. He said at some future time the subcommittee would look at other related bills. Number 162 CO-CHAIR CYNTHIA TOOHEY asked if there was any funding on the Governor's bill yet. Number 196 CURTIS LOMAS, Welfare Reform Program, Division of Public Assistance, Department of Health and Social Services, responded by referring the subcommittee members to a comparison chart in a packet of information prepared by Representative Hanley and his staff. Number 225 CO-CHAIR BUNDE commented that Representative Hanley should speak on the comparison chart himself. The challenge for the subcommittee was to look at the juncture of the two bills before them. He also announced the work session would be short due to a majority caucus meeting at 9:45 a.m. Number 262 REPRESENTATIVE MARK HANLEY started by presenting to the subcommittee a comparison spreadsheet of Senator Lyda Green's, the Governor's and his bill. The spreadsheet compared the different sections contained in each bill. He cited the "100-hour" rule, and the auto allowance were in all three bills but in different sections. He suggested the subcommittee compare and discuss the differences. The Governor included four basic work projects in his bill, whereas Representative Hanley included only one workfare section. He suggested the subcommittee hear from the department before proceeding. Number 438 C0-CHAIR BUNDE agreed with the comparison and contrast process presented by Representative Hanley. He further suggested the duplicated sections between the bills should be left alone. Number 486 REPRESENTATIVE HANLEY responded there were two duplicated sections. He further stated he was interested in asking the Governor why the "100-hour" rule did not apply to all sections. He also questioned the work program that allowed participants to keep only $50 of anything they made after the first three months. He alluded this was a disincentive to make more money. In his bill, he raised it to $200 and allowed the participants to keep one-third of everything made after that. He again suggested testimony from the department. Number 587 CO-CHAIR BUNDE invited Curtis Lomas and Jim Nordlund both from the Department of Health and Social Services to join them at the table. He also recognized Representative Tom Brices's attendance. He posed the question to the department guests why the "100-hour" rule was not waived in some sections. Number 641 JIM NORDLUND, Director, Division of Public Assistance, Department of Health and Social Services, said he was not sure about the thinking that went behind the various projects in the Governor's bill. Mr. Nordlund further said he was interested in Representative Hanley's approach of mixing and matching the similar areas in all three bills. Number 672 CO-CHAIR BUNDE reiterated this was a short meeting and he did not expect all questions to be answered immediately. He suggested Mr. Lomas address the above posed question regarding the "100-hour" rule. Number 706 CURTIS LOMAS, Welfare Reform Program, Division of Public Assistance, Department of Health and Social Services, responded to the "100-hour" rule question. He explained the Governor's bill contained two statewide projects - the unemployed parent and the self-employed programs; and two local projects - the work experience and the AFDC (Aid to Families with Dependent Children) diversion programs. The four projects would work concurrently but tracked separately. However, in the areas where community work projects were operating, the "100-hour" rule would apply on a select basis. Number 783 CO-CHAIR BUNDE questioned if it was because of fiscal restraints or to simply make a research project. MR. LOMAS responded it was to make a research project which matched federal guidelines. The federal government only allowed the policy waivers the Governor asked for in an experimental design. The approach of an on-site random selection and assignment was one of the requirements. Number 806 REPRESENTATIVE TOOHEY asked how the rules and regulations would be affected if the government went to a block grant approach. Number 827 MR. NORDLUND responded that Congress allowed extreme flexibility to the states, however, there were some mandates regarding benefits to teen parents, for example. He noted it was still being worked out. CO-CHAIR BUNDE said he wanted to run the subcommittee meeting informally so if anybody wanted to say something speak up and identify yourself. Number 864 REPRESENTATIVE HANLEY said the subcommittee should implement the things that it wanted to whether or not there was a waiver. If the restrictions were uplifted, we probably would not implement the "100-hour" rule. He suggested a monitored test project was needed. He said the maximum percentage under the waiver is 70/30, but if the restrictions were pulled, the department would implement within the restraints of the dollar amount. Number 953 CO-CHAIR BUNDE recognized Representative Hanley's comments and further stated we were aiming at a "moving target." He asked if Glenda Straube via teleconference in Anchorage had any comments. GLENDA STRAUBE, Director, Child Support Enforcement Division, Department of Revenue, said, no. Number 974 C0-CHAIR BUNDE suggested the subcommittee address the areas where the bills were different, such as, the workfare requirement sections. He asked Mr. Lomas if he was opposed to the workfare. Number 1010 REPRESENTATIVE HANLEY said he wanted to respond to that first. He stated he looked at the Governor's community work project section and he did not have a problem with it. He said it was similar to his workfare section. His bill, however, included those exempted from mandatory work. Whereas, the Governor's bill required the establishment of a community work pilot project and did not address numbers such as the 70/30 waiver. Number 1095 MR. LOMAS responded the Governor's community work provisions subsumed workfare and broadened the concept beyond the requirement to work without compensation for a specific number of hours. He further stated the Governor built in a range of activities that met the workfare requirements including paid employment and rural community activities. Also included was a provision for a private contractor to implement the program and take on some functions now performed by the Division of Public Assistance. The common contractor, he alluded, created a potential to evaluate current service level on a family-by-family basis. This in turn might highlight areas where service in kind was more appropriate than cash benefits. Number 1173 REPRESENTATIVE CYNTHIA TOOHEY asked if wood or fish was an example of a service in kind. MR. LOMAS answered yes and further expressed paying utility bills was another possibility. Rural leaders in particular were fond of a service in kind rather than a cash benefit because it represented a more traditional rural lifestyle. The cash was used inappropriately, he said, and rural leaders would like more control. He further stated, the Governor did not specify the exemptions in the statute to allow for criteria tailored to the community. Mr. Lomas asserted the idea was an alternative to the AFDC program. Number 1292 CO-CHAIR BUNDE said the Governor wanted to maintain maximum flexibility. He further asked what was meant of a private contractor. Number 1309 MR. LOMAS answered he would invite anyone to come forth and offer a competitive bid process giving preference to tribal entities. Number 1335 CO-CHAIR BUNDE asked if there was an envisioned right of appeal system for disagreements between the families and the system. He gave the example of a family believing they were entitled to cash benefits rather than credit at a cooperative store. Number 1353 MR. LOMAS answered there would be a considerable amount of regulations under which the programs would operate in specific areas. The Governor's bill built in a right of appeal. The appeal would be created to meet the special projects in the community. Number 1380 CO-CHAIR BUNDE said he had always been an advocate of electronic transfer so that cash was not used inappropriately. He cited this was a good example of a human transfer rather than an electronic transfer and thought it was an interesting concept. Number 1407 REPRESENTATIVE ROBINSON asked if Mr. Lomas knew of any reference to noncustodial parents and their participation in the workfare program. Number 1440 MR. LOMAS said he was aware of a few programs available to noncustodial parents. There was enthusiasm in his department to put together something that looked like JOBS participation and make it available to noncustodial parents. However, noncustodial parents were not clients of the Division of Public Assistance. Consequently, he said, the division could not attach sanctions. He further alluded if the Governor's budget were fully funded as, submitted, there would be enough slots available in the JOBS Program to be used in that manner. Number 1488 MS. STRAUBE said she was aware of one program called the Minnesota Parent Care Share that related to noncustodial parents. She felt it was a great idea because it would eliminate gender discrimination issues by promoting both parents to participate. Number 1537 REPRESENTATIVE TOM BRICE said leverage could be provided to noncustodial parents to make sure they participated through increased child support responsibilities, for instance. Number 1555 REPRESENTATIVE ROBINSON said neither bills addressed the issue of noncustodial parents or fathers paying child support. She suggested they incorporate these issues into the bill. Number 1585 MR. NORDLUND responded that child support was not addressed because of the constitutional single-subject rule. He suggested the subcommittee look at the entire package of related bills and move them concurrently. Number 1616 REPRESENTATIVE ROBINSON agreed with Mr. Nordlund and reiterated her suggestion the subcommittee look at other bills that make the package work. CO-CHAIR BUNDE responded that the subcommittee was bound by practicalities and time restraints. The subcommittee was aware of other bills but suggested they focus on composing the two bills before them. Number 1662 REPRESENTATIVE BRICE took exception to Mr. Nordlund's previous testimony. He suggested the subcommittee expand the title of the bill and design it so that it does not go against the constitutional single-subject standard. Number 1693 CO-CHAIR BUNDE reminded Ms. Straube in Anchorage to participate when she felt like it. Number 1700 REPRESENTATIVE TOOHEY suggested to the subcommittee to include the teen father more directly in the bill when discussing teen pregnancy. The bill so far tends to focus on the teen mother. Number 1757 REPRESENTATIVE ROBINSON agreed with Representative Toohey. She said there was a tendency to focus on the mother since she was the one carrying the child. Number 1763 CO-CHAIR BUNDE said there was a vehicle that passed last year where paternity was required to be established shortly after birth. He also said some mothers were resistant to provide a name. Number 1780 REPRESENTATIVE ROBINSON asked Ms. Straube if it was taking up to two years to establish paternity. MS. STRAUBE answered yes. REPRESENTATIVE ROBINSON responded we must keep in mind the process should be such that we do not punish the children. She cited an example of a young woman who was raped and ultimately took her own life because of the process she had to go through after the incident. Number 1803 REPRESENTATAIVE HANLEY said he did not have a problem with Representative Robinson's concerns. He directed the subcommittee to the spreadsheet explaining the assistance to minors with kids section included in Senator Green's and the Governor's bill. He suggested modifications were necessary. He announced he would talk to the department regarding the workfare section and the community work project to combine the two including fiscal guidelines. He further announced he liked the approach of using AFDC benefits in place of wages, especially in the rural communities, to help problems such as alcoholism. He alleged money was being used to buy alcohol rather than necessities such as food. Representative Hanley lastly asserted he wanted to focus on the workfare section and the earned income rule. The auto allowance and the "100-hour" rule applied to all sections in his bill and he would like to see those included. Number 1949 MR. LOMAS replied the auto allowance was part of the unemployed parent project. Number 1956 REPRESENTATIVE HANLEY concluded when writing his bill his approach was to eliminate disincentives, and to provide incentives and accountability where possible. Number 1988 CO-CHAIR BUNDE shared Representative Hanley's concerns. He concluded the challenge was to provide enough flexibility and guidelines to allow appropriate funding. Number 2012 REPRESENTATIVE ROBINSON suggested the subcommittee keep in mind the urban role and to try and expand the pilot programs state-wide. Number 2037 CO-CHAIR BUNDE agreed with Representative Robinson's comment regarding a wider application. He concluded by asking all members to continue to compare and contrast the two bills and called for another meeting in one week. Number 2058 MR. LOMAS before adjournment explained there were two amended fiscal notes as a result of a few oversights to HB 78. He asked the subcommittee to watch for them. Number 2080 CO-CHAIR BUNDE responded the subcommittee would not make decisions based on the current fiscal note in light of the new amended notes.