SB 51-PUBLIC ASSISTANCE PROGRAMS  CHAIR FRED DYSON announced SB 51 to be up for consideration. 2:56:51 PM KATHRYN FARNHAM, Department of Health and Social Services (DHSS) introduced SB 51. In 1996 the federal welfare reform program allowed states flexibility in the implementation of welfare reform with an emphasis on employment. That legislation has been successful in Alaska. The caseload reduction is 58 percent since 1994, saving the state $66 million dollars. The block grant program allows the states to create programs that emphasize work. This same flexibility was offered to Tribal organizations in the 1996 law, which allows them to run a tribal Temporary Assistance to Needy Families (TANF) program. Native organizations may apply for a federal block grant for the families in their region and serve them directly. To run a fair and equitable program that is on par with what the Native families could have received from the state, it is necessary to provide state funds. In 2000 the Alaska Legislature created and passed the Native TANF program providing the opportunity to help fund locally relevant programs. The law was made to sunset in June 2005. It was also designated to four of the 13 original entities. The four included the Tanana Chiefs Conference (TCC), the Association of Village Council Presidents (AVCP), Tlingit Haida Central Council (TLCC), and Metlakatla. 3:00:03 PM Reports show the tribal TANF programs are working. They are achieving migration to self-sufficiency though employment. This year they are in discussions with three new native organizations that are interested in running a tribal TANF program. The three are Cook Inlet Tribal Council, Bristol Bay Native Association and the Maniilaq Association. 3:02:22 PM The recommendation in SB 51 is to extend the program and make it permanent in the statute, and to extend it to the 12 regional non-profits plus Metlakatla. Many of the regional non-profits have been contractors to the State of Alaska providing case management services. If Cook Inlet establishes their TANF program there will be fiscal impacts. The attached fiscal note pertains to Cook Inlet. 3:04:59 PM SENATOR ELTON asked Ms. Farnham the kind of provisions there are for auditing a contractor who provides services such as case management. MS. FARNHAM advised current contracts are under an umbrella called "work services." Contracts have monitoring and performance tracks in them. In FY05 those contracts were pay for performance contracts. 3:06:39 PM SENATOR WILKEN asked Ms. Farnham what percent would Anchorage be in the budget if the committee re-authorized the programs. MS. FARNHAM replied they have not assessed the size of the Cook Inlet, Bristol Bay and Maniilaq caseloads. Cook Inlet will have close to 700 cases. SENATOR WILKEN asked the guarantee that federal funding will continue and what is the obligation of the state. MS. FARNHAM said the federal law authorizing Temporary Assistance for Needy Families is currently up for reauthorization. It has been reauthorized for several years without any substantial changes. If there are structural changes to the block grant, the program will have to be re-examined. 3:10:43 PM SENATOR WILKEN asked Ms. Farnham if the federal money was reduced in the future could he expect the general fund to make up the difference or could the legislation pare back the program. MS. FARNHAM was reluctant to speculate. CHAIR DYSON noted in this program the caseload has diminished but recipients may be receiving other assistance. MS. FARNHAM said she has seen cash assistance cases drop dramatically. Some cases are picking up bridge programs but she is also seeing families utilizing benefits that can help them stay off cash benefits, for example, child care assistance. 3:12:52 PM CHAIR DYSON asked Ms. Farnham whether the fiscal note reflected state money fluctuations in programs. MS. FARNHAM answered no, but the budget for the division of public assistance would show services trends. 3:14:04 PM CHAIR DYSON asked Ms. Farnham the number of people reflected in the caseload reduction who have gone to work. MS. FARNHAM answered there is a recent division study of why people leave TANF programs. Often they quit applying. A report is available on their website. Multiple issues affect a family. 3:16:07 PM CHAIR DYSON said the federal TANF program encourages states to invest in making families stay together. He asked Ms. Farnham how the funding is used to accomplish those federally emphasized goals through the funding stream. MS. FARNHAM answered the four purposes of TANF include promoting strong families and healthy marriages. Because of their high success rate, Alaska has received a high performance bonus for three straight years. 3:18:50 PM CHAIR DYSON asked Ms. Farnham to talk about tribal fraud. MS. FARNHAM replied part of the provisions for tribal organizations to have a TANF program is that they have fraud mechanisms in place. 3:20:42 PM MS. FARNHAM pointed out the food stamp error rate in Alaska was the worst in nation in 2003. Under Tony Lombardo's direction they turned it around and Alaska is now on par with other states. All the other programs have seen a marked improvement as well, by identifying trends and through training. CHAIR DYSON said national statistics show that 60 to 70 percent of all welfare applications have errors or fraud and 25 to 30 percent are fraudulent to some degree. He would like to know how many people are prosecuted and are making restitution. MS. FARNHAM said DHSS has a strong fraud unit. Of the number of cases that are suspected fraud and are reviewed, 30 percent pan out to be actual fraud. 3:23:10 PM SENATOR WILKEN asked Ms. Farnham for clarification on the fiscal note. MS. FARNHAM answered the details are on page four. The current funding level has been the same since 2001. Annually the budget includes 8.7 million dollars. Cook Inlet is in the fiscal note because it is new. The other three are already built into the budget. 3:25:48 PM SENATOR WILKEN asked about Maniilaq and Bristol Bay. MS. FARNHAM replied they were not factored because talks are ongoing. CHAIR DYSON announced he would hold SB 51 until the next committee meeting. There being no further business to come before the committee, Chair Dyson adjourned the meeting at 3:26:47 PM.