GENERAL SUBJECT(S): DIVISION OF PUBLIC ASSISTANCE Overview of FY99 and FY00 Programs and Results The following overview was taken in log note format. Tapes and handouts will be on file with the House Finance Committee through the 21st Legislative Session, contact 465-2156. After the 21st Legislative Session they will be available through the Legislative Library at 465- 3808. Time Meeting Convened: 2:50 P.M. Tape(s): HFC 00 - 16, Side 1 HFC 00 - 16, Side 2 PRESENT: X Representative G. Davis X Co-Chair Therriault Absent Representative Foster X Co-Chair Mulder X Representative Grussendorf X Vice Chair Bunde Absent Representative Moses X Representative Austerman X Representative Phillips X Representative J. Davies X Representative Williams ALSO PRESENT: JIM NORDLUND, DIRECTOR, DIVISION OF PUBLIC ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES; JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES; JAY LIVEY, DEPUTY COMMISSIONER, DEPARTMENT OF HEALTH AND SOCIAL SERVICES; CHRIS ASHENBRENNER, PUBLIC ASSISTANCE MANAGER, DIVISION OF PUBLIC ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES. LOG SPEAKER DISCUSSION TAPE HFC 00 - 16 SIDE 1 000 CO-CHAIR MULDER Co-Chair Mulder convened the House Finance Committee meeting at 2:50 P.M. DIVISION OF PUBLIC ASSISTANCE OVERVIEW OF WELFARE REFORM 104 JIM NORDLUND, DIRECTOR, DIVISION OF PUBLIC ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES Mr. Nordlund provided handout material to Committee members. [Copies on File]. He noted that he would be speaking to Welfare Reform. He advised that he would be addressing the "Welfare Reform Status Report" contained in the handout. He noted that the program has basically been successful. 247 MR. NORDLUND Commented that Welfare Reform has achieved and changed the face of Public Assistance in the State of Alaska. Alaska has completed the second year of its new welfare program. AS a result of welfare reform, the dramatic decrease in welfare caseloads seen across the nation is happening in Alaska also. While caseload and spending are down and more recipients are working, challenges still persist in helping the remaining Alaskan families off welfare and into self- sufficiency. The strength of the economy in the State has made the program successful. He acknowledged that additionally, the program had been made good from investments made by the Legislature. This funding has helped clients become successful on the job. 353 MR. NORDLUND Spoke to the basics of the new law. Alaska's welfare reform law was signed by Governor Knowles in June of 1996, which changed welfare limits to time limited. Also, the client was expected to find work. He added that minor parents were required to live at home in order to qualify for the program. 470 MR. NORDLUND Reiterated that the new welfare reform laws have changed welfare by: ? Imposing a 5 year life time limit on benefits; and ? Requiring minor parents to live with their parents or in another safe home, and to finish high school. 559 CHRIS ASHENBRENNER, PUBLIC ASSISTANCE MANAGER, DIVISION OF PUBLIC ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES Commented on the exemptions to the program. * Such as extraordinary hardships. 592 VICE CHAIR BUNDE Noted that Senator Stevens was trying to expand that component. 614 MS. ASHENBRENNER Advised that there were two portions of the exemption which Senator Stevens had referenced. * Indians living on a reservation 668 VICE CHAIR BUNDE Questioned how they would maintain their benefits. 700 REPRESENTATIVE FOSTER Inquired how these people would they find work. 721 MR. NORDLUND Continued listing the welfare reform bullets in Alaska: ? Reducing benefits to two-parent families in the summer and to families with low housing costs; ? Requiring all recipients to develop a family self sufficiency plan; ? Allowing families more earned income so that it pays to work; ? Penalizing recipients for quitting or refusing to take a job; ? Enabling communities to play a greater role in the delivery of welfare-to- work services. 878 CO-CHAIR MULDER Asked the percentage of reduction in benefit resulting from the recipient going back to work. 901 MR. NORDLUND Explained that usually they would be receiving $200 dollars per month more from having the job. 944 MR. NORDLUND Pointed out that there are sanctions policies for those clients that refuse to take a job. Most of the work services in Alaska are provided by community based service providers under a grant or contract with Division of Public Assistance (DPA). 997 MR. NORDLUND Addressed the caseload growth by program year. [Copy on File]. He noted that the caseload was down 37% this month from the figure used in December 1996. He pointed out that it is important to remember the seasonal economy of the Alaskan people which would affect the caseload number each month differently. 1079 VICE CHAIR BUNDE Asked since most caseloads are down, shouldn't the caseworker numbers also be decreased. 1100 MR. NORDLUND Replied that the caseload numbers are down for only one program within the Department. He noted that there are six programs administered through the eligibility system and that the overall caseloads do not show such a significant decrease. 1150 MR. NORDLUND Advised that there is some staff that only addresses case management. The majority of the staff does other work. There are approximately 240 total caseworkers. 1185 CO-CHAIR MULDER Inquired how many people were being served. 1197 MS. ASHENBRENNER explained that eligibility was determined by a family system. Perhaps that family is no longer getting public assistance but they continue to receive some service through the Department. 1235 CO-CHAIR MULDER Asked how much federal versus state funds was used in the program. 1247 MR. NORDLUND Replied that each program was different. Food stamps are 100% federally funded. He noted that the Department receives a set block grant and the Department is required to match 80%. The AFDC program was funded on a 50% federal and 50% state basis with the total amount dependent on the size of the caseload. Under the new program, federal funding comes in a fixed amount known as the Temporary Assistance for needy Families (TANF) block grant and the State is required to match at least 80% of the federal level. The federal amount is always changing. The Medicaid programs are 50/50 split. 1312 CO-CHAIR MULDER Acknowledged the difficulty in separating the various accounts. 1328 REPRESENTATIVE PHILLIPS Noted that each family system is followed up. She asked how long that would go on for. 1352 MR. NORDLUND Replied that the limit was only established for the Welfare Reform portion of the program. 1373 MR. NORDLUND Acknowledged that the food stamp programs did have changes. Certain income levels are the only ones eligible for food stamps. 1400 MS. ASHENBRENNER Commented on the Medicaid/Medicare transition benefit. 1425 CO-CHAIR THERRIAULT Asked the number of clientele that each caseworker addresses. 1439 MS. ASHENBRENNER Replied that it could be 80 to 90 families and additionally that could cause tracking to twice as many programs. 1452 MR. NORDLUND Pointed out that there are new rules for each program, creating more time to make determinations. He emphasized that the work is more complex than it used to be. 1500 MR. NORDLUND Addressed the temporary assistance for needy families percent of the caseload growth by the program year. He commented on Alaska's position in the national average. This State's rate of decline was a little faster than the national average. 1587 REPRESENTATIVE G. DAVIS Believed that Alaska passed Welfare Reform one year before the federal government did. 1612 MR. NORDLUND Corrected that Alaska passed it only three months before President Clinton signed the federal mandate. 1640 MR. NORDLUND Referenced the handout that listed the actual amount of benefits paid over the last four years. [Copy on File]. 1670 MR. NORDLUND Due to declining caseloads and the reduced demand for cash benefit payments, millions of dollars have been made available to provide child care and work services for recipients and to supplant state funds for other services which has helped to reduce the State's budget deficit. 1703 MR. NORDLUND Pointed out that there has been a general fund reductions of $20 million dollars. 1723 MR. NORDLUND Currently, there is about a $30 million dollar general fund savings. 1742 CO-CHAIR THERRIAULT Asked if Congress was considering loosening the restrictions on what those funds could be used for. 1761 MR. NORDLUND Stated that to date, there has been discussion on that concern. However, there has been no movement yet. He stated that he looked forward to a healthy debate regarding the situation. 1795 CO-CHAIR MULDER Referenced the graph of matching funds. He asked what the current match was. 1832 MR. NORDLUND Replied that the State match was $50 million dollars. He noted that this year, the general fund match would need to be $50 million dollars. The federal rules allow the State to roll forward money. 1873 CO-CHAIR THERRIAULT Replied that some of that money had been shifted into Day Care Assistance. The State has been aggressive with those shifted funds. He added that there have been constraints in using those funds. 1904 MR. NORDLUND Agreed that there was a 30% ceiling and that the federal funds could be shifted. 1924 CO-CHAIR MULDER Asked if there were still excess funds. 1933 CO-CHAIR THERRIAULT Replied that there was some balance. 1941 MR. NORDLUND Continued, addressing the performance measures. [See handout]. These measures are continually changing. He pointed out that the performance measures were divided into 2 categories: ? Client reaches highest level of economic self-sufficiency; and ? Responsible stewardship. 2015 MR. NORDLUND Spoke to the expectation of the Division in regard to the long-term care for the individual and their family. The noted that the performance measures help to measure the thresholds and progress along the way. 2081 CO-CHAIR MULDER Encouraged the Department and the Division to work closely with the Chairs of both the Senate and House Subcommittees. 2102 CO-CHAIR THERRIAULT Asked about how healthcare option would affect the KidCare program. 2120 MR. NORDLUND Replied that for anyone with coverage under an employer would be ineligible for the KidCare program during the employed time period. 2141 CO-CHAIR THERRIAULT Asked what happens when and if the employer decides to drop the insurance. 2150 MR. NORDLUND Indicated that concern had been discussed at the KidCare meetings. He noted that Public Health is in charge of that evaluation. 2175 REPRESENTATIVE J. DAVIES Advised that the Commissioner had addressed that in her overview. 2186 REPRESENTATIVE J. DAVIES Added that it would be a concern if and when a trend is found to be happening. He added that there are always going to be "stories" floating around regarding that concern. 2210 MR. NORDLUND Addressed the Program Evaluation TAPE HFC 00 - 16 SIDE 2 000 MS. ASHENBRENNER Explained that the Division is attempting to identify the characteristics of those recipients coming back to the welfare system. She noted that the Division is now working with the University to help train recipients for better employment. 056 REPRESENTATIVE PHILLIPS Asked if only Alaskans are tracked. 071 MS. ASHENBRENNER Assumed that only the individuals that stay in the State would be tracked. 086 REPRESENTATIVE PHILLIPS Noted that she would hope that only Alaska residents were being tracked. 102 MS. ASHENBRENNER Commented that it is often difficult to recruit people to cooperate in a survey. 126 REPRESENTATIVE AUSTERMAN Asked for how long are the recipients being tracked. 145 MS. ASHENBRENNER Believed that it was for a 12-month period. She offered to provide that information to Committee members. 172 MR. NORDLUND Commented that one federal law provisions was that families attain a specific rate. He pointed out that there is an all- family rate line which the State of Alaska is doing well, however, in the two parent family rate, Alaska is not doing that well. As the caseloads decline, there has been a reduction in that percentage. 295 CO-CHAIR MULDER Questioned why Alaska was failing in the two-parent standard. 313 MR. NORDLUND Acknowledged that percentage was a high standard. He noted that a high percentage of those families live in rural Alaska where it is more difficult to be placed into the workforce. He added that there seems to be a higher level of dysfunction within that group. 379 REPRESENTATIVE PHILLIPS Commented that concept was contrary to history of mankind. She emphasized that 2 parent families are what hold families together. 410 MR. NORDLUND Countered that was only the history of the Public Assistance caseload in rural Alaska. 436 CO-CHAIR THERRIAULT Reiterated that it is rural Alaska being discussed. 456 REPRESENTATIVE PHILLIPS Repeated that information does not make sense. 474 MS. ASHENBRENNER Noted that 50% of these families live in rural Alaska. She added that these specific families are the more "dysfunctional" two parent families. They are not the functional working 2 parent families. These situations are dealing with substance abuse issues and little or no work skills. She noted that these people do continue to take care of their kids but that it is a challenge to work with them. She emphasized that these are time consuming issues. 583 MR. NORDLUND Noted that only 15% of the caseload is 2 parent families. He noted that the State does face penalties when not complying with these rates. 634 CO-CHAIR MULDER Questioned if there had been consideration given for the rural exemption. 647 MS. ASHENBRENNER Informed the members that a small consideration had been made for that situation. 669 MR. NORDLUND Spoke to work services philosophy. [See handout]. To meet the challenges presented by welfare reform, the Division provides funds through grants, contracts and reimbursable service agreements (RSA) to community organization, businesses and partner agencies best situated to provide welfare to work services. The majority of the funding provided to these organizations purchase case management and work search services. 788 MR. NORDLUND Expounded that many of these persons are not being placed into an ideal situation, which often makes it difficult to make a living wage. He reiterated that it is required that the worker be employable. 833 MR. NORDLUND The cornerstone of the program is the Work Search. This aspect moves the clients into the workforce as quickly as possible. The Work Search provider monitors the job search. They are coached, matched and placed into employment. In order to remain eligible, the client has to be looking for a job. The agency's model service consists of a four-week program, which intents to place 60% of those people in a job. He enumerated that there are situations in which the clients do have severe problems and may not make it through the work search portion. In these situations, they are referred to a treatment service. 933 CO-CHAIR MULDER Referenced the cost per month per client. 947 MR. NORDLUND Explained that the contracts are addressed on a "work search" basis. 986 CO-CHAIR MULDER Case management costs vary quite a bit. 997 MR. NORDLUND Added that the area cost differential also varies quite a bit. 1020 CO-CHAIR MULDER Pointed out that Nome was on the low end. 1041 MR. NORDLUND Offered to provide further explanation to Committee members regarding that concern. 1062 MR. NORDLUND Emphasized that the heart of the service is case management. The eligibility workers do the follow up. There are always variations on the case management. Some caseworkers are assigned to those that are employed and their employers. These contractors provide a slightly different service and sometimes intervene with the employer if there is a problem on the job. 1155 MR. NORDLUND Work Service & Child Care He noted that the Governor has requested additional childcare funds this year. He noted that a childcare assistance program could accompany that concept. Mr. Nordlund emphasized that as people move off temporary assistance, they need childcare. 1212 CO-CHAIR MULDER Asked why the childcare component ended up in the Department of Education. 1225 MR. NORDLUND Noted that through HB 40, there had been a debate as to which Department it should be placed. It was the Governor's desire that it be place in the Department of Education. It was intended that it be placed near Early Childhood Development. 1276 CO-CHAIR THERRIAULT Added that the debate centered on the quality aspect of the education of the child's first years. He noted that Head Start had been included in that consideration. He believed that it all should have been placed in the Department of Education including the Pass One component. 1338 MR. NORDLUND He pointed out that the State is over the + way mark of the 5-year plan. He noted that there has been concerns voiced as to what will happen to those people that are not capable of working. 1375 MS. ASHENBRENNER Addressed some of the challenges of those issues. She noted that the State is following the national average lines for services and assistance. There are however, issues of substance abuse, mental health concerns, and etc. There are some strategies being considered which try to address those concerns. She emphasized that learning disabilities have presented a major challenge for many of these people. 1451 REPRESENTATIVE PHILLIPS Questioned if the bottom 30% included the rural Alaskan recipients. 1470 MS. ASHENBRENNER Replied that number did include those persons. The Division is working with Alaska Works that is trying to train people for summer jobs. 1518 REPRESENTATIVE PHILLIPS Requested that the lower 30% number be broken down and highlighting specific concerns for Committee members. 1534 MR. NORDLUND Offered to provide that information. 1543 VICE CHAIR BUNDE Asked what would happen if a client refused to make contact with the work enforcement. 1561 MR. NORDLUND Replied that those people could be sanctioned. That action could result in a "hold" of 40% of their check. 1575 CO-CHAIR THERRIAULT Pointed out that people living in the rural communities still are required to participate in volunteer work and other sanctions programs. 1599 CO-CHAIR THERRIAULT Referenced the Governor's last request for Day Care assistance and the impact that would make on moving people through the system. 1622 MR. NORDLUND Stressed that if people can not get child care assistance, then they can not go to work. 1674 MS. ASHENBRENNER Reiterated that some recipients are currently complaining that they need more complete childcare assistance in order to continue working. 1710 MR. NORDLUND Added that the Department is undertaking other measures to help. Programs such as Love INC are dispatching welfare participant's rides to work. There is an off shoot of that program that is donating cars to recipients for transportation. He enumerated that there are a number of programs that are creating community participation. In Anchorage, there is the family Pathfinder's Organization, which exists through various churches. That program is a mentoring option. Mr. Nordlund stated that there are extras continually being provided by the community organizations to help these people move off welfare. 1831 MR. NORDLUND The Division is now doing more case management. 1844 CO-CHAIR THERRIAULT Questioned if most communities participating have some sort of faith based orientation. 1860 MR. NORDLUND Was only familiar with those in the larger cities. He noted that there are two groups specifically serving membership. 1883 CO-CHAIR THERRIAULT Noted that a flyer had been sent to his church to encourage the hiring of welfare recipients. 1915 CO-CHAIR MULDER ADJOURNMENT The meeting adjourned at 4:15 P.M. HOUSE FINANCE COMMITTEE LOG NOTES January 25, 2000 H.F.C. 11 1/25/00