Locals leery of welfare reform bill
Despite the outcry from local government organizations about the potential effects of the welfare reform bill on local budgets, it is unlikely that those effects will be as severe and far-reaching as predicted. Still, problems will occur.
The bill does do away with the federal entitlements for Aid to Families with Dependent Children (AFDC) and the JOBS program, both of which will become part of a new block grant program. Supplemental Security Income (SSI), a cash program for the poor and disabled, and food stamps remain fully funded, but the benefits are to be cut back substantially. Indeed, states will get $55 million less over six years (FYs 1996 – 2001) than they would have gotten otherwise for those four programs, much of the decrease coming from cuts in food stamps and loss of SSI and AFDC benefits for legal immigrants who are not citizens.
The cities hardest hit by the bill, then, would be those with large populations of legal immigrants that state law mandates must be transferred to local public assistance rolls. Los Angeles estimates it will have to find $236 million a year to make up the difference.
New Haven, Conn., on the other hand, does not have nearly the number of legal immigrants that LA has, so Mayor John DeStefano expects the city to be able to handle the cuts.
Whether that will mean increases in local property taxes will not be known for a few years, he says. Still, not all the city’s legal immigrants will move to the public assistance rolls. “Some will move away,” DeStefano says. “Some will move in with families, and some will get jobs. But some won’t be able to do any of the three.”
But it is another provision in the bill that worries Randy Johnson, a county commissioner in Hennepin County, Minn., and president of the National Association of Counties.
Minnesota law allows Hennepin and four other counties to offer benefits better than those mandated by the federal government to some welfare recipients.
The counties have applied this “waiver” law to individuals under 22 who have never been married and have no high school diploma — the profile of the long-term welfare recipient.
Minnesota offers these individuals better child care and health benefits in hopes of cutting short the 15 years to 20 years they might normally spend on the welfare rolls.
The program, in the fourth of its five years, has been successful, Johnson says. But the terms of the waiver allow for only 15 percent of the five counties’ welfare population to enjoy the increased benefits.
“We are not sure whether the new legislation allows us to expand that 15 percent,” Johnson says. “Also, there is a question of whether we have to exclude those people when calculating the welfare-to-work timetables in the bill.”
The bill’s work requirements mandate states to have 25 percent of their welfare recipients working at least 20 hours a week by fiscal 1991.
That number increases to 50 percent working a 30-hour minimum in fiscal 2002. Failure to reach those goals results in a reduction in a state’s block grant.
It is important for Hennepin County and others with waivers to be able to include their waivered population in the statewide employment goals because employment outcomes for those individuals are better than those for the welfare population as a whole.
The reform bill, however, is unclear about that and other issues. According to Michael Kharfen, spokesman for the U.S. Department of Health and Human Services’ Administration for Children and Families, “This is a big bill with a lot of vagueness and inconsistency.”