Inland Valley Daily Bulletin, May 18, 2008: Governor aims to reduce welfare rolls

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Robert Rogers, Staff Writer

Article Created: 05/18/2008 10:23:58 PM PDT

While the state’s budget woes seem sure as ever to result in significant cuts to education and health services, Gov. Arnold Schwarzenegger’s May revision of his proposed budget has another clear goal in mind – to reduce welfare rolls.

To that end, while facing $1.6 billion in budget cuts, the state Department of Social Services is in line with more than a dozen other states nationwide tweaking their welfare systems, emphasizing work incentives and, in some cases, increasing aid to poor working families.

“The governor knows these cuts affect real people, which is why they are so difficult to make,” said Lisa Page, a spokeswoman for Schwarzenegger’s office. “But the governor is doing it in a way that is maintaining vital services for the population in need.”

The proposed budget for the state welfare program is a mixed bag of cuts and boosts, with an overall budget reduction but a strategy that officials hope can help the state meet federal requirements while helping families through a tough economy.

“As a total package, the proposals restructure the programs to incentivize the right behavior,” said John Wagner, director of the Social Services Department. “The only way we can help families escape poverty is encouraging work.”

The centerpiece of the new-look welfare is the Work Incentive Nutritional Supplement, or WINS, which could add $40 per month in food-stamp benefits to 41,700 working families if passed in its current form in


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the governor’s proposed budget.

The assistance boost would apply to people whose incomes are low enough to qualify for food stamps but have already been weaned from the CalWorks program, which provides temporary financial assistance to needy families, Wagner said.

“The WINS program is meant in part to provide an added support to make sure people do not go back on welfare,” Wagner said.

Once fully implemented, the $40 state supplement to the federally financed food-stamp program would cost about $24 million annually.

The additional aid to some low-wage, working families is in line with more than a dozen states nationwide, with varying programs being considered or recently enacted. These actions reflect both an increasingly dismal economy and a welfare system far smaller than it was in 1996, when reform began to significantly trim the rolls.

In California, the move is also prompted by new federal guidelines that require states to make welfare payments to a recipient population that is at least 50 percent employed. Failure to meet that threshold could result in penalties and withholding of federal dollars.

Wagner said the state currently has a rate of 21 percent of recipients in “work activities,” a number he thinks can be driven up drastically if the governor’s package of proposals are approved.

Along with the carrot of more assistance for some working families, the stick could be strengthened as well. California currently cannot cease all assistance to families who fail to comply with work or other activity requirements, one of only a handful of states with such lenient policies, Wagner said.

The increases may help families grappling with climbing food and gas prices. But skeptics have noted that the benefits of WINS are relatively low – amounting to $480 annually – and that officials are more concerned with meeting the federal work requirements, in part by throwing nonworking recipients off the rolls.

In the governor’s proposal, families that do not comply with work or education requirements could see benefits slashed in half after six months and cut off completely after one year, Wagner said.

“As soon as they comply, we can put them back on the assistance,” Wagner said.

Opponents of the program, and the governor’s budget in general, contend that new welfare strategies and some extra food subsidies for working families are a small step forward after a giant leap back in spending in so many other areas that impact working families.

“This $40 proposal could be summed up as penny-wise and pound foolish,” Assemblywoman Wilmer Amina Carter, D-Rialto, said in a prepared statement. “This budget hurts working Californians more than it helps them.”

Wagner did concede that the welfare assistance would be cut, from an average of $723 per month per person to $687, but said the reduction would be largely offset by an increase in food-stamps funding.

Overall, Wagner insisted the proposal is a boon for both poor, working California families and the state’s taut budget.

“This is our plan to incentivize the right behavior, meet our federal requirements and recognize the state’s current fiscal crisis,” Wagner said.

Eric Nilsson, a Cal State San Bernardino labor economist, said successful government policy during economic downturns often features stimulus actions geared toward the poor and the working class.

Nilsson said sound policy and practical politics explain the growing number of states pumping extra dollars into the pockets of working families.

“When the economy is slowing, it makes sense to give the most to those who will spend the higher proportion of their income, and evidence has shown that lower-income people will spend,” Nilsson said. “And there’s a justice aspect too, namely that these people feel it first in economic downtimes, and they have the least to fall back on.”

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