July 11, 2012
The fallout from recent years’ state budget cuts is evident across California – from larger class sizes to rising university fees to diminished support for low-income seniors and people with disabilities. Recent cuts also have taken a toll on CalWORKs, which provides cash assistance to low-income families along with welfare-to-work services to help parents find jobs and overcome barriers to employment. Nearly four out of five CalWORKs participants (78.7 percent) are children.
Despite a jobless rate that remains in double digits, the number of families enrolled in CalWORKs has tumbled sharply, with the caseload dropping by more than 25,000 (4.2 percent) from June 2011 to March 2012, the most recent month for which data are available. Some portion of this decline could be due to the modest improvement in California’s economy: The state’s unemployment rate fell from 11.9 percent in June 2011 to 11.0 percent in March 2012. Some CalWORKs parents may have moved into the workforce – and out of the CalWORKs Program – during that period.
But the suddenness of the caseload drop-off indicates that some other factor was at work. The culprit? The major reductions adopted as part of last year’s budget. The Legislature cut CalWORKs grants by 8 percent, significantly reduced the earnings limit to qualify for CalWORKs, and rolled back adults’ lifetime limit from 60 months to 48 months. Not surprisingly, all three of these changes took effect in July 2011 – just as CalWORKs enrollment began its steep downward trajectory. In fact, recent state estimates suggest that these cuts caused more than 10,000 families to lose CalWORKs eligibility during 2011-12, and those estimates may understate the actual impact.
We at the CBP often say that budgets reflect values and priorities. A key corollary: Budget cuts have consequences.
– Scott Graves
February 29, 2012
In the aftermath of the Great Recession, California’s families face the toughest job market in decades. The state’s unemployment rate, currently 11.1 percent, is projected to remain in double digits through 2014. Nearly 1 million Californians have been without work for six months or longer – seven times higher than before the downturn began. Nearly one-quarter of California’s children (23.4 percent) were living in poverty in 2010, up from 17.9 percent in 2007. Moreover, the recession hit single mothers and their families particularly hard, as we show in this chart. The share of California’s single mothers with jobs dropped from a recent peak of 69.2 percent in 2007 to 58.8 percent in 2010. In just three years, the downturn erased all of the employment gains that single mothers made following implementation of welfare reform in the 1990s.
Given this grim landscape, CalWORKs – a key part of the state’s safety net for low-income families with children – is more important than ever for the 1.4 million Californians in the program, more than three out of four of whom are children. While state policymakers have made deep cuts to CalWORKs in recent years to help close budget gaps, the basic foundation – welfare-to-work services and modest cash assistance – remains intact. The Governor, however, proposes to blow apart that foundation with even deeper cuts, including reducing parents’ access to welfare-to-work services and dramatically cutting or eliminating cash assistance for more than 430,000 families – nearly three out of four families currently in the program. These changes would cut spending on CalWORKs by roughly $1 billion in 2012-13, providing more than 9 percent of the Governor’s proposed “solutions” to the state’s budget gap even though CalWORKs accounts for less than 3 percent of the state budget, as we show in a new report released this week.
The Governor’s proposal will receive a full airing in the Legislature this afternoon and tomorrow. Assembly Budget Subcommittee #1 on Health and Human Services will review the CalWORKs proposal today at 1:30 p.m., and the full Senate Budget and Fiscal Review Committee will hear the proposal tomorrow at 9:30 a.m.
– Scott Graves
January 9, 2012
Governor Brown released his Proposed 2012-13 Budget a full five days early after budget documents were inadvertently posted on a public website. The CBP will be delving into the budget in detail over the upcoming weeks and months, and will release our signature “chartbook” in early February. In the meantime, here are some first impressions:
- The Governor’s proposal highlights the importance of significant additional revenues that help close the budget gap. As we’ve blogged before, the various tax measures pending “title and summary” have differing impacts on the state’s bottom line. Absent additional revenues that help fill the budget gap, even deeper cuts are likely to occur in 2012-13 and future years. While the Governor’s revenue forecast shows a modestly smaller deficit – $9.2 billion over the next 18 months – than prior forecasts and somewhat stronger revenue collections, California still faces a significant “structural” gap between revenues and expenditures due to the lingering impact of the economic downturn and the massive corporate tax breaks approved by lawmakers in recent years.
- The proposed cuts to and redesign of the CalWORKs Program will put tens of thousands of children at serious risk of homelessness. When evaluating proposed CalWORKs policy changes, it is critical to remember that more than three-quarters of the Californians who receive cash assistance through the CalWORKs program are children. The Governor’s proposals come at a time when job prospects for single mothers – who make up most of the adults on CalWORKs – remain grim. The employment rate for California’s unmarried mothers dropped by 10.4 percentage points from a recent peak of 69.2 percent in 2007 to 58.8 percent in 2010. In fact, in just three years, the downturn erased all of the employment gains single mothers made following the enactment of welfare reform in the late 1990s. Fewer than six out of 10 unmarried mothers had jobs in 2010 – the smallest share since 1996. Women, nationally and here in California, are recovering from the recession more slowly than men, with the share of California’s working-age women with jobs declining 1.2 percentage points between November 2010 and November 2011.
- Overall, $2.5 billion of the proposed $4.2 billion in spending cuts target Health and Human Services programs and child care. These programs – which accounted for approximately one-third of 2011-12 General Fund spending – are slated to receive nearly 60 percent of the proposed cuts. The proposed policy changes would deny an estimated 62,000 children access to safe, affordable childcare; would limit services received by over 250,000 low-income seniors and individuals with severe disabilities in the In-Home Supportive Services Program; and limit cash assistance and welfare-to-work services for families at a time when jobs are scarce.
Budgets, as we frequently note, are about values and choices. We would urge lawmakers seeking to balance the budget to look first to eliminate programs that don’t work – such as the state’s failed enterprise zone program – before slashing those that do.
– Jean Ross
November 7, 2011
CalWORKs, the state’s welfare-to-work program, has been battered by budget cuts in recent years. Last Thursday, Assembly Budget Subcommittee No. 1 on Health and Human Services held an overview hearing to assess what those cuts mean for the 1.5 million Californians – including 1.1 million children – who rely on CalWORKs to help keep a roof over their heads, afford other necessities, and move toward self-sufficiency. The CBP provided testimony on the state’s discouraging jobs picture and recent trends in the CalWORKs Program. Our presentation described the impact of years of cuts to CalWORKs cash assistance and highlighted the fact that California now has a grant level lower than 27 other states, after adjusting for housing costs. Video of the hearing is here.
– Scott Graves
October 10, 2011
Governor Brown completed action this weekend on the roughly 600 bills that the Legislature sent him before adjourning last month. The Governor signed a significant budget-related bill, SB 202 (Hancock), which moves a state spending cap measure from the June 2012 primary election ballot to the November 2014 general election ballot. The spending cap measure – ACA 4 – was placed on the ballot as part of the October 2010 budget agreement. SB 202 also requires future initiatives and referenda to be placed on November general election ballots.
The Governor also signed AB 6 (Fuentes), which eliminates the fingerprinting requirement for CalFresh – formerly food stamp – applicants, although not for CalWORKs welfare-to-work applicants. AB 6 also cuts red tape by shifting from a quarterly to a six-month reporting system for CalFresh and CalWORKs recipients. These changes, which the CBP recommended back in 2009, are expected to increase program efficiencies and boost the CalFresh participation rate, which ranks near the bottom among the 50 states’ food assistance programs. Unfortunately, the Governor vetoed AB 1182 (Hernández), which would have further simplified CalWORKs by eliminating California’s restrictive “vehicle asset test.” Families who apply for CalWORKs generally cannot have a car worth more than $4,650, a limit that has not been adjusted since the mid-1990s. California has one of the strictest limits in the nation despite the fact that Californians rely heavily on their cars to get to work, and in today’s market a car worth less than $4,650 is not likely to be very reliable, to say the least. Let’s hope the Legislature gives the Governor an opportunity to reconsider his veto next year.
– Scott Graves