Panel Begins to Assess Impact of Welfare Changes

SACRAMENTO — While landmark federal legislation gives California broad new authority over welfare programs, state senators were cautioned Wednesday that Congress has attached potentially costly strings.

Under the federal bill, welfare recipients will be required to go to work within two years, and the state “must meet rapidly increasing” work participation rates, according to an analysis prepared for the Senate Health and Human Services Committee.

Failure to meet the work requirements in the first year of the program could result in a cut of 5% in the state’s $3.7-billion annual welfare block grant, according to Senate staff members reviewing the federal legislation.

On Wednesday, the health panel held the first state legislative hearing concerning the changes since President Clinton’s recent announcement that he will sign the sweeping legislation--which affects a broad array of safety-net programs for the needy--into law. Among other things, lawmakers focused on new federal requirements to get people off the welfare rolls and into jobs.

Under the legislation, 25% of all single parents on aid will be required to work approximately 20 hours a week in 1997. In 75% of two-parent families on aid, at least one parent will need to be working 35 hours a week next year.

Officials from Gov. Pete Wilson’s administration told the committee that they are continuing to study the federal changes and trying to figure out what to do once they become law.

But committee chairwoman Sen. Diane Watson (D-Los Angeles) said she was disappointed that Wilson’s representatives were unable to spell out timetables for implementing the federal legislation.

Watson said it is unlikely that all the state’s 58 counties will be able to meet the federal employment requirements, saying, “Many counties have a dearth of employment right now.”

In testimony and interviews, representatives of labor unions and county governments also questioned whether the state has the money to help train welfare recipients for jobs and whether there will be enough jobs for those on welfare.

“For many counties with high unemployment . . . there will not be enough jobs to move persons into the job market,” testified Tom Peters, director of the Marin County Department of Health and Human Services.

Frank Mecca, executive director of the County Welfare Directors Assn., said it will be costly to reach the federal participation levels and will require putting 60,000 more people to work next year.

Under California’s Greater Avenues for Independence (GAIN), the 11-year-old welfare-to-work training program, it costs about $2,000 a year to train each person, Mecca said in an interview.

“If we as a state are going to provide those kind of services” for more welfare recipients, Mecca said, it would cost an additional $100 million. Currently, he estimated, the GAIN program costs about $240 million a year.

In other testimony, Thomas Rankin, president of the California Labor Federation, AFL-CIO, told the committee that the federal work requirement will trigger increased competition for entry-level jobs and result in a “massive depression in wages.”

He suggested the state consider expanding eligibility for the state’s unemployment insurance program to provide a new safety net for the working poor who are thrown out of work because of the new competition for jobs.

In June, there were 434,000 people receiving unemployment insurance benefits, according to the state Employment Development Department. A spokeswoman for the department said the agency had no comment on Rankin’s proposal to expand eligibility for unemployment benefits.