Bill Text: CA AB1058 | 2009-2010 | Regular Session | Amended

California Assembly Bill 1058 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: CalWORKs eligibility: asset limits: vehicles.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2009-08-27 - In committee: Held under submission. [AB1058 Detail]

Download: California-2009-AB1058-Amended.html

BILL NUMBER: AB 1058	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 23, 2009

INTRODUCED BY   Assembly Members Beall and Fuentes

                        FEBRUARY 27, 2009

   An act to repeal Sections 11155, 11155.1,  11155.2,
11155.6, 11257.5, and 11260   and 11155.2  of, and
to  repeal and add Section 11257 of   add
Section 11258 to  , the Welfare and Institutions Code, relating
to CalWORKs.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1058, as amended, Beall. CalWORKs eligibility: asset limits.
   Existing federal law provides for allocation of federal funds
through the federal Temporary Assistance for Needy Families (TANF)
block grant program to eligible states, with California's version of
this program being known as the California Work Opportunity and
Responsibility to Kids (CalWORKs) program.
   Existing law provides for the CalWORKs program, under which each
county provides cash assistance and other benefits to qualified
low-income families and individuals who meet specified eligibility
criteria.
   Existing law continually appropriates money from the General Fund
to pay for a share of aid grant costs under the CalWORKs program.
   Existing law imposes limits on the amount of income and personal
and real property an individual or family may possess in order to be
eligible for aid under the CalWORKs program.
   This bill would  limit a CalWORKs applicant's assets, as
defined, to $7,000 in order to be eligible for aid, but would
 remove asset limitations with respect to a recipient of
CalWORKs benefits, except as required by federal law  , and would
revise asset limitations applicable to CalWORKs applicants, to allow
an applicant to retain savings of $7,000, in addition to any
personal property and resources otherwise permitted by existing law
 . By increasing the duties of counties administering the
CalWORKs program, the bill would impose a state-mandated local
program.
   This bill would declare that no appropriation would be made for
purposes of the bill pursuant to the provision continuously
appropriating funds for the CalWORKs program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) In 1996, Congress passed the Personal Responsibility and Work
Opportunity Reconciliation Act (PRWORA), known as welfare reform,
which created the Temporary Assistance to Needy Families (TANF)
program. TANF gives states power to design their own programs,
including establishing asset limits. The California Work Opportunity
and Responsibility to Kids (CalWORKs) is California's program
implementing federal welfare reform provisions.
   (b) The structural components of the TANF program, as administered
by CalWORKs, have proven to be immensely effective in preserving
cash assistance for those in need. Federally mandated and
state-enforced time limits and work requirements effectively deter
anyone from applying for assistance without having exhausted all
other resources. These structural realities, coupled with the social
stigma associated with receiving public assistance, prevent anyone
with financial resources from considering public assistance.
   (c) In California, to qualify for public assistance under
CalWORKs, impoverished families must demonstrate that they are both
income- and asset-poor. Under current law, a low-income family will
not qualify for assistance if the family has savings or other assets,
excluding a home and specific vehicle allotment, exceeding the asset
limit of $2,000.
   (d) Asset limits were intended to ensure that public assistance
programs provide benefits only to those with too few resources to
support themselves. However, asset limits dissuade low-income
families from saving because, in doing so, they risk losing their
benefits. For families making the difficult transition from welfare
to work, developing assets is critical to achieving true economic
independence. In order to prevent a complete backslide to public
assistance, low-income working families must begin to develop their
own safety net through personal saving for use in the event of an
unexpected income shock due to illness or temporary unemployment. As
personal saving is essential to achieving self-sufficiency, which is
the stated goal of the CalWORKs program, saving should be encouraged
by welfare policy and social service agencies, rather than penalized.

   (e) To be economically secure, families need both income and
assets. Regular income helps families pay for their daily living
expenses. In contrast, families need assets to weather financial
hardships and get ahead. Assets provide a safety net for coping with
unanticipated expenses and emergencies, such as unemployment,
accidents, and illnesses, that could otherwise cause significant
financial hardship. Assets also help families build wealth and plan
for the future by, for example, saving for retirement or investing in
their children's education.
   (f) Several studies have documented the negative effect of asset
limits on wealth accumulation among low-income households in a
variety of public assistance programs. One study found that 49
percent of public assistance recipients indicated that they would
save more if the government did not cut their benefits because of
their savings.
   (g) Many states are actively trying to stimulate savings by TANF
recipients and other low-income people by addressing asset tests. The
States of Ohio and Virginia have eliminated the asset test
altogether. The State of Virginia decided to eliminate asset limits
for their TANF program, in December 2003, by administrative action,
with the goal of streamlining the eligibility process and cutting
down on administrative costs. This decision has saved the state an
estimated $400,000 annually, and to date, the State of Virginia has
reported no "horror stories" of individuals with significant assets
scamming the TANF program. In addition, in 1997, the State of Ohio
eliminated its asset limit and has not experienced any spike in the
rolls or reported fraud.
  SEC. 2.  Section 11155 of the Welfare and Institutions Code is
repealed.
  SEC. 3.  Section 11155.1 of the Welfare and Institutions Code is
repealed.
  SEC. 4.  Section 11155.2 of the Welfare and Institutions Code is
repealed. 
  SEC. 5.    Section 11155.6 of the Welfare and
Institutions Code is repealed.  
  SEC. 6.    Section 11257 of the Welfare and
Institutions Code, as amended by Section 1 of Chapter 569 of the
Statutes of 1984, is repealed.  
  SEC. 7.    Section 11257 of the Welfare and
Institutions Code, as amended by Section 28 of Chapter 1022 of the
Statutes of 2002, is repealed. 
   SEC. 8.   SEC. 5.   Section 
11257  11258  is added to the Welfare and
Institutions Code, to read:
    11257.   11258.   (a) Notwithstanding
any other provision of law, for any individual who is a recipient of
aid under this chapter, in order to encourage personal savings as a
bridge from government dependency to self-sufficiency, and to create
an incentive to saving, there shall be no limitation on the assets of
an individual or a family as a condition of eligibility for
receiving aid under this chapter, to the extent permitted under
federal law.
   (b) Notwithstanding subdivision (a), an applicant for benefits
under this chapter may retain  assets not to exceed a total
value   savings  of seven thousand dollars ($7,000)
 , in addition to any personal property and resources otherwise
permitted by this part  . This amount shall be adjusted annually
in accordance with changes in the California Necessities Index.

   (c) For the purposes of this section, the term "assets" includes
investments that appreciate over time, including, but not limited to,
investments that can be converted into cash, such as savings,
equities, 401(k) accounts, and individual retirement accounts. Assets
also include personal or real property that holds monetary value,
such as a house, an automobile, or a small business. 

  SEC. 9.    Section 11257.5 of the Welfare and
Institutions Code is repealed.  
  SEC. 10.    Section 11260 of the Welfare and
Institutions Code is repealed. 
   SEC. 11.   SEC. 6.   No appropriation
pursuant to Section 15200 of the Welfare and Institutions Code shall
be made for the purposes of this act.
   SEC. 12.   SEC. 7.   If the Commission
on State Mandates determines that this act contains costs mandated by
the state, reimbursement to local agencies and school districts for
those costs shall be made pursuant to Part 7 (commencing with Section
17500) of Division 4 of Title 2 of the Government Code.