BILL ANALYSIS                                                                                                                                                                                                    

                               Senator McGuire, Chair
                                2015 - 2016  Regular 

          Bill No:              SB 23
          |Author:   |Mitchell                                              |
          |Version:  |December 1, 2014       |Hearing    |March 24, 2015   |
          |          |                       |Date:      |                 |
          |Urgency:  |No                     |Fiscal:    |Yes              |
          |Consultant|Mareva Brown                                          |
          |:         |                                                      |
                          Subject:  CalWORKs:  eligibility

          This bill would repeal the state's Maximum Family Grant rule,  
          which prohibits aid to a child born into a family receiving  
          CalWORKs benefits if the child was conceived after the family  
          began receiving aid. It would prohibit the denial of aid for  
          that child, and would expressly prohibit the state from  
          requiring an applicant or recipient to disclose whether they  
          were a victim of incest or rape, their method of contraception  
          or whether a family used contraception, as specified. 

          Existing law:

          1)   Establishes the federal Temporary Assistance for Needy  
               Families (TANF) program, which permits states to implement  
               the program under a state plan. (42 USC  601 et seq.)

          2)   Establishes in state law the CalWORKs program to provide  
               cash assistance and other social services for low-income  
               families through the TANF program. Under CalWORKs, each  
               county provides assistance through a combination of state,  
               county and federal TANF funds. (WIC 10530)

          3)   Establishes guidelines for determining a family's maximum  


          SB 23 (Mitchell)                                          PageB  
               aid payment, including all eligible family members, as well  
               as the level of aid to be paid, as specified. (WIC 11450) 

          4)   Prohibits an increase in aid based on an increase in the  
               number of needy persons in a family due to the birth of an  
               additional child, if the family has received aid  
               continuously for the 10 months prior to the birth of the  
               child, as specified. (WIC 11450.04 (a))

          5)   Exempts this prohibition in the following circumstances: 

               a.        Any child who was conceived as a result of an act  
                    of rape, as defined in Sections 261 and 262 of the  
                    Penal Code, if the rape was reported to a law  
                    enforcement agency, medical or mental health  
                    professional or social services agency prior to, or  
                    within three months after, the birth of the child.

               b.        Any child who was conceived as a result of an  
                    incestuous relationship if the relationship was  
                    reported to a medical or mental health professional or  
                    a law enforcement agency or social services agency  
                    prior to, or within three months after, the birth of  
                    the child or if paternity has been established.

               c.        Any child who was conceived as a result of  
                    contraceptive failure if the parent was using an  
                    intrauterine device, a Norplant, or the sterilization  
                    of either parent.

               d.        If the family does not receive aid for two  
                    consecutive months during the 10-months prior to the  
                    child's birth. 

               e.        Children born on or before November 1, 1995.

               f.        Any child who would qualify for the maximum  
                    family grant cap if the family did not receive aid for  
                    24 consecutive months while the child was living with  
                    the family.

               g.        Any child conceived when either parent was a  
                    non-needy caretaker relative.


          SB 23 (Mitchell)                                          PageC  
               h.        Any child who is no longer living in the same  
                    home with either parent. (WIC 11450.04 (b) et seq.)

          6)   Requires 100 percent of any child support payment received  
               for a child who is born under the maximum family grant  
               (MFG) cap - and therefore is not the recipient of aid - to  
               be paid to the family. Additionally, prohibits any such  
               child support payment from being counted as income in  
               calculating CalWORKs benefits. (WIC 11450.04 (e))

          7)   Requires each county welfare department to notify  
               recipients of the MFG provisions in writing at the time of  
               application and recertification, as specified. (WIC  
               11450.04 (f))

          8)   Requires the state Department of Social Services (CDSS) to  
               seek appropriate federal waivers to implement the MFG limit  
               and associated conditions, as specified, and directs DSS to  
               implement the rule on the date the waiver is received by  
               declaration of the department's director. (WIC 11450.04  
          This bill:

             1)   Makes legislative findings and declarations that:

                  a.        Scientific research has demonstrated that  
                    young children living in deep poverty experience  
                    lifelong cognitive impairments limiting their ability  
                    to be prepared for and succeed in school.

                  b.        Academic research has documented an increase  
                    in missed days of school and in visits to hospital  
                    emergency rooms by children who live in deep poverty.

                  c.        The Maximum Family Grant (MFG) rule was  
                    adopted to limit the amount of time a family could  
                    receive assistance and to limit the amount of  
                    assistance received. The rule was passed before  
                    implementation of welfare reform. At the time the rule  
                    was adopted, there was no limit on the length of time  
                    a family could receive aid, no work requirements and  
                    the benefits provided were approximately 80 percent of  
                    the federal poverty level (FPL).


          SB 23 (Mitchell)                                          PageD  

                  d.        Since the rule's implementation, lifetime  
                    limits on aid and work requirements have been enacted  
                    in order to receive a maximum benefit of approximately  
                    40 percent of the FPL.

                  e.        The Maximum Family Grant rule makes poor  
                    children poorer, reducing the income of families with  
                    infants to less than 30 percent of the FPL.

                  f.        This legislation is necessary to protect  
                    infants born to families receiving CalWORKs from  
                    experiencing lifelong cognitive impairments due to the  
                    toxic stress of deep poverty and to ready those  
                    children for participation in California's public  
                    school system.

                  g.        This legislation is necessary to protect the  
                    reproductive and privacy rights of all applicants for,  
                    and recipients of, aid under the CalWORKs program.

             2)   Prohibits an applicant for, or recipient of, CalWORKs  
               aid from being required as a condition of eligibility to do  
               any of the following:

                  a.        Divulge that any member of the assistance unit  
                    is a victim of rape or incest.

                  b.        Share confidential medical records related to  
                    any member of the assistance unit's rape or incest.

                  c.        Use contraception, choose a particular method  
                    of contraception, or divulge the method of  
                    contraception that any member of the assistance unit  

             3)   Prohibits an applicant for or recipient of CalWORKs  
               benefits from being denied aid, or denied an increase in  
               the maximum aid payment, for a child born into the family  
               during a period in which the family is receiving aid.

             4)   Specifies that no increased benefit will be paid for any  
               month prior to January 1, 2016, as a result of repealing  
               the prior statute. 


          SB 23 (Mitchell)                                          PageE  

             5)   Repeals WIC 11450.04 which establishes and defines the  
               MFG rule, including exclusions for families in which a  
               mother reports she is a victim of rape or incest or in  
               instances where specified methods of contraception fail.

             6)   Prohibits appropriation pursuant to WIC 15200 be made  
               for the purposes of this act.

            FISCAL IMPACT
          This bill has not been analyzed by a fiscal committee, however a  
          Senate Appropriation Committee analysis of SB 899 in 2014, which  
          had identical language, estimated there would be major first  
          year increase in CalWORKs grant costs of about $205 million  
          (General Fund) based on data from county consortia indicating  
          13.33 percent of all children in CalWORKs households (131,400  
          children) were impacted by the MFG rule. The analysis noted that  
          future costs for existing cases could increase by five percent  
          per year ($10 million increase after the first year). It also  
          estimated potential future costs of $3.9 million to $7.8 million  
          (General Fund) for every 2,500 to 5,000 children born into  
          CalWORKs families each year who otherwise would have been  
          subject to the MFG rule, with annual costs cumulatively  
          increasing in subsequent years as well as other relatively minor  
          costs for automation and offsets for child support payment  
          increases and averted administrative hearings.

          Purpose of the bill:

          The author states that as a result of California's MFG policy,  
          women are forced to make decisions about the types of birth  
          control they can use if they are receiving public benefits.   
          Women who are raped are required to report that sensitive and  
          highly personal fact to their welfare caseworker in order for  
          their babies to receive aid. Some families chose to refuse  
          assistance (and become very poor) for the last three months of a  
          pregnancy rather than lose the grant for the new baby - which is  
          less than $200 a month - but will help pay for diapers and  
          wipes, according to the author. According to the author, in some  
          extreme cases, women will refuse a doctor's advice about when  
          she should deliver her baby in order to stay off aid for a full  


          SB 23 (Mitchell)                                          PageF  
          two months during her pregnancy, which would allow her to avoid  
          the grant cap.  The author states that this kind of desperation  
          is unconscionable to force upon poor women - especially  
          considering the fact that the maximum grant is just enough to  
          put a family at about 40 percent of the federal poverty line.
          Poverty and CalWORKs 
           California has the highest poverty rate in the nation - just  
          under one-quarter of residents are living at or below the  
          federal poverty level (FPL), meaning they earn no more than  
          $20,090 per year for a family of three. During and after the  
          Great Recession, California saw growing rates of deep childhood  
          poverty - those living below 50 percent of the federal poverty  

          One of California's most essential anti-poverty strategies is  
          the California Work Opportunity and Responsibility to Kids  
          program (CalWORKs), which provides cash assistance to  
          approximately 540,000 families - including more than 1 million  
          children, according to 2014 federal data. Federal funding for  
          CalWORKs comes from the TANF block grant. 

          Currently, a grant to a family of three in a high-cost  
          California county is $670 per month but that will increase to  
          $704 per month in April 2015. The current grant level is 40  
          percent of the federal poverty threshold (FPL), compared with 81  
          percent of FPL in 1989 and 55 percent in 1997. In the past five  
          years, California's CalWORKs benefit has undergone significant  
          grant cuts, the elimination of a Cost of Living Adjustment, and  
          a radical restructuring of the Welfare to Work activities,  
          requirements and time limits. Adults in the program have gone  
          from a 60-month lifetime limit on CalWORKs aid to a 48-month  
          limit, with strict requirements on work participation to remain  
          in the program after 24 months. 

          Maximum Family Grant rule
           In 1992, against the backdrop of a debate about whether  
          "intergenerational welfare" was encouraging women to avoid work  
          and have additional children, New Jersey passed the nation's  
          first statewide family cap policy. The policy prohibited  
          additional benefits from being provided to a family for children  
          born after the family began receiving welfare benefits. The  


          SB 23 (Mitchell)                                          PageG  
          policy, which was soon copied by other states, came amid a  
          national conversation that would become the basis for the  
          Personal Responsibility and Work Opportunity Reconciliation Act  
          of 1996 (PRWORA), which established a 60-month time-limit on  
          benefits in most cases, and emphasized integrating parents into  
          the workforce as part of the program. 

          Prior to the passage of PRWORA, states needed waivers to  
          implement family cap policies, which required rigorous  
          evaluations of whether the policies achieved their intended  
          goals. AB 473 (Brulte, Chapter 196, Statutes of 1994) created  
          California's maximum family grant (MFG) rule as part of budget  
          trailer bill, and required California to obtain a federal waiver  
          to be able to implement the new MFG rule, as the rule was  
          inconsistent with existing federal regulations. California's  
          waiver application was approved in August of 1996, however  
          waiver approval coincided with the passage of PRWORA, which  
          granted states flexibility to implement their own policies  
          without need for a waiver, and California proceeded with the MFG  
          policy without implementing the waiver. California's MFG policy  
          has not been amended since its original enactment.

          The MFG legislation was based on the belief that increasing  
          welfare grants for children born into AFDC families may  
          incentivize families to have additional children for the  
          explicit purpose of increasing their monthly grant. By limiting  
          the grant amount, policymakers argued that families would be  
          dissuaded from having additional children.  In a heated floor  
          debate in July 1994, in which the bill's author argued that the  
          MFG would "encourage the transition to self-sufficiency,"  
          then-Assemblyman John Burton questioned whether this move would  
          achieve the intended goal. "Welfare reform is getting people off  
          of welfare and into a productive role in society with a job, not  
          starving some kid who happens to be born into a family that is  
          on AFDC," Burton argued.

          Today, CDSS estimates about 134,900 children per month are  
          subject to the MFG rule. According to a 2013 CDSS sampling of  
          cases, approximately 58 percent of MFG children are under age 6.  
          For a family with an MFG child, the loss in grant in 2015 is  
          between $116 and $136 per month, according to CDSS data.


          SB 23 (Mitchell)                                          PageH  

          How the MFG rule works

          California's MFG rule prohibits CalWORKs aid payments, with  
          certain exceptions, for a child that is born into a family that  
          has been receiving aid for 10 or more continuous months, or for  
          longer than the gestational period of the new baby. 

          If the family is not receiving aid for two or more months during  
          the 10-month period preceding the birth of the child, the new  
          child becomes eligible for aid in the CalWORKs benefit  
          calculation. Additionally, the MFG rule does not apply if a  
          family returns to aid after a break of two or more years during  
          which the family did not receive any aid, provided that the  
          family still meets eligibility requirements and aided children  
          are still under 18 years old.

          Exceptions to the MFG rule

          California's statute permits exceptions to the MFG rule for  
          incidents in which a child was born as a result of rape or  
          incest, as long as the mother of the child can document that she  
          reported the crime to law enforcement or a mental health  
          professional or social services agency. The report must have  
          been made prior to the child's birth or within three months  
          after the child was born. 

          Similarly, state law permits an exception to the MFG rule if the  
          child is born as a result of the failure of one of three types  
          of contraceptives specified in statute:

                 An intrauterine device, 

                 Norplant (which was discontinued for use in the United  
               States in 2002 amid questions about its effectiveness and  
               lawsuits over its side-effects), 


          SB 23 (Mitchell)                                          PageI  

                 Sterilization of either parent. 

          Other states

          Beginning in the early 1990s, 24 states implemented family cap  
          rules. Today, just 16 states still have family cap rules in  
          place, including California. In 2002 and 2003, Maryland and  
          Illinois repealed their policies and were followed by Wyoming,  
          Nebraska, Oklahoma, Kansas and Maryland.<1>

          Effect on fertility rates 
           A number of research studies on the effects of the family cap  
          across the country have concluded that the cap had little to no  
          effect on fertility rates.<2> However, the U.S. General  
          Accounting Office noted in its 2001 examination of the issue  
          that most states implemented family caps as part of their  
          welfare reforms designed to provide incentives for women to  
          reduce the number of out-of-wedlock births and to encourage  
          self-sufficiency. Specifically, the study noted that "Due to  
          limitations of the existing research, we cannot conclude that  
          family cap policies reduce the incidence of out-of-wedlock  
          births, affect the number of abortions, or change the size of  
          the TANF caseload." It cited a number of methodological  
          limitations. It did note, however, that the family cap was  
          effective in reducing the amount that states were paying to  
          families who qualified for benefits.<3>  
          Effects of deep poverty on children
           Numerous studies have correlated the effects of deep childhood  
          <1> Welfare Rules Database, Urban Institute and "Bringing  
          Families out of Cap'tivity: The Need to Repeal the CalWORKs  
          Maximum Family Grant Rule," UC Berkeley School of Law, April  
          <2> Dyer, Wendy and Robert W. Fairlie, "Do Family Caps Reduce  
          Out-of-Wedlock Births?" Economic Growth Center, Yale University,  
          December 2003.
          <3> U.S. General Accounting Office, "More Research Needed on  
          TANF Family Caps and Other Policies for Reducing Out-of-Wedlock  
          Births," September 2001, p 2-3.


          SB 23 (Mitchell)                                          PageJ  
          poverty with poor health and outcomes including low birth  
          weight, lead poisoning, child mortality and hospitalization.  
          Other studies have drawn correlations between deep poverty and  
          repeating a grade, being a high school dropout and having a  
          learning disability. 

          A 2011 article in the journal Developmental Psychology<4>  
          estimated that a $1,000 increase in annual income - less than  
          $100 per month -- increases young children's achievement by 5 to  
          6 percent of a standard deviation. In 2000, researchers noted in  
          the journal Child Development that family caps and sanctions  
          appear to disproportionately affect families with very young  
          children who are most susceptible to adverse effects of deep  
          poverty and recommended policy considerations focus on avoiding  
          fiscal sanctions to those families.

               "Recent research suggests that economic deprivation is most  
               harmful to a child's chances
               for achievement when it occurs early in the child's life.  
               Economic logic suggests that policies aimed at preventing  
               either economic deprivation itself or its effects are  
               likely to constitute profitable social investments in the  
               twenty-first century." <5>

          Related legislation
          SB 899 (Mitchel 2014) was identical to this bill. It was held in  
          the Senate Appropriations committee.
          AB 271 (Mitchell, 2013) was substantially similar to this bill.  
          It was held in the Senate Appropriations committee.
          AB 22 (Lieber, 2007) was substantially similar to this bill. It  
          was held in the Assembly Appropriations committee.

          AB 473 (Brulte, Chapter 196, Statutes of 1994) created  
          California's maximum family grant (MFG) rule and required  
          California to obtain a federal waiver to implement it.

          <4> Duncan, Greg, et al, "Does Money Really Matter? Estimating  
          Impacts of Family Income on Young Children's Achievement With  
          Data From Random-Assignment Experiments," Developmental  
          Psychology, 2011, Vol. 47, No. 5, 1263-1279
          <5> Ibid


          SB 23 (Mitchell)                                          PageK  

               CWDA (Co-Sponsor)
               UDW/AFSCME Local 3930 (Co-Sponsor
               Western Center on Law and Poverty (Co-Sponsor)
               ACT for Women and Girls
               ACCESS Women's Health Justice
               Alameda County Board of Supervisors
               Alameda County Food Bank
               Alliance for Community Transformations 
               American Association of University Women 
               American Civil Liberties Union of California
               Asian Law Alliance
               Asian Pacific Policy & Planning Council 
               Association of California Commissions for Women (ACCW)
               Bay Area Legal Aid
               Black Women for Wellness 
               Business and Professional Women of Nevada County
               California Association of Food Banks
               California Black Health Network
               California Catholic Conference 
               California Communities United Institute 
               California Community College CalWORKs Association 
               California Family Health Council 
               California Food Policy Advocates 
               California Hunger Action Coalition
               California Immigrant Policy Center
               California Labor Federation 
               California Latinas for Reproductive Justice
                                                                                       California National Organization for Women 
               California Nurse - Midwives Association
               California Pan-Ethnic Health Network
               California Partnership
               California Reinvestment Coalition
               Californians United for a Responsible Budget
               California WIC Association
               California Women's Law Center
               Cal-Islanders Humanitarian Association
               Casa de Esperanza
               Center for Law and Social Policy


          SB 23 (Mitchell)                                          PageL  
               Center for Reproductive Rights and Justice at the  
               University of California, Berkeley School of Law
               Child Care Law Center
               Children Now
               Children's Defense Fund - California
               Chinese Progressive Association
               Citizens for Choice
               County of Los Angeles
               Courage Campaign 
               Department on the Status of Women
               East Bay Community Law Center
               Feminist Democrats of Sacramento County 
               Forward Together
               Friends Committee on Legislation of California
               Guam Communications Network
               Having Our Say
               Help a Mother Out 
               Housing California
               Interface Children & Family Services
               Jewish Family Service of San Diego
               John Burton Foundation
               Korean Community Center of the East Bay
               Law Students for Reproductive Justice
               League of Women Voters of California
               Legal Aid Society - Employment Law Center
               Libreria Del Pueblo, Inc.
               LIUNA Locals 777 & 792
               Los Angeles County Board of Supervisors
               Lutheran Office of Public Policy
               March of Dimes Foundation, California Chapter
               Monterey County
               NARAL Pro-Choice California
               National Center for Youth Law
               National Council of Jewish Women California
               National Health Law Program
               National Women's Political Caucus of California
               9 to 5 California
               Parent Voices'
               Partnership to End Domestic Violence
               Pacific Islander Cancer Survivors Network
               Peace Over Violence
               Physicians for Reproductive Health
               Planned Parenthood Affiliates of California
               Public Counsel's Children's Right Project and Homelessness  


          SB 23 (Mitchell)                                          PageM  
               Prevention Law Projects
               Public Interest Law Project
               Rainbow Services, Ltd.
               San Francisco Living Wage Coalition
               SEIU Local 721
               Sonoma County Human Services Department
               Special Needs Network, Inc.
               Starting Over, Inc.
               Strong Hearted Native Women's Coalition
               Tehama County Department of Social Services
               United Ways of California 
               Ventura County Board of Supervisors
               Western Regional Advocacy Project 
               Women's Health Specialist of California
               YWCA of Glendale 
               (Two individuals)



                                      -- END --