REPORT TITLE:
Welfare Reform


DESCRIPTION:
Requires DHS to keep rollover funds from general assistance;
requires DHS to place disabled children under TAONF program into
SSI program; makes appropriation for GA program; makes three
appropriations for DHS to purchase services from nonprofit
entities to aid welfare recipients; bases TANF benefits on
current federal poverty level; requires LRB to study the general
assistance program.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
THE SENATE                              S.B. NO.           171
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO WELFARE REFORM. 


BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1                              PART I
 
 2      SECTION 1.  Chapter 37, Hawaii Revised Statutes, is amended
 
 3 by adding a new section to part III to be appropriately
 
 4 designated and to read as follows:
 
 5      "§37-     Department of human services; carryover of funds.
 
 6 (a)  The department of human services may retain any
 
 7 appropriation for general assistance to households without minor
 
 8 dependents at the close of a fiscal year and the funds retained
 
 9 shall not lapse until June 30 of the first fiscal year of the
 
10 next fiscal biennium; provided that the funds shall first be
 
11 expended on each eligible recipient to the maximum provided by
 
12 law.  The department of human services shall submit a report to
 
13 the director of finance, by the close of the first fiscal year,
 
14 identifying the total amount of funds that will carry over to the
 
15 second fiscal year with a copy of this report to the legislature
 
16 at least twenty days prior to the convening of the next regular
 
17 session of the legislature.
 
18      (b)  Any appropriation retained in accordance with this
 
19 subsection (a) shall be used exclusively for general assistance
 

 
Page 2                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 to households without minor dependents; provided that the
 
 2 retention of an appropriation shall not be used as a basis for
 
 3 reducing future budget requirements."
 
 4      SECTION 2. Chapter 346, Hawaii Revised Statutes, is amended
 
 5 by adding a new section to be appropriately designated and to
 
 6 read as follows:
 
 7      "§346-     Disabled children to be placed in federal
 
 8 program.  The department shall endeavor to place qualifying
 
 9 children under the age of eighteen years who receive benefits
 
10 under the State's temporary assistance to other needy families
 
11 program into the Federal Supplemental Security Income Program in
 
12 order to receive federal public assistance."
 
13                              PART II
 
14      SECTION 3.  The legislature finds that the cash grant under
 
15 the temporary assistance to needy families (TANF) program is
 
16 limited to 62.5 per cent of the standard of need (federal poverty
 
17 level).  With the continuous rise in the cost of living in
 
18 Hawaii, poor families effectively receive fewer dollars under
 
19 TANF, because inflation eats away at buying power.  This has
 
20 resulted in the TANF cash grant being half of the federal poverty
 
21 level.
 
22      The legislature further finds that in 1996, as part of
 
23 Hawaii's welfare reform, monthly TANF grants were cut an
 

 
Page 3                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 additional twenty per cent for 15,000 families.  The typical TANF
 
 2 family of a mother and two young children saw their benefits cut
 
 3 from $712 to $569 per month.  This is inadequate to afford rent,
 
 4 electricity, water, and other necessities such as transportation,
 
 5 clothes, laundry, detergent, and school supplies.  This is also
 
 6 the largest cut in grants anywhere in the country in the history
 
 7 of the welfare program.  While the twenty per cent reduction in
 
 8 case assistance was meant to be an incentive for individuals to
 
 9 work (individuals on welfare are truly willing to work), the
 
10 Hawaii economy is not healthy, and there are an insufficient
 
11 number of jobs to employ all the families who are able to work.
 
12      The legislature further finds that in 1995, the State "block
 
13 granted" its general assistance program to the disabled who are
 
14 unable to work.  This meant that the State set a limit on the
 
15 amount of money it would spend on general assistance no matter
 
16 how many people needed the program.  In order to stay within the
 
17 budget, the department of human services lowered and then raised
 
18 the monthly general assistance grant several times.  The lowest
 
19 grant was $217 per month and the highest was $418 per month.
 
20 These fluctuations created real problems in finding and keeping
 
21 housing for people with only general assistance money to live on.
 
22 It also made life very unstable for people who desperately need
 
23 stability, causing unparalleled hardship and increased
 
24 homelessness among Hawaii's needy.  
 

 
Page 4                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1      The purpose of this Part is to afford a fair and equitable
 
 2 solution to Hawaii's cash assistance to needy families.
 
 3      SECTION 4.  Section 346-53, Hawaii Revised Statutes, is
 
 4 amended by amending subsection (a) to read as follows:
 
 5      "(a)  This subsection does not apply to general assistance
 
 6 to households without minor dependents.  The standard of need for
 
 7 families of given sizes shall equal the current poverty level
 
 8 established by the federal government [in 1993], prorated over a
 
 9 twelve-month period.
 
10      The assistance allowance provided shall be based on a
 
11 percentage of the standard of need.  For exempt households and
 
12 households in which all caretaker relatives are minors, living
 
13 independently with minor dependents and attending school, the
 
14 assistance allowance shall be set at sixty-two and one-half per
 
15 cent of the standard of need.  For all other households, the
 
16 assistance allowance shall be set no higher than sixty-two and
 
17 one-half per cent of the standard of need and set no lower than
 
18 fifty per cent of the standard of need.  The standard of need
 
19 shall be determined by dividing the [1993] current federal
 
20 poverty level by twelve and rounding down the quotient.  The
 
21 remaining quotient shall be multiplied by the per cent as set by
 
22 the director by rules pursuant to chapter 91 and the final
 
23 product shall be rounded down to determine the assistance
 
24 allowance; provided that:
 

 
Page 5                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1      (1)  The department may reduce the assistance allowance as
 
 2           determined in this subsection for non-exempt households
 
 3           for the purpose of providing work incentives or
 
 4           services under part XI of this chapter;
 
 5      (2)  No reduction shall be allowed that jeopardizes
 
 6           eligibility for or receipt of federal funds;
 
 7      (3)  Reductions in the assistance allowance shall be limited
 
 8           to no more than one per year; and
 
 9      (4)  No non-exempt household, which includes an adult who
 
10           has received sixty cumulative months of temporary
 
11           assistance to needy families with minor dependents,
 
12           shall be eligible for an assistance allowance, unless
 
13           authorized by federal regulations."
 
14                             PART III
 
15      SECTION 5.  The legislature finds that the allocated funding
 
16 for the general assistance to households without minor dependents
 
17 program (GA) was cut in the fiscal biennium 1997-1999, resulting
 
18 in diminished benefits for needy recipients.
 
19      The purpose of this Part is to make an appropriation to
 
20 restore funding for the GA program to bring recipients back up to
 
21 the level of monthly benefits they received before the cuts.
 
22      SECTION 6.  There is appropriated out of the general
 
23 revenues of the State of Hawaii the sum of $2,800,000, or so much
 

 
Page 6                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 thereof as may be necessary for fiscal year 1999-2000, and the
 
 2 same sum, or so much thereof as may be necessary for fiscal year
 
 3 2000-2001, to supplement the budget appropriation for the fiscal
 
 4 biennium 1999-2001, for funding for the general assistance
 
 5 program; provided that the amount of monthly benefit per
 
 6 recipient shall increase from $388 per month to not less than
 
 7 $418 per month for the fiscal biennium 1999-2001.
 
 8      SECTION 7.  The sum appropriated under this Part shall be
 
 9 expended by the department of human services.
 
10                              PART IV
 
11      SECTION 8.  Medicare is the federal health insurance program
 
12 for Americans age sixty-five and older and certain disabled
 
13 people.  All recipients of Social Security retirement benefits
 
14 are automatically entitled to Medicare, which is funded totally
 
15 by the federal government.
 
16      The legislature finds that the State should make all efforts
 
17 to maximize federal Medicare coverage for eligible citizens of
 
18 Hawaii, in order to save the State from the alternative of
 
19 providing Medicaid coverage or other medical benefits for
 
20 eligible elders, which involves state matching funds.
 
21      The legislature further finds that one or more private
 
22 nonprofit entities have Medicare advocacy programs to help
 
23 Medicare applicants to respond to the high percentage of wrongful
 

 
Page 7                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 denials of Medicare coverage.  The programs educate seniors about
 
 2 their entitlements and rights under Medicare and represent them
 
 3 on appeal of their denial of Medicare benefits.  The legislature
 
 4 further finds that these programs have the potential to save the
 
 5 State substantial money.
 
 6      The purpose of this Part is to appropriate funds for the
 
 7 purchase of health and human services for Medicare advocacy
 
 8 programs.
 
 9      SECTION 9.  There is appropriated out of the general
 
10 revenues of the State of Hawaii the sum of $180,000, or so much
 
11 thereof as may be necessary for fiscal year 1999-2000, for the
 
12 purchase of health and human services for Medicare advocacy
 
13 programs.  
 
14      SECTION 10.  The sum appropriated under this Part shall be
 
15 expended by the department of human services for the purposes of
 
16 this Part.
 
17                              PART V
 
18      SECTION 11.  The legislature finds that the neighbor islands
 
19 have an backlog of foster children awaiting adoptions.  Foster
 
20 care for these children is subsidized by the State.  The
 
21 legislature further finds that one or more nonprofit entities
 
22 have programs for adoptive families to facilitate the adoption of
 
23 foster children.  The programs provide free, comprehensive legal
 

 
Page 8                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 services to families who wish to adopt.  These services include
 
 2 legalizing adoptions, obtaining Social Security benefits for
 
 3 qualified adopted children, applying for adoption assistance
 
 4 under the federal Title IV-E program, helping families place
 
 5 children in special education programs if needed, obtaining
 
 6 Medicaid and other medical and public benefits for eligible
 
 7 children, and helping adoptive parents to apply for federal tax
 
 8 credits for adoptions.
 
 9      The purpose of this Part is to appropriate funds for the
 
10 purchase of health and human services for programs for adoptive
 
11 families.
 
12      SECTION 12.  There is appropriated out of the general
 
13 revenues of the State of Hawaii the sum of $120,000, or so much
 
14 thereof as may be necessary for fiscal year 1999-2000, for the
 
15 purchase of health and human services for programs for adoptive
 
16 parents.
 
17      SECTION 13.  The sum appropriated under this Part shall be
 
18 expended by the department of human services for the purposes of
 
19 this Part.
 
20                              PART VI
 
21      SECTION 14.  The legislature finds that the federal earned
 
22 income tax credit is an important income supplement for the
 
23 working poor.  The credit operates as a refund that can be as
 

 
Page 9                                                     
                                     S.B. NO.           171
                                                        
                                                        

 
 1 much as $3,756, effectively bringing money into Hawaii from the
 
 2 federal government.  The legislature further finds that an
 
 3 estimated twenty-five per cent of those eligible for the credit
 
 4 are unaware of their eligibility.  The Internal Revenue Service
 
 5 tax figures for 1996, seem to indicate that there may have been
 
 6 as much as $12,000,000 or more that was not claimed in Hawaii.
 
 7 In addition to the credit, new federal tax credits of up to $400
 
 8 may be claimed per child in 1998 tax returns.
 
 9      The legislature further finds that there are one or more
 
10 nonprofit entities that have earned income tax credit programs to
 
11 assist eligible families and individuals to claim the eligible
 
12 credits.
 
13      The purpose of this Part is to appropriate funds for the
 
14 purchase of health and human services for earned income tax
 
15 credit programs.
 
16      SECTION 15.  There is appropriated out of the general
 
17 revenues of the State of Hawaii the sum of $70,000, or so much
 
18 thereof as may be necessary for fiscal year 1999-2000, for the
 
19 purchase of health and human services for earned income tax
 
20 credit programs.
 
21      SECTION 16.  The sum appropriated under this Part shall be
 
22 expended by the department of human services for the purposes of
 
23 this Part.
 

 
Page 10                                                    
                                     S.B. NO.           171
                                                        
                                                        

 
 1                             PART VII
 
 2      SECTION 17.  The legislature finds that the general
 
 3 assistance to households without minor dependents program, better
 
 4 known as general assistance, continues to be the subject of
 
 5 controversy about issues ranging from justification for the
 
 6 program, eligibility criteria, and levels of funding.  The
 
 7 legislature further finds that an independent study is needed to
 
 8 objectively evaluate the program in order for the legislature to
 
 9 make informed and prudent decisions about appropriations and
 
10 statutory changes regarding the program.
 
11      The purpose of this Part is to direct the legislative
 
12 reference bureau to conduct a study on the general assistance
 
13 program.
 
14      SECTION 18.  The legislative reference bureau shall conduct
 
15 a study of the general assistance to households without minor
 
16 dependents program, formerly known as general assistance, as
 
17 established under part III of chapter 346, Hawaii Revised
 
18 Statutes.  The study shall make determinations regarding:
 
19      (1)  Revision of eligibility criteria, with a view towards
 
20           balancing competing needs of the recipients and the
 
21           ability of the State to pay benefits;
 
22      (2)  Limitations on state expenditures on the program,
 
23           including but not limited to time limits on receiving
 

 
Page 11                                                    
                                     S.B. NO.           171
                                                        
                                                        

 
 1           benefits and transferring recipients to other public
 
 2           assistance programs;
 
 3      (3)  Setting statutory ceiling on the amount of benefits
 
 4           received per recipient;
 
 5      (4)  Alternatives for funding the program, including but not
 
 6           limited to, appropriations by the legislature,
 
 7           executive budget allocations, or creating a special
 
 8           fund; and
 
 9      (5)  Whether or not the program should be terminated.
 
10      The department of human services shall collaborate and
 
11 cooperate with the legislative reference bureau for the purposes
 
12 of this study.  The legislative reference bureau shall seek input
 
13 from the Legal Aid Society of Hawaii.
 
14      The legislative reference bureau shall report its findings
 
15 and recommendations to the legislature not later than twenty days
 
16 prior to the convening of the regular session of 2000.
 
17      SECTION 19.  Statutory material to be repealed is bracketed.
 
18 New statutory material is underscored.
 
19      SECTION 20.  This Act shall take effect upon its approval;
 
20 provided that sections 6, 9, 12, and 15 shall take effect on July
 
21 1, 1999.
 
22 
 
23                           INTRODUCED BY:  _______________________