Wilson, Allies Seek to Make Cuts in Welfare Benefits Permanent

SACRAMENTO —  A few years ago, the Legislature passed and Gov. Pete Wilson signed into law a wide range of temporary cuts in benefits to the poor, elderly and disabled that were intended to help a cash-strapped state government ride out California’s severe recession.

Now, with the state’s economy on the upswing, the previous level of those benefits and the cost-of-living increases that went with them are scheduled to be reinstated automatically.

But Wilson and his allies in the Legislature maintain that that’s the problem with such programs these days--they are on “autopilot,” rising whether they need to or not.

Recession-inspired benefit reductions, they maintain, should remain in force. Toward that end, the administration and Assembly Republicans are aggressively pursuing legislation to make the rates permanent, touching off one of the most heated partisan debates of the session.

Democrats charge that the legislation is a wholesale attack on the poor.

A bill to deny a resumption of full benefits for welfare families, foster care facilities, the aged, blind and disabled has been approved by two committees of the GOP-majority Assembly and is headed for a floor vote, possibly as early as Monday.

At stake are benefits and programs affecting about 3.7 million people.

Assemblyman Tom Bordonaro (R-Paso Robles), author of the Wilson-sponsored legislation, said passage is needed to prevent “blowing a hole in the budget of approximately $1.2 billion,” the administration’s estimate on the cost of restoring the cuts.

“What this bill is saying is that this legislature has an obligation to review everybody’s budget and nobody is entitled to an automatic increase,” Bordonaro said at a hearing last week.

H.D. Palmer, Wilson’s budget spokesman, said the governor’s priorities rest with education, public safety and preventive programs. With revenues showing improvement, he said, “the governor does not believe that the first call on those revenues should go to double-digit cost-of-living increases for welfare recipients.”

The implications for the budget are exaggerated, Democrats say.

Senate Leader Bill Lockyer (D-Hayward) walked into one of the Assembly hearings recently and announced that the bill would never survive in the Democratic-controlled Senate.

The measure targets “the most vulnerable,” its critics complain, while the well-off, who also were required to sacrifice back in 1991, are reaping a benefit. When the recession ended and it came time to relieve the burdens on the two groups, a surtax that had been placed on high-earners was lifted. But with passage of the Bordonaro bill, Democrats complain, the extra load on the poor would continue.

The administration measure, said Assemblyman Tom Bates (D-Berkeley) as hearings began two weeks ago, “is the single most mean-spirited bill of the year.” Both the poor and the wealthy made sacrifices five years ago, “but now the tax hike [on high incomes] has ended, yet the governor wants to maintain and deepen the cuts on the poor,” Bates said.

As of the first of this year, state income taxes that in 1991 were raised to 10% for individuals earning $100,000 and couples making $200,000--and to 11% in higher brackets--dropped back to the present maximum of 9.3%.

The well-off stand to gain further, Democrats charge, if Wilson succeeds in enacting a 15% corporate and personal income tax cut for all.

“We kept our promise to the rich but not the most destitute,” said Jonathon Lightman of the National Assn. of Social Workers.

The battle lines in the dispute were drawn in 1991 with recession-plagued California facing a $14-billion state budget deficit. Benefit cuts and tax increases were passed, but with lawmakers looking to better days, they were scheduled to end in mid-1996.

That meant that a welfare mother of two had her monthly benefit cut about $30 to $663 in 1991, and it was reduced later to $607. Come June 30, she can expect a check of $643 if the law remains on the books.

But with passage of the Bordonaro bill, the welfare mother could see her benefit decline. In May, her $607 would drop to $594, assuming federal welfare guidelines are amended, according to a spokeswoman for the state Health and Welfare Agency. With further cuts sought by Wilson, the amount could decrease again about $50. Food stamps from the federal government would continue to supplement a recipient’s state-issued check.

The Bordonaro legislation also calls for:

* Keeping the monthly benefit for the aged and disabled at an average $626 a month instead of allowing it to rise about $40 in coming months. The blind receive about $50 more. Disabled and blind people using guide dogs are provided a further stipend. But state funds cut off in 1992 for such purposes as making home repairs for the disabled remain frozen.

“We can’t afford to rebuild roofs with state dollars, but we can continue to take care of [guide] dogs that people need,” said Janice Ploeger-Glaab, a spokeswoman for the state welfare agency.

* The measure would also hold steady the reduced rates that providers of services to adults with disabilities receive from the state. Providers run workshops for the mentally retarded and also arrange to place them with outside employers. State officials said an average of $402 a month is paid per person in such programs, the amount going to the nonprofit organization in charge. If the freeze were lifted, that amount would rise to $474.

Providers were counting on the increase, according to Lorrie Shields of the Assn. for Retarded Citizens. “The freeze prevented us from hiring quality people. This just makes things worse,” she said.

* In a related program, the bill would also hold the line on support for 21 nonprofit regional centers serving people with disabilities. The centers assess the care needed as well as provide and purchase services and equipment for 135,000 people statewide. The freeze would block a resumption of funding totaling $56 million a year, state officials estimate.

* The bill would retain at 1990 levels financial support for a system of group homes serving 19,000 foster children. State funds moved up slightly in subsequent years, but an additional cost-of-living adjustment halted in 1991 would remain unavailable for at least a year. The lack of sufficient funds to cover costs ranging from $1,200 to $5,000 per month per child has left the program seriously underfunded, according to the California Assn. of Services for Children.