CIPC Update Governor May Budget Revision

CIPC UPDATE
GOVERNOR'S MAY BUDGET REVISION
May 16, 2007

GOVERNOR'S REVISED BUDGET CONTAINS CUTS TO PROGRAMS FOR LOW-INCOME CALIFORNIANS

On May 14, 2007, Governor Schwarzenegger released the May Revise of his budget
proposal for the 2007-2008 fiscal year. Despite a recent slump in revenues, the
administration insists on increasing payments on bonds in hopes of getting the state
out of debt more quickly. In order to achieve this, the budget moves to cut funding
for vital programs and privatize state assets. Under the proposed budget, the state
would sell EdFund, a state operated fund that insures loans for approximately half
of California's college students, bringing the state an additional $1 billion in
revenue. The administration also plans to encourage privatization of the state-run
lottery.

In January, the administration proposed $600 million in cuts to human services,
including proposals to make significant changes to CalWORKs that will cut aid to
some of California's poorest families with children. Now, the governor is also
proposing to cut $185 million from programs serving low- income seniors and persons
with disabilities. Some of the May Revision proposals affecting low- wage families
are described below.


SOCIAL SERVICES
SUPPLEMENTAL SECURITY INCOME/STATE SUPPLEMENTAL PAYMENT (SSI/SSP) - The Governor's
May Revise suspends the January 2008 state Cost of Living Adjustment (COLA) in the
SSI/SSP program,
effectively cutting $185 million from the program. The Revise,
however, leaves the smaller federal COLA untouched, giving individuals a seven
dollar increase on their monthly grant of $856 and couples a twelve dollar increase
on their $1502 grant. This assistance is often the only income for seniors and
persons with disabilities. Given California's rapidly rising cost of living and the
rate of inflation, the real value of SSI/SSP payments over the years has diminished
drastically.

In addition, the following proposals remained unchanged from the Governor's January
budget proposal:

CALWORKS - California's version of Temporary Assistance for Needy Families (TANF),
this program provides cash grants to adults for a maximum of five years while
promoting work participation and self-sufficiency. Currently, when the state
sanctions a parent by cutting or suspending their aid for failing to comply with
work requirements, the state continues to provide aid to children in the household.
The governor proposes to make several policy changes to the CalWORKs program that,
if enacted, would for the first time terminate the safety net for children.

FULL FAMILY SANCTIONS - When a parent falls out of compliance with work
requirements, California removes the parent from the CalWORKs cash grant but
continues to provide a safety net benefit for children. This proposal terminates
assistance to children unless the parent can come into compliance within 90 days.

CUT CHILD SAFETY NET FOR PARENTS OUT OF COMPLIANCE - Once a parent has reached the
5-year lifetime limit of aid, California removes the parent from the cash grant but
continues to provide assistance for children. This proposal cuts the child safety
net unless the parent who is no longer receiving assistance continues performing the
program's required work activities.

CUT CHILD SAFETY NET FOR INELIGIBLE PARENTS - This proposal terminates cash
assistance to the children of parents who are ineligible for CalWORKs, including the
children of immigrants. This measure does nothing to improve the state's work
participation rates or avoid fiscal penalties since these parents are not part of
the federal work participation calculation.

These proposed changes will result in a $324 million reduction in CalWORKs
expenditures by effectively kicking families out of the program. The administration
states that this will encourage families to achieve self-sufficiency. However,
research indicates that parents on aid face significant barriers to employment and
sanctioned families need services and counseling. Such punitive
policies only punish children who depend on this aid to meet their most basic needs.
Continuing aid to children allows counties to identify and address the needs of the
adults while ensuring that these families have the resources necessary to maintain
the well-being of their children. Finally, the governor proposes to cut an
additional $140 million from CalWORKs by suspending the COLA, thereby depriving
working poor families of a much needed increase in aid that would only serve to keep
up with the rising cost of living in California.

NATURALIZATION SERVICE PROGRAM (NSP) - NSP provides funding to local governments and
community-based organizations to assist immigrants through the naturalization
process. The Administration proposes to maintain NSP funding at $3 million for
07-08. California has nearly 3 million immigrants who are eligible to apply for
citizenship and this level of funding is simply too low to keep up with the waiting
list of people who are eligible and eager to begin the path towards citizenship.

EMERGENCY FUNDING FOR FOOD BANKS - Earlier this year, the state provided food banks
with $4.7 million in order to respond to last winter's citrus freeze by purchasing
and distributing food to affected individuals. Last month, the federal government
began to fulfill its commitment to provide 1500 truckloads of federal commodities.
The governor proposes allocating an additional $4.45 million in order to store and
distribute these additional food resources.


PUBLIC HEALTH
MEDI-CAL MANAGED CARE - The May revision includes $107 million to provide rate
adjustments to Medi-Cal managed care plans in order to provide a transition period
to plans that would have otherwise received rate reductions. This transition period
is essential to help ensure that the 3.2 million Medi-Cal recipients continue to
receive care.

IMPLEMENTATION OF THE DEFICIT REDUCTION ACT - The May revision includes a $39.4
million increase to counties for administration and implementation of the new
federal Deficit Reduction Act
(DRA) citizenship verification requirements.

CIPC will provide updates as budget negotiations continue. For more information
regarding the 2007-2008 State Budget and the May Revise, please visit
http://www.dof.ca.gov. If you have any questions regarding this update, contact Layla
Razavi at 916.448.6762, ext. 202.





Asian Pacific American Legal Center Coalition for Humane Immigrant
Rights of Los Angeles
National Immigration Law Center Services, Immigrant Rights and
Education Network
Asian Pacific American Legal Center Coalition for Humane Immigrant
Rights of Los Angeles
National Immigration Law Center Services, Immigrant Rights and
Education Network



We respect your online privacy. If you would like to be removed from this list,
please click here:
http://www.responsetrack.net/remove1/?13ER5007VDO




------------------------------------
The California Partnership/Center for Community Change Alicia Lepe Organizer
alepe [at] communitychange.org
2533 W. 3rd Street, Suite 101
Los Angeles, CA 90057
tel: (626) 224-8189
fax: (866) 337-7909
mobile: (626) 224-8189 Best way to contact
------------------------------------