July 15, 2009 / 2:55 PM / 8 years ago

California's needy may bear brunt of budget crisis

7 Min Read

<p>Gennadiy Tomashov smokes outside his tent at a homeless tent city in Sacramento, March 15, 2009.Max Whittaker</p>

LOS ANGELES (Reuters) - An ill-timed pregnancy and domestic abuse left Amanda Garcia facing a dire future last year at the prime of life, until California's welfare-to-work program enabled her return to college after her baby was born.

Now the state's budget crisis is clouding her second chance for a college degree and a professional career. Garcia, 19, who aspires to become a police officer and a lawyer, just learned this month that her childcare assistance may be stopped.

"I started crying," she said, recounting the notice that brought to her suburban Los Angeles mailbox the reality of massive spending cuts likely to tatter California's social safety net starting later this year.

She is hardly alone.

From drug addicts facing longer waiting lists for rehab -- or jail terms if they fail to get in -- to recession-battered families newly dependent on low-cost health insurance for their children, California's budget turmoil is about to hit home for hundreds of thousands of its most vulnerable residents.

The scope and duration of impending cuts remain uncertain as state lawmakers and Governor Arnold Schwarzenegger tussle over a balanced-budget plan. Advocates of the poor say reductions under consideration would be devastating to the needy and impede the state's economic recovery.

They say many such cuts would ultimately cost the state more money than they save, as when elderly patients, forced out of adult day-care facilities, end up in nursing homes.

"It's penny-wise and pound-foolish," said Michael Herald, a lobbyist for the Western Center on Law & Poverty.

Losing Ground

The situation seems especially troubling for California, which has the largest population and economy of the 50 U.S. states. It is also one of the most socially progressive.

"California has been a leader, and I think this budget this year is definitely regressive. It takes us back decades," said Lydia Missaelides, executive director of the California Association of Adult Day Services in Sacramento.

California spent 70 percent more per capita than the rest of the country on social services in 2002, the last year such figures were available from the U.S. Census Bureau, according to a 2007 study by the Public Policy Institute of California.

Only New York spent more per capita -- California spends less on average per welfare recipient because the wider distribution of benefits means they are spread more thinly.

One rationale cited for California's generosity is that the cost of living in its biggest cities, where the bulk of aid to the poor is directed, runs higher than in much of the country.

Nick Johnson, an analyst for the Center on Budget and Policy Priorities, said social welfare programs have been especially hard hit in many states this year, including Arizona, Florida, Illinois, Massachusetts and Minnesota.

California's fiscal crisis is especially desperate.

Schwarzenegger and legislators are wrestling to close a $26.3 billion budget deficit created in large part by plunging revenues, the result of a deepening recession, rising unemployment and a prolonged housing slump.

County agencies administering the state's social welfare programs already are feeling the pinch from local funding cuts just as demands for their services are soaring.

"You have this big hole to fill in the budget, and at the 11th hour it's all about how you cut back on the poor," said Bill Taylor, director of intergovernmental relations for the Los Angeles County Department Public Social Services.

The outcome has life-altering implications for individuals like Garcia. She is one of 1.4 million people served by the state's CalWorks program, part of a federally backed initiative that has converted the nation's welfare system into a program designed to move poor, jobless Americans into full employment.

"It is a lifesaver. It means everything to me," said Garcia, who was fired from her last job in 2008 because of pregnancy complications that landed her in the hospital.

She left her boyfriend, the father of her child, when he became physically abusive five days after the baby was born. Turning up at a local welfare office, she enrolled in CalWorks, and within two months was back in college full time.

Generous to a Fault?

Schwarzenegger recently singled out welfare-to-work as one of numerous programs in need of reforms that he insists be included in a budget deal with lawmakers to root out "waste, fraud and abuse of your hard-earned tax dollars."

He said his revisions to CalWorks, including stricter eligibility for assistance, will save $753 million this year and $1.5 billion annually after that.

Welfare advocates say his plan puts a greater burden on cash-strapped counties and cuts vital services just as demand for them is on the rise. They cite studies showing CalWorks generates more than $7 billion in economic output.

Schwarzenegger argues that CalWorks is too lenient and that his reforms would rid the program of recipients who fail to meet federally mandated work requirements.

Taylor said the governor's proposal would immediately dump over 30,000 families, including more than 70,000 children, from the welfare-to-work program in Los Angeles County alone.

Herald said 250,000 children statewide would be cut off from cash assistance.

"And those are the children who sadly will probably end up in our child welfare system, which the governor is cutting by 10 percent," Herald said. "So we're going to dump more kids into the system and have less money to care for them."

Other safety-net programs on the chopping block include state-funded health insurance for children of low-income families; daycare facilities and in-home healthcare for the elderly and disabled; and a program providing treatment rather than jail time for first-time drug offenders.

Garcia and other CalWorks recipients say they follow news of the state budget crisis but try not to dwell on it.

"I try to be optimistic," Garcia said with a shy smile. I've been though a lot. And I just need to find a way to get through it for my son."

Editing by Howard Goller and James Dalgleish

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