Welfare Revisions to Meet U.S. Law OK, Court Rules

The California Supreme Court, removing a legal cloud over a wide range of federally supported state welfare programs, ruled Thursday that the Legislature may give state agencies power to revise such programs so they conform with federal law.

The justices unanimously overturned an appellate court decision last year that said the state Constitution bars administrative agencies from refusing to implement state law governing the programs because of conflicts with federal policies.

State officials had appealed that decision, saying it cast doubt on the continued validity of several similarly worded provisions in the Medi-Cal, food stamp, aid to families with dependent children and other state programs supported by hundreds of millions of dollars in federal funds.

The high court, in an opinion by Justice Allen E. Broussard, held that there was nothing in the Constitution to stop the Legislature from directing state agencies to make sure programs did not run afoul of federal rules, even if it meant changes in a state program.

“To assure the continued availability of federal funds for these programs, the state must operate plans which conform to the governing federal statutes and regulations,” Broussard wrote. “As these myriad guidelines are subject to constant change, the state plans must remain flexible in their application. . . . “

The purpose of the state constitutional provision at issue, Broussard wrote, “was to prevent agencies from using their own interpretation of the Constitution or federal law to thwart the mandates of the Legislature.”

State Deputy Atty. Gen. John J. Klee Jr. praised the ruling, saying it assured the continuing validity of a variety of legislative mandates requiring agencies to implement state statutes so as not to conflict with federal laws.

“If that sort of provision had been declared invalid, who knows what would have happened to the food stamp program, for example,” he said. “It might have meant that a lot of poor people would not have received food stamps, and we didn’t want that to happen.”

Medi-Cal Act Provision

The case arose from a provision of the Medi-Cal Act passed in 1984 with the aim of preventing reductions in benefits received by the spouse of an aid recipient living in a nursing home. But the Legislature said also that the provision was not to be implemented if it conflicted with federal regulations.

Subsequently, federal officials concluded that the state’s new law violated federal rules. Officials of the state Health Services Department then declined to implement the measure.

A group of Medi-Cal recipients, represented by legal aid lawyers, brought suit against the state, demanding payment of increased benefits and contending the department had no authority to refuse to implement the 1984 provision.

An Alameda County Superior Court judge and a state Court of Appeal in San Francisco ruled in favor of the recipients, finding that the state agency’s action violated a 1978 state Constitutional amendment saying that agencies have “no power . . . to declare a statute unenforceable, or to refuse to enforce a statute” because of conflict with federal law unless an appellate court has found such a conflict exists.

Federal Court Decision

Ironically, while the matter was in state courts, a federal appeals court in San Francisco held in a separate case that the state welfare law did not conflict with federal regulations and that Medi-Cal recipients were entitled to the benefits they had sought.

In Thursday’s ruling, the justices acknowledged that the issue arising from the 1984 statute had been legally resolved by the federal court. But they said they were deciding the state case anyway because of its “profound implications” for the state’s participation in a number of state-federal welfare programs.