The Price of a ‘No-Free-Lunch’ Era : Welfare: An overhaul of the county’s General Relief program has created a new crop of inequities.

In 1980, when a bad economy and rising poverty forced the Republican candidates for Orange County supervisor to debate welfare, the issue turned into a contest over who was tougher on fraud and laziness.

Supervisor Roger R. Stanton won the election. And following through on his campaign promise, he helped create what is still one of California’s most extensive welfare-fraud units as well as a rigorous workfare program, in part, to drive home the message that “there is no free lunch.”

“In the political world, workfare is probably a good thing to be supportive of,” Stanton said recently. “There is in this country a negative connotation attached to the welfare system, and workfare puts integrity into the system.”

The politics of welfare in Orange County assumes that everybody has bootstraps, if they want to use them. But almost 10 years after the 1980 campaign led to an overhaul of the county’s General Relief program, many of its goals and assumptions appear confused and unmet.

General Relief “is almost money down the drain,” said Jean Forbath, director of Share Our Selves, a Costa Mesa-based advocacy group for the poor. “You can’t stop, because it’s putting the finger in the dike. But it’s not solving the problems.”

The $8-million General Relief program--completely funded by county taxpayers--is supposed to provide most needy, childless adults with housing, food, clothing and transportation.

Unlike its larger state-funded counterpart--Aid to Families with Dependent Children--the program’s rules and benefits are largely set by Orange County’s five county supervisors.

For example, the workfare program here, much like those in other counties, requires that recipients who are healthy spend two days per week searching for a job and up to three days each week working for the county, mainly in maintenance or clerical jobs.

It is a politically popular program because it presumes that there will be aid only for the diligent and deserving. The reality, however, is much different.

Consider:

* County officials estimate that up to 90% of the General Relief workfare clients are homeless, even though state law requires that they be provided a large enough benefit to pay for housing. Housing in Orange County is expensive--more than $20 per night in the cheapest motel. The maximum General Relief payment in Orange County--for housing, food and all other living expenses--is about $11 per day.

* More than half of the clients in the General Relief workfare program suffer from alcoholism, drug addiction or mental handicaps, county records show. Still, partly because there are not enough medical facilities to care for them, most are required to maintain a rigorous five-day-per-week schedule of work and job searches to receive their welfare payment. About two-thirds of all workfare clients are cut off from their aid because they fail to maintain the schedule.

* Despite all of the county’s safeguards for fraud and abuse, officials acknowledge that many times, the cash they give out for living expenses is used to finance drug or alcohol addictions. Some clients are so severely addicted that they are declared unemployable, allowing them to receive their aid payment without having to join the work program.

“Rather than helping the person overcome his problems, we’re giving him what he needs to perpetuate it,” Larry Leaman, director of the county’s Social Services Agency, conceded. “There is a dilemma when you hand a substance-abusing client a cash grant.”

While most of the state’s AFDC welfare clients are women and children, almost all of the county’s General Relief recipients are men, mostly young. They are victims of poverty and, at the same time, of a popular perception that a young male should be self-sufficient and, if he is not, it is his own fault.

The problem, county officials admit, is that the system does not account for the many single men trapped in poverty who are also suffering from addictions or paralyzing emotional problems such as hopelessness and loss of esteem.

“Government can only do so much,” said Supervisor Gaddi H. Vasquez. “It is willing to give a hand to those who want assistance, but we’re not going to force-feed those who don’t want to be helped.”

Susan Bagarry, director of the county’s welfare office in Anaheim, said the county is “not very hospitable” to people on welfare. “Personally, I don’t know how they make it,” she said.

Part of the politics of welfare, officials say, is that there is not a lot of public sympathy for poor single males and so there is not a strong incentive for the county to spend more money or provide more care.

Partly because the General Relief program does not have a high political priority, it has not been monitored closely. The county has done little research to determine if the program’s goals are being met since the system was overhauled in 1980--even though there is evidence of problems.

One of the main goals of workfare was to move people off the welfare rolls by preparing them for a job. But the county has not done any analysis to see if that objective is being met, even though there is skepticism among experts.

There are not even any figures on how much is needed to cover the cost of shelter for the night, county officials say. While they maintain it is possible to find housing at General Relief rates of about $8 a night, Leaman admitted that actually “nobody knows” what it would cost.

Scott Mather, head of the county’s Homeless Issues Task Force, said the lack of information serves to protect the county from further expenditures. “If you don’t recognize there’s a problem, then you don’t have to spend more money,” he said.

Another of the primary goals in overhauling the welfare system was to reduce the county’s cost. By requiring the recipients to participate in a rigorous workfare program and taking a hard line on law enforcement, the supervisors said the county would save money by reducing its welfare population to those willing to work for their benefits.

Orange County last year sent 6,332 clients to its workfare program. Almost as many were found to be eligible for General Relief, but unable to work because of a disability.

The last time the county checked whether its workfare program was saving money was in 1982. At that time, a study concluded there was a savings. But a cost analysis done recently by the county for The Times Orange County Edition indicates the program has lost money for the county.

The study for The Times found that it cost the county $552,790 to operate the workfare program for the year ending last February--including employee salaries and benefits. But it estimated that the program only deterred enough people to save $431,305 in aid payments.

Ron Kersh, the county analyst, also said there was a potential $137,000 savings generated by those in the work program performing tasks for the county. That savings was calculated by applying the $4.35 hourly minimum wage to the number of hours worked by welfare clients.

But he called that a “soft savings” because the jobs assigned to welfare clients are intentionally superfluous to the county staff. County rules prohibit a welfare client from replacing a salaried employee because of protests from county unions and because the welfare workers are largely unreliable.

Despite the questions about its effectiveness, Diane Edwards, head of the General Relief program, insisted that there are intangible savings and that the program is cost-effective.

After examining the apparent cost shortfall, she said: “In today’s situation, it’s hard to come up with a dollar amount. I believe it, I just can’t prove to you that it is just as cost-effective as it was” in 1982.

Orange County’s problems in providing for its poor on General Relief are severe, but they are not unique. Several other counties, particularly those with urban areas, also have homeless and addicted clients in their aid programs.

But Orange County’s problem is exacerbated by its lack of low-income housing, such as that found in the state’s largest cities.

In Los Angeles, for example, the county does not give cash to its clients for housing. Instead, it has contracts with some of its cheapest hotels and it gives clients a voucher that is redeemable only for a room.

Under the program, said Bob Morrell, head of the Los Angeles General Relief office, there is a bed identified for every client and the city avoids giving out some of the cash that might be used to buy drugs or alcohol.

In Orange County, however, almost all of the very-low-income hotels--known as SROs for Single-Room Occupancy--have been demolished over the last few years by municipal redevelopment projects. So county officials say they are forced to give out cash.

Leaman also said that with a voucher system the county could be liable for health and safety conditions in the hotels. And, he said, some clients would trade the vouchers for cash or drugs anyway, as they do in Los Angeles.

Orange County also has one of the highest General Relief payments in the state--up to $341 per month for an individual. That is largely due to the high cost of housing in the area, and it is a rate the county was forced to pay after a lawsuit was filed by the Legal Aid Society. General Relief recipients are also eligible for up to $90 per month in food stamps, paid for by the federal government.

Even with the county’s high payment, though, Orange County’s $7-million annual bill for General Relief in 1988 was much lower than most areas its size.

San Diego County, with a $275 maximum monthly payment, spent $16.5 million in 1988 on its General Relief budget. And Alameda County, with a $310 maximum payment, spent $17.4 million.

Orange County officials say their cost is so much lower because less than 3% of the population is below the poverty line. But critics, such as Forbath, charge that it is also because Orange County is more successful in deterring applicants.

Asked overall how the county’s welfare program is serving those in need, Leaman pondered the question and said, “On a scale of 1 to 10, I’d say 8.”

Then he volunteered a perspective for his conclusion.

“The biggest thing a manager in this field has to deal with is that these programs are run by a political process and a judicial process--and the result is a compromise on almost every issue.

“(It’s) a system that almost no real skilled manager would design,” he said. “Overall, the program is keeping a lot of people afloat. So, given that world, it’s a miracle the system is serving the needs as well as it is.”

SAVINGS FROM WELFARE FRAUD CRACKDOWN

Orange County’s Welfare Fraud Early Detection and Prevention Program estimates that it has saved taxpayers more than $173 million since it started in March, 1981. Based on this estimate, the direct tax dollar savings to Orange County is 5.9% of that total or more than $10 million. Federal and state governments share the bulk of the savings.

Program Savings Aid for Dependent Children $144,198,243 Food Stamps 27,166,766 General Relief* 2,249,861 Total** 173,614,870

* Fraud detection did not begin in the General Relief program until 1986.

** Total is from the beginning of the detection program in March, 1981, through June, 1989.

Breakdown of estimated savings by funding source:

Source Amount % of Total Federal $99,265,888 57.1 State 64,312,416 37.0 County 10,036,566 5.9

Source: Orange County welfare fraud early detection unit

FEW LIFELINES: The options for public relief are few in a sea of affluence. Page A1