U.S. Welfare Revision Could Be Costly to L.A.

The sweeping welfare reform package moving toward final congressional action this week could slap Los Angeles county taxpayers with a massive bill--more than $300 million a year--for the care of legal immigrants who would be denied federal benefits, the county’s top administrator warned Sunday.

Aides to President Clinton have suggested he might veto the bill because of its treatment of immigrants, and California’s two senators plan to try Tuesday to amend the legislation to soften the blow. So far, however, congressional Republican leaders have been adamant about ending immigrants’ eligibility for federal benefits--including not only welfare itself, but food stamps, supplementary benefits for the elderly and disabled and health care now paid for by Medi-Cal.

The denial of benefits for immigrants accounts for more than 40% of the cost savings in the pending bill, according to the Congressional Budget Office.

The changes would affect immigrants nationwide--for example, about 1.3 million immigrants, many of them children, would lose Medicaid eligibility. But the impact of the bill would be concentrated in three states, California, New York and Texas, that have the largest numbers of legal immigrants.

The bill would affect only those immigrants who are in the country legally. Illegal immigrants already are ineligible for welfare and other benefit programs. Federal officials estimate that about 40% of the immigrants who now receive benefits live in California. Of those, about half are in Los Angeles County, officials estimate.

If legal immigrants who live in Los Angeles County lose welfare benefits and instead seek general relief payments, the county’s cost for that program of last resort could increase by an estimated $236 million a year, said Acting Chief Administrative Officer Sandra Davis.

In addition, the denial of federal Medicaid dollars for immigrants could saddle the county with an additional $100-million annual bill once the change is fully phased in five years from now.

The added financial burden on the $12-billion county budget would be “a very significant setback,” since the county is now recovering from its worst-ever fiscal crisis, Davis said. “It would be very traumatic for the County of Los Angeles.”

Until recently, the welfare reform bill was little more than the distant noise of politicians hollering at each other in the halls of Congress. But suddenly, for local and state officials, the potential impact of one of the most fundamental changes in federal social welfare policy in six decades has begun to hit home.

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In addition to the impact on immigrants, the current bill--if Clinton signs it into law--would give Gov. Pete Wilson much of the authority he craves to erase the current system that props up California’s needy and redesign it from bottom to top.

Overall, about $13.6 billion a year is spent in California on about 4.6 million people in need. One quarter of what the nation spends on Aid to Families With Dependent Children--the government’s main cash welfare program--is spent in California. About 27% of children in California live below the poverty line, the highest child-poverty rate of any state outside the South.

Under legislation already signed by Wilson, welfare benefits in the state--currently the fourth-highest in the nation--automatically would be cut 4.6% if the proposed federal legislation passes. The reduction would be twice as high in some counties--mostly rural ones--that have comparatively low housing costs.

The most immediate impact of the new bill, however, would be on immigrants.

Republicans insist that the changes they want to make are only fair. “Those we welcome to our country as guests should not abuse the hospitality of hard-working Americans,” Rep. Phil English (R-Pa.) argued in House debate last week.

Democrats, however, argue that the bill’s impact on immigrants is bad policy.

“How can we be proud to vote for a bill that would take a blind, elderly woman with no other means of support and throw her out on the street?” Sen. Barbara Boxer (D-Calif.) asked the Senate. “How can we be proud of a bill that takes children and puts them out on the street?”

In Los Angeles, critics of the bill warn that denying health services to legal immigrants will shift the burden of care to the county, where the health care system nearly collapsed last year from lack of funds. A presidential bailout kept it afloat.

“These people are not going to just disappear,” said Casey McKeever, director of the Western Center on Law and Poverty’s Sacramento office. “There has to be some means of coping with this serious human problem.”

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About 37,000 elderly and disabled people who receive in-home supportive services would be forced into nursing homes, with no money to pay for their care if they are denied Medi-Cal, said Phil Ansell, intergovernmental relations director of Los Angeles County Community and Senior Services.

“These are people who can’t feed themselves, dress themselves, bathe themselves. It would seem they would have no means of survival,” he said.

The governor’s office dismisses such scenarios.

“The governor is not going to put people out on the street,” said Lisa Kalustian, spokeswoman for the California Health and Welfare Agency.

The amendment that Boxer and fellow Democrat Sen. Dianne Feinstein of California plan to offer Tuesday would preserve benefits for immigrants currently in the country but would deny benefits to future immigrants.

“I have a real problem with changing the law in midstream” for people already in the country, Feinstein argues.

Other impacts would depend on how much success Wilson has in using the flexibility that the new law would give him to achieve the welfare changes he has sought. So far, he has had difficulties. Earlier this month, for example, a state Senate committee soundly rejected several of his plans.

“If we are going to give the next generation of Californians a reason to hope and a chance to improve their lives, Congress must resist those who wish to preserve the status quo and send to the president a strong welfare reform package that maximizes, not reduces, the ability of states to demand personal responsibility and accountability,” Wilson argued.

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If the governor has his way, adults considered able-bodied would be cut off from welfare after two years and checks would no longer increase with the size of the family.

The congressional legislation would remove the federal safety net that has for decades guaranteed that needy people receive assistance, replacing it with a block grant given to each state to spend essentially as it sees fit.

And Wilson’s aides argue that fundamental changes are needed. “We have a welfare population stuck in a program designed 40 years ago,” Kalustian said. “Social situations have changed, conditions have changed, states have changed and we have not been in the position to change with any of that.”

Advocates for the poor agree that the current welfare system cries out for reform, but they warn that the proposed legislation and Wilson’s welfare plan are at best counterproductive.

“This legislation masquerades as reform, but it is not that. It is a giant step back into poverty,” said Rep. Henry A. Waxman (D-Los Angeles).

People like Christine Rose are not sure which side to believe. She was a PTA mother married for 12 years with two children, two dogs, two finches and a cat in a middle-class house in Roseville. Then, as she testified to a state legislative committee, her husband was arrested for a white-collar crime.

He went to prison for six years. She went on welfare. Now in college to earn her teaching credentials, she cares for her children, studies until midnight, earns straight A’s, volunteers every other weekend at the local senior center and tries to stretch a $594 monthly check that is almost $300 less than her mortgage used to be.

Getting by is about to get harder. She said she believes that the new legislation will force her to go to school part time and find a minimum-wage job, meaning it will take six years to earn her teaching credentials instead of two.

“I know they think people like me are sitting in front of the TV all day,” she said. “But I am working as hard as I can because I want to make things better for my children, I want to pay taxes, I never want to be in this position again.”

Fiore reported from Washington and Rabin from Los Angeles.