The 2020-21 Spending Plan

Human Services

CalWORKs/Food Assistance

CalWORKs

The California Work Opportunity and Responsibility to Kids (CalWORKs) program provides cash assistance, child care, and employment services to low-income families with children. The spending plan provides a total of $7.8 billion (all funds) to support the CalWORKs program in 2020‑21, an increase of about $2 billion (36 percent) relative to estimated spending in 2019‑20. The year-over-year increase reflects a projected increase in CalWORKs caseload, as described below. Within the total funding amount, the spending plan provides $2.8 billion from the state General Fund for CalWORKs in 2020‑21, an increase of $1.8 billion (176 percent) relative to 2019‑20. Major changes in CalWORKs funding and policy included in the 2020‑21 spending package are described below.

Projects CalWORKs Caseload to Reach All-Time Highs. Generally speaking, CalWORKs caseload and costs increase during and following economic recessions and decrease during economic expansions. The all-time high for CalWORKs caseload (587,000 cases per month) was reached in 2010‑11 in the wake of the Great Recession. In response to the coronavirus disease 2019 (COVID-19) public health emergency and recession, as part of the May Revision proposal, the administration projected the CalWORKs caseload would increase well above this previous high, averaging about 725,000 cases in 2020‑21 (about twice the caseload projected in the Governor's January budget proposal). The final budget projects a lower CalWORKs caseload—instead equaling the previous all-time high of 587,000 in 2020‑21. Because grant levels are higher now than during the previous recession, total CalWORKs costs are projected to reach a new all-time high of $7.8 billion (as compared to about $6.3 billion in 2010‑11).

Provides $2.4 Billion for CalWORKs Administration and Support Services. The state provides counties with a “single allocation” to cover most costs associated with CalWORKs aside from cash assistance. Counties are free to shift this funding between any of the supported functions, including CalWORKs administration, employment services, and child care. Generally speaking, single allocation funding is adjusted in rough proportion to changes in caseload. As part of the May Revision, however, the administration proposed to increase the single allocation by 24 percent relative to 2019‑20 proposed levels—notably below their projected caseload increase of 76 percent. The administration assumed that new CalWORKs entrants were likely to be only temporarily unemployed due to COVID-19-related lockdowns and would thus require relatively few employment services to promote their employability. Although the spending plan assumes a lower CalWORKs caseload than the May Revision, it holds the single allocation at the same level proposed in the May Revision (about $2.4 billion).

Extends Lifetime Limit on Adults Receiving CalWORKs From 48 Months to 60 Months Starting in May 2022. The 2020‑21 spending plan reverses a notable policy change made during the previous recession. When CalWORKs was first established, adults in the program could participate in the program for a total of 60 months (the maximum allowed for recipients of federal Temporary Assistance for Needy Families, or TANF, funding). Starting in 2011, California reduced this to a 48-month time limit in an effort to reduce program costs. New budget-related legislation extends this time limit back to 60 months starting in May 2022. The administration estimates this policy will cost about $70 million ongoing, although the initial costs in 2022‑23 are estimated to be about twice that large (this is because the policy change retroactively extends eligibility for an estimated 80,000 cases that have already timed out under the 48-month limit with associated limited-term costs).

Increases Flexibility of Work Requirements for Adults Receiving CalWORKs. Although federal law generally requires adults receiving TANF funding to participate in certain work-related activities, California has historically allowed some recipients greater flexibility in selecting work-related activities that suit their individual needs. Starting in 2012, all adults on CalWORKs were allowed to meet the more flexible state standards for up to 24 months while receiving aid. The spending plan extends this flexibility for the adult’s entire time receiving aid (up to 48 months currently, increasing to 60 months in May 2022).

Temporarily Eliminates Funding for CalWORKs Outcomes and Accountability Review (Cal-OAR). Under Cal-OAR, counties are required to develop strategic plans and track specific performance indicators related to CalWORKs over a three-year cycle. Cal-OAR was authorized as part of the 2017‑18 spending plan, with the first three-year cycle intended to begin this year. The administration’s January budget proposal included $20 million in local assistance for counties to develop and implement these plans. The May Revision proposed eliminating this funding on an ongoing basis. The spending plan eliminates this funding for 2020‑21, extends the length of county strategic plans from three to five years, and makes all related county activities optional for 2020‑21.

Delays Intended Ramp Up of CalWORKs Home Visiting Program. The 2018‑19 spending plan created the home visiting program, under which some CalWORKs families with a child under two years old receive regular visits from a nurse, parent educator, or early childhood specialist who works with the family to improve maternal health, parenting skills, and child cognitive development. The administration’s January budget proposal included $117 million for this program, reflecting a $30 million increase over 2019‑20 spending levels consistent with the program’s intended multiyear ramp up. In line with the May Revision proposal, the spending plan removes this $30 million augmentation, leaving program spending flat at $90 million.

Food Assistance

Projects CalFresh Caseload to Reach All-Time Highs. CalFresh (formerly Food Stamps) provides money for food to low-income Californians. Starting in 2019‑20, Supplemental Security Income/State Supplementary Payment recipients were newly eligible to receive CalFresh benefits. Due to this policy change, and a decades-long effort to increase CalFresh enrollment, CalFresh caseload was already at an historic high prior to the COVID-19 public health crisis (about 2.2 million households in February 2020). The public health crisis and consequent recession has resulted in an increased number of CalFresh-eligible households. The administration projects caseload to average nearly 3 million households in 2020‑21.

Temporarily Caps County Match Requirement for CalFresh Administrative Funding. Although CalFresh benefits are completely federally funded, CalFresh administrative costs are split between the federal (50 percent), state (35 percent), and county (15 percent) governments. The spending plan anticipates the CalFresh caseload to increase by more than 50 percent (from 1.9 million in 2019‑20 on average to about 3 million in 2020‑21 on average) in response to the COVID-19 public health emergency and subsequent recession. To alleviate the corresponding pressure on county budgets, the spending plan caps county contributions to CalFresh administration at their 2019‑20 levels, with the state covering the county share for any costs above and beyond those amounts. The administration estimates CalFresh administrative costs will total about $2 billion in 2020‑21, of which $736 million will be state General Fund.

Provides $50 Million to Statewide Network of Food Banks. The Emergency Food Assistance Program (TEFAP) provides about $50 million annually in federal funding to 49 California food banks (serving all 58 counties) to purchase and distribute food to low-income families. The spending plan contributes an additional $50 million to these food banks to address increased demand for nutrition assistance following the COVID-19 public health emergency. This is one of several state and federal actions taken to improve nutrition access for Californians during the public health emergency. (For more information, see our post “Nutrition Programs in COVID-19 Recovery Actions”).

COVID-19 Actions in CalWORKs and CalFresh

Prior to adopting the spending plan, the administration used executive orders and existing budgetary authority to provide notable flexibilities and some funding to the CalWORKs and CalFresh programs in response to COVID-19. These included:

• Suspending (for the months of March, April, and May) the requirement that current recipients complete and counties review redetermination paperwork for CalWORKs and Calfresh every six months.

• Deciding not to count any of the months from March through July against the 48-month lifetime limit on adults receiving CalWORKs assistance.

• Providing a total of $32.3 million to counties to address increased administrative costs for CalWORKs and CalFresh.

• Providing a total of $25 million to California food banks to address increased demand generated by the pandemic and subsequent lockdowns.

• Providing $3 million to increase CalWORKs diversion payments (one-time cash assistance for families who might otherwise qualify for ongoing CalWORKs assistance)

Reiterating the existing ability for counties to approve applicants for CalWORKs and CalFresh using telephonic and/or internet processes.