Summary of LAO Findings and Recommendations on the 2010-11 Budget

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Budget Issue
LAO Finding Or

Last Updated
See Detail  Employment Development Department Workforce Investment Act (WIA) State Discretionary Funds Redirect WIA state discretionary funds to the California State University nursing programs and other employment training programs to create General Fund savings in the low millions. 6-03-10
See Detail  CalWORKs May Revision: Governor's Proposal to Eliminate CalWORKs. Effective October 1, 2010, this proposal would result in net savings of approximately $1.1 billion beyond earlier proposed reductions. Recommend rejection of the Governor's May Revision proposal to eliminate CalWORKs. CalWORKs is a core program with a history dating back to the 1930s, provides significant federal funds relative to its General Fund cost, and prevents substantial cost shifts to county-funded General Assistance (GA) programs. However, once enhanced funding related to the federal stimulus legislation expires, the Legislature may need to make substantial reductions in 2010-11. 5-20-10
See Detail  In-Home Supportive Services In-Home Supportive Services (IHSS) Recipient Fingerprinting Delay the implementation of the requirement to fingerprint IHSS recipients until a second pilot project (or other cost-benefit analysis) is completed. This second pilot would determine whether the savings from fingerprinting recipients is expected to outweigh the cost of implementing this requirement. Adopting this recommendation results in General Fund savings of up to $4 million in 2009-10 and $2 million in 2010-11. 5-10-10
See Detail  Unemployment Insurance Program In order to meet an April 2011 statutory deadline, the Employment Development Department proposes an interim parallel database solution for implementing an alternate base period. Delay the statutory deadline by six months to allow the Employment Development Department (EDD) to continue with its original plan to implement an alternate base period without a risky parallel database. This would still give EDD a full year to complete ABP implementation before the federally imposed deadline of September 2012. 5-10-10
See Detail  Statewide Automated Welfare System (SAWS) The Los Angeles Eligibility, Automated Determination, Evaluation and Reporting (LEADER) system is one of four county welfare consortia. When the legislatively approved migration of 35 counties to Consortia-IV is completed in June 2010, there will be three consortia. For the past two years Los Angeles County and the state Office of Systems Integration have been planning for LEADER's replacement. For 2010-11, the budget proposes $45 million ($23 million General Fund) for LEADER replacement. Consolidate to two consortia in order to reduce system maintenance and support costs and avoid future development and procurement costs for new systems. There are two routes to this goal. The first would be to build the LEADER replacement system while ensuring it is adaptable and scalable so that it could absorb other counties in the future. The second would be to migrate LEADER to the existing C-IV system. Both routes have merit and the Legislature should choose one of these routes. 3-17-10
See Detail  Employment Development Department The Governor proposes to borrow $500 million from the Unemployment Compensation Disability Fund to provide training grants and incentive payments to employers as part of his Jobs Package. Reject the proposal because (1) most of the funding will result in a windfall to businesses that are planning to expand on the natural, (2) over $1 billion in funds for training are already available in the workforce development system, and (3) proposal creates additional borrowing that must be repaid by businesses. 2-23-10
See Detail  In-Home Supportive Services Eliminate IHSS for recipients with functional index scores of less than 4. Although we find that reductions to the IHSS program are possible, in the short term, we recommend that the Legislature focus its work in the special session on developing a better measure of impairment for IHSS recipients. This measure will help the Legislature make IHSS reduction decisions in the future. 2-03-10
See Detail  California Food Assistance Program (CFAP) Eliminate CFAP effective June 1, 2010, resulting in savings of $3.8 million in 2009-10 and $56.2 million in 2010-11. Modify program in order to achieve savings of at least half the level proposed by the Governor. 1-29-10
See Detail  CalWORKs Eliminate CalWORKs services and grants for recent legal noncitizens effective June 1, 2010. This results in savings $0.7 million in 2009-10 and $21.8 million in 2010-11. Make any reduction contingent on the expiration of the Temporary Assistance for Needy Families (TANF) Emergency Contingency Funds (ECF) contingent upon expiration of the ECF. Under current law, the ECF expires on September 30, 2010, but the Governor's budget assumes it is extended until June 30, 2011. 1-29-10
See Detail  CalWORKs Reduce grants by 15.7 percent. Adopt a significant grant reduction on a contingent basis, whereby the cut is only made when the federal Temporary Assistance for Needy Families (TANF) Emergency Contingency Fund (ECF) expires. Expiration of the ECF is set for September 30, 2010 under current law, but the Governor's budget assumes extension through June 30, 2011. 1-29-10
See Detail  Cash Assistance Program for Immigrants (CAPI) Eliminate CAPI effective June 1, 2010, resulting in savings of $8.1 million in 2009-10 and $107.3 million in 2010-11. Modify program in order to achieve savings of at least half the level proposed by the Governor. 1-29-10
See Detail  Foster Care Increased federal eligibility for Foster Care Recommend the Legislature support the Governor's proposal to pursue federal funding for all Foster Care cases. However, as there is no basis to assume federal eligibility changes will occur any time soon, we also recommend the budget not be adjusted to reflect any savings from this proposal. 1-29-10
See Detail  In-Home Supportive Services The In-Home Supportive Services (IHSS) caseload is overbudgeted Recognize General Fund savings of $35 million in 2009-10 because we estimate the IHSS caseload to be overstated by 2.5 percent in the current year. 1-29-10
See Detail  In-Home Supportive Services (IHSS) Reduce state participation in IHSS provider wages Temporarily reduce state participation in provider wages and benefits to $8.60 per hour. The LAO will report to the Legislature if utilization of authorized hours appears to be affected by the reduction in state participation. This is estimated to result in General Fund savings of $57 million in 2009-10 and $651 million in 2010-11. 1-29-10
See Detail  SSI/SSP Reduce monthly grants for SSI/SSP individuals to the federal minimum. Adopt the Governor's proposal to reduce grants to the federal minimum (a reduction of 1.8 percent). This would result in General Fund savings of $14 million in 2009-10 and $178 million in 2010-11. The Legislature should also consider the option to make SSI/SSP recipients eligible for federal food stamps. 1-29-10
See Detail  California Children and Families First Commission Ballot measure to reprioritize Proposition 10 funds Recommend the Legislature adopt the Governor's proposal to ask the voters to prioritize the use of Proposition 10 funds to support core children's programs and services. Moreover, the Legislature may wish to go beyond the Governor’s proposal by considering additional alternatives to (1) redirect additional funding for these purposes; and/or (2) make the temporary redirections of funding permanent. 1-22-10