SPEAKERS CONTENTS INSERTS
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PRESIDENT'S FISCAL YEAR 1998 BUDGET
SUBCOMMITTEE ON HUMAN RESOURCES
COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
FEBRUARY 13, 1997
Page 2 PREV PAGE TOP OF DOCPrinted for the use of the Committee on Ways and Means
COMMITTEE ON WAYS AND MEANS
BILL ARCHER, Texas, Chairman
PHILIP M. CRANE, Illinois
BILL THOMAS, California
E. CLAY SHAW, Jr., Florida
NANCY L. JOHNSON, Connecticut
JIM BUNNING, Kentucky
AMO HOUGHTON, New York
WALLY HERGER, California
JIM McCRERY, Louisiana
DAVE CAMP, Michigan
JIM RAMSTAD, Minnesota
JIM NUSSLE, Iowa
SAM JOHNSON, Texas
JENNIFER DUNN, Washington
MAC COLLINS, Georgia
ROB PORTMAN, Ohio
PHILIP S. ENGLISH, Pennsylvania
JOHN ENSIGN, Nevada
JON CHRISTENSEN, Nebraska
WES WATKINS, Oklahoma
J.D. HAYWORTH, Arizona
Page 3 PREV PAGE TOP OF DOCJERRY WELLER, Illinois
KENNY HULSHOF, Missouri
CHARLES B. RANGEL, New York
FORTNEY PETE STARK, California
ROBERT T. MATSUI, California
BARBARA B. KENNELLY, Connecticut
WILLIAM J. COYNE, Pennsylvania
SANDER M. LEVIN, Michigan
BENJAMIN L. CARDIN, Maryland
JIM McDERMOTT, Washington
GERALD D. KLECZKA, Wisconsin
JOHN LEWIS, Georgia
RICHARD E. NEAL, Massachusetts
MICHAEL R. McNULTY, New York
WILLIAM J. JEFFERSON, Louisiana
JOHN S. TANNER, Tennessee
XAVIER BECERRA, California
KAREN L. THURMAN, Florida
A.L. Singleton, Chief of Staff
Janice Mays, Minority Chief Counsel
Subcommittee on Human Resources
E. CLAY SHAW, Jr., Florida, Chairman
DAVE CAMP, Michigan
Page 4 PREV PAGE TOP OF DOCJIM McCRERY, Louisiana
MAC COLLINS, Georgia
PHILIP S. ENGLISH, Pennsylvania
JOHN ENSIGN, Nevada
J.D. HAYWORTH, Arizona
WES WATKINS, Oklahoma
SANDER M. LEVIN, Michigan
FORTNEY PETE STARK, California
ROBERT T. MATSUI, California
WILLIAM J. COYNE, Pennsylvania
JIM McDERMOTT, Washington
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Ways and Means are published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined. The electronic version of the hearing record does not include materials which were not submitted in an electronic format. These materials are kept on file in the official Committee records.
C O N T E N T S
Advisories announcing the hearing
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U.S. Department of Health and Human Services, Hon. Olivia A. Golden, Ph.D., Principal Deputy Assistant Secretary for Children and Families; accompanied by Raymond J. Uhalde, Deputy Assistant Secretary for Employment and Training, U.S. Department of Labor; and Bonnie O'Neil, Associate Deputy Administrator, Food Stamp Program, U.S. Department of Agriculture
Social Security Administration, Hon. Carolyn Colvin, Deputy Commissioner for Programs and Policy
Catholic Charities USA, Sharon M. Daly
Council of Jewish Federations, Diana Aviv
National Fatherhood Initiative, Wade F. Horn
Rector, Robert, Heritage Foundation
Smith, Hon. Lamar, a Representative in Congress from the State of Texas
PRESIDENT'S FISCAL YEAR 1998 BUDGET
THURSDAY, FEBRUARY 13, 1997
House of Representatives,
Committee on Ways and Means,
Page 6 PREV PAGE TOP OF DOCSubcommittee on Human Resources,
The Subcommittee met, pursuant to notice, at 11:37 a.m., in room B318, Rayburn House Office Building, Hon. E. Clay Shaw, Jr. (Chairman of the Subcommittee), presiding.
[The advisories announcing the hearing follow:]
FROM THE COMMITTEE ON WAYS AND MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
CONTACT: (202) 2251025
FOR IMMEDIATE RELEASE
January 31, 1997
Shaw Announces Hearing on
President's Fiscal Year 1998 Budget
Congressman E. Clay Shaw, Jr., (RFL), Chairman, Subcommittee on Human Resources of the Committee on Ways and Means, today announced that the Subcommittee will hold a hearing on President Clinton's fiscal year 1998 budget proposals that are under the jurisdiction of the Subcommittee. The hearing will take place on Thursday, February 13, 1997, in room B318 Rayburn House Office Building, beginning at 11 a.m.
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Oral testimony at this hearing will be heard from invited witnesses only. Witnesses will include Dr. Olivia A. Golden, Acting Assistant Secretary, Administration for Children and Families, Department of Health and Human Services, accompanied by officials from the Health Care Financing Administration, the Social Security Administration, and the Department of Labor. Other public witnesses are expected to attend.
Any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing.
It appears likely that the administration's budget will address several major programs under the jurisdiction of the Subcommittee. These include adoption, welfare (especially benefits for noncitizens), and programs to create jobs for low-income workers.
In announcing the hearing, Chairman Shaw said: ''I am especially interested in the budget initiatives that could impact on the welfare reform bill passed by Congress last year. We want to provide States with the flexibility they need to implement innovative and successful welfare programs. I am looking forward to reviewing the administration's proposals. The Administration will receive a fair hearing on its proposals to ensure that jobs will be available to those leaving welfare.''
FOCUS OF THE HEARING:
Page 8 PREV PAGE TOP OF DOC The primary purpose of the hearing is to provide a forum for the administration to explain and review the rationale for their budget proposals in the human resource area. The Subcommittee will also hear from a group of expert witnesses commenting on the President's budget initiatives.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Any person or organization wishing to submit a written statement for the printed record of the hearing should submit at least six (6) copies of their statement and a 3.5-inch diskette in WordPerfect or ASCII format, with their address and date of hearing noted, by the close of business, Thursday, February 27, 1997, to A.L. Singleton, Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 Longworth House Office Building, Washington, D.C. 20515. If those filing written statements wish to have their statements distributed to the press and interested public at the hearing, they may deliver 200 additional copies for this purpose to the Subcommittee on Human Resources office, room B317 Rayburn House Office Building, at least 1 hour before the hearing begins.
Each statement presented for printing to the Committee by a witness, any written statement or exhibit submitted for the printed record or any written comments in response to a request for written comments must conform to the guidelines listed below. Any statement or exhibit not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.
Page 9 PREV PAGE TOP OF DOC1. All statements and any accompanying exhibits for printing must be typed in single space on legal-size paper and may not exceed a total of 10 pages including attachments. At the same time written statements are submitted to the Committee, witnesses are now requested to submit their statements on a 3.5-inch diskette in WordPerfect or ASCII format.
2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.
3. A witness appearing at a public hearing, or submitting a statement for the record of a public hearing, or submitting written comments in response to a published request for comments by the Committee, must include on his statement or submission a list of all clients, persons, or organizations on whose behalf the witness appears.
4. A supplemental sheet must accompany each statement listing the name, full address, a telephone number where the witness or the designated representative may be reached and a topical outline or summary of the comments and recommendations in the full statement. This supplemental sheet will not be included in the printed record.
The above restrictions and limitations apply only to material being submitted for printing. Statements and exhibits or supplementary material submitted solely for distribution to the Members, the press and the public during the course of a public hearing may be submitted in other forms.
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Note: All Committee advisories and news releases are available on the World Wide Web at 'HTTP://WWW.HOUSE.GOV/WAYSMEANS/'.
The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 2022251721 or 2022251904 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.
NOTICECHANGE IN TIME
FROM THE COMMITTEE ON WAYS AND MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
CONTACT: (202) 2251025
FOR IMMEDIATE RELEASE
February 12, 1997
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Time Change for Subcommittee Hearing on
Thursday, February 13, 1997,
on the President's Fiscal Year 1998 Budget
Congressman E. Clay Shaw, Jr. (RFL), Chairman of the Subcommittee on Human Resources, Committee on Ways and Means, today announced that the Subcommittee hearing on the President's Fiscal Year 1998 Budget previously scheduled for Thursday, February 13, 1997, at 11 a.m., in B318 Rayburn House Office Building, will begin instead at 11:30 a.m.
All other details for the hearing remain the same. (See Subcommittee press release No. HR1, dated January 31, 1997.)
Chairman SHAW. Good morning. We are pleased to be conducting the Subcommittee's first hearing of the 105th Congress on the topic of President Clinton's 1998 budget. I believe the general response to the budget from our side of the aisle has been, ''the President has given us a good start.'' We will make changes, but on the whole, the Clinton budget gets us started in the right direction.
Page 12 PREV PAGE TOP OF DOC Our purpose today is to consider the President's recommendations on human resource programs. For our purpose, these recommendations fall into five categories. The first is his recommendation that we spend an additional $14 billion on welfare for noncitizens. Republicans have presented a united front on this issue, and that front says we are not going to reopen last year's welfare reform bill.
The heart of our immigration policy is that we admit people to this country who come for opportunity. If they need assistance before they become citizens, their sponsors should provide it. Any other policy will result in taxpayers spending billions of dollars on noncitizens who came here seeking opportunity.
The second category of recommendations of interest to this Subcommittee is the President's proposal on the Temporary Assistance for Needy Families Block Grant Program. The major point here is that unlike the reforms on noncitizens, the administration made no recommendations to change the Block Grant Program.
I want to congratulate the administration on its wise decision to keep the welfare block grant intact. I hope we can continue this approach for at least a year or two until we can get a good idea of what the States are doing and whether the programs are having the effects we anticipated.
In that regard, I had a news conference early this morning that showed some remarkable results as to what is going on in the States at this time which should make this Subcommittee very pleased with the bill that we reported out and passed into law last year.
The President has proposed some supplements to the welfare reform bill. Specifically, he calls for a $1 billion expansion of the Work Opportunity Tax Credit and a new $3 billion grant to States and cities to stimulate employment of welfare families. Today's hearing will provide us with an opportunity to hear more about these proposals.
The third category of recommendations we want to examine is the reforms on SSI, Supplemental Security Income, for children. The regulations implementing these reforms were issued last week by the administration. It is our understanding that even though the caseload will continue to grow, about 135,000 children currently on SSI no longer will meet the eligibility standards.
Page 13 PREV PAGE TOP OF DOC I want to congratulate the administration on publishing these regulations. They will serve the goal of ensuring that only the truly disabled children receive SSI benefits, and at the same time clarify the process by which decisions are made on who qualifies for benefits. We have a few questions, but I think the Social Security Administration did a great job of implementing the intent of the law we passed last year.
I also note the President has proposed extending Medicaid coverage to the children who no longer qualify for SSI. I am looking forward to hearing the administration's justification for this policy.
Fourth, the budget contains a brief outline of the administration's intent to propose legislation to promote adoption. We all agree adoption is too rare. I hope we can use today's hearing to explore policies we can adopt at the Federal level that will promote adoption.
Finally, we take strong exception with the President's decision to extend the FUTA surtax and to require the Nation's employers to pay FUTA taxes four times more often than under current law. I will personally do my best to ensure that neither of these proposals become law.
I welcome Dr. Golden and her colleagues who will testify on behalf of the administration, as well as our invited witnesses. Dr. Golden, we have worked very well with HHS since you took over the administration for Children and Families. I compliment you and all your efforts on implementing the welfare bill thus far.
Yesterday, we had a Full Committee hearing. Secretary Shalala testified. I do want to point out, and I think with enthusiasm, that although many of the people over in the administration showed a lot of enthusiasm with regard to the bill that was passed, I think everybody seems to be pulling together now to see what will happen and to make it work, although they disagreed with the direction the Congress went. That is good news, I think, for the poor of this country and people who truly do want to take control of their own futures.
At this time I would yield to my Ranking Member, Mr. Levin.
Page 14 PREV PAGE TOP OF DOC Mr. LEVIN. Thank you, Mr. Chairman. Let me begin by thanking you for scheduling this hearing so promptly on the President's fiscal year 1998 budget proposals. It is appropriate we begin by discussing with the administration their ideas on welfare reform.
Some have worried the administration, or perhaps the Governors, or some of them, might be attempting to reopen welfare reform with the recent budget proposals and the NGA resolution. But nothing is further from the truth. I do not want, Mr. Chairman, to reopen welfare reform. I will resist any effort to change the welfare-to-work provisions in the welfare bill.
What the President is proposing is $3 billion to ensure that when the welfare-to-work provisions are implemented, they do truly work. This is considerably less than the $10 billion proposed by Republicans just a few years ago.
Yesterday, the President and congressional leaders agreed to place the welfare-to-work incentives on the list of five priority initiatives where a consensus is within reach. I am confident, Mr. Chairman, there is plenty of room for bipartisan cooperation in these proposals, because changing welfare from an income support to a work-related system has roots in both parties.
With respect to legal immigrants, these provisions are not related to the thrust of welfare reform, which is to move people from the AFDC system into the work force. When the President signed the legislation and many of us voted for it, we were very clear about this distinction. The President's proposals before us regarding legal immigrants today remain consistent with this important distinction, as do his proposals on food stamps that are not before this Subcommittee.
We have a responsibility to look at the facts of these proposals and of this issue and to avoid hyperbole. We need to be able to obtain clear information on these issues. To do this we will need to hear more from the Governors of this country. A substantial number of them have already expressed concern about the legal immigrant provisions under the jurisdiction of this Subcommittee, and about the food stamp provisions which are not.
Page 15 PREV PAGE TOP OF DOC The Governors have a responsibility now to play an active role in these discussions. They need to give us their insight on the individuals impacted in their Stateand I understand the Governor of Florida has already sent a letter to this effectthe availability of State programs to replace Federal programs, and the resources available as we move from an entitlement to a Block Grant Program relating to AFDC.
I am confident, Mr. Chairman, we can dig into this issue and discuss the real faces behind the numbers in a cooperative spirit. I would ask the witnesses before us today to remember that notices are now being sent out to 500,000 individual legal immigrants. We need to fully understand the appropriate response of this Congress to these individuals.
Individuals like Young Lee, a 79-year-old South Korean woman who was sponsored as a legal immigrant by her daughter 11 years ago. Her daughter has since died and Lee is beset with medical problems and has no place to turn. Individuals like the gentleman I met in Michigan several weeks ago from the former Soviet Union; a man who fought the Nazis on our side in the war and came to this country as a refugee. He is now in his eighties, suffering the long-term impact of his age and his war injuries with no family or sponsor to turn to. He would lose SSI and food stamps.
Mr. Chairman, I look forward to rolling up our sleeves and working with you, with the administration, and with the Governors as we dig into these issues and seek their appropriate resolution.
Chairman SHAW. Thank you, Sandy. Our first witness this morning is Lamar Smith, who is the Chairman of the Judiciary Immigration Subcommittee. Welcome.
STATEMENT OF HON. LAMAR SMITH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS
Page 16 PREV PAGE TOP OF DOC Mr. SMITH. Mr. Chairman, thank you, and I thank the other Members of the Subcommittee as well for this opportunity to testify before you.
The goal of welfare reform has been to end a system that hurts people. No one can argue with a straight face that welfare has been good to recipients, immigrant or native born, who have become trapped in a web of government dependency for generations.
Last year we responded to the wishes of the American people and put an end to the widespread use and abuse of our welfare system by noncitizens. The welfare and immigration reforms reinforced a century-old law, that immigrants must be self-sufficient and not a financial burden to the country that invited them in. In fact, since 1882, an alien likely to become a public charge has been subject to exclusion from the United States.
Now the President wants to disregard this long precedent and, as you have said, Mr. Chairman, replace it with a policy that ''raises taxes so he can increase welfare spending for people who are not American citizens.''
Specifically, the President's budget proposal would take at least $10 billion from the American taxpayers to give benefits to noncitizens with family members who in almost all instances have promised to take care of them. The taxpayers who are being asked to pick up the tab should know the median income for immigrant families with at least one member receiving SSI and with outside earnings is $38,000. And they should know that one of the most disturbing trends of the eighties and nineties was the explosive growth in welfare use by immigrants. The number of noncitizens on SSI increased by 580 percent between 1982 and 1994.
It once was accepted wisdom that noncitizens used welfare less often than citizens. But new research by Professor George Borjas of Harvard University has revealed a noncitizen household is now 50 percent more likely to receive some form of welfare than a citizen household.
Before last year's welfare and immigration reform bills were enacted, the cost of providing welfare to noncitizens had reached $26 billion a year. And the future looked even bleaker. Robert Rector of the Heritage Foundation estimated that by the year 2004, the cost of SSI and Medicaid for noncitizens alone would reach $67 billion.
Page 17 PREV PAGE TOP OF DOC If immigrants cannot provide for themselves and are not yet eligible to become citizens, there is no need and no precedent to look first to the taxpayers to provide for them. In most cases, immigrants gain admission to the United States through a family member who is already here. That family member, the sponsor, signed an affidavit of support promising to provide for the immigrant's needs when the immigrant could not. Immigrants, who were never supposed to receive public benefits, should turn to their sponsors, their families, for support.
If an immigrant suffers a disabling injury, the question to ask is not, Why should the sponsor be liable, but Why should the taxpayer be liable? The sponsor has made a promise to support the immigrant, in good times and bad. The risk the immigrant may not be able to support him or herself is a risk the sponsor takes on. I find it regrettable the President has proposed that sponsors be let off the hook for the expenses the government incurs in caring for the immigrants they sponsor.
Immigrants should not be allowed to set aside the condition of their entry into the United States that they not become public charges. And family members who are sponsors should fulfill their obligations of sponsorship. America is getting tough on deadbeat parents who refuse to pay child support. The same standard should apply to deadbeat sponsors.
America is poised to transform welfare handouts that have hurt people into handups that will encourage opportunity instead of dependency. Let us not abandon this goal.
Again, Mr. Chairman and Members of the Subcommittee, thank you for the opportunity to be here.
Chairman SHAW. Thank you, Mr. Smith. Do any of the Members on either side have any questions for Mr. Smith?
Mr. LEVIN. Welcome. Let me ask you one specific question, and thank you very much for coming. The reference to $38,000, Do you know what the source of that figure is?
Page 18 PREV PAGE TOP OF DOC Mr. SMITH. I can get you the source in 1 second. We will provide that to you. Let me respond to any other questions you might have.
Mr. LEVIN. Because the information I have seen from the Census Bureau indicatesthis is for a household receiving SSIfor citizens it is $19,400, for noncitizens it is $22,600.
Mr. SMITH. The source for the $38,000 figure is a study conducted by Stanford University economist Thomas McCurdy, and I will give you that study as soon as I leave.
Mr. LEVIN. It is a nationwide survey?
Mr. SMITH. That is my understanding. The median income was $38,052 according to this study.
Mr. LEVIN. I would appreciate if you would supply that to the Subcommittee, and also if you would take a look at the U.S. Census Bureau data.
Mr. SMITH. Sure.
[The following was subsequently received:]
INSERT OFFSET FOLIO 26 HERE
[The official Committee record contains additional material here.]
Mr. LEVIN. Second, you talk about the legal immigrants with sponsors. Do you know more or less what percentage of the legal immigrants receiving SSI are refugees or asylees?
Mr. SMITH. Good question. I do not know exactly what that percentage is. A large number of recipients are in fact refugees and asylees, but I do not know what that percentage is.
Mr. LEVIN. They do not have any sponsors.
Mr. SMITH. Right.
Mr. LEVIN. And in many cases they do not have any family. What is the import of your testimony for those people, most of them in their seventies and eighties?
Page 19 PREV PAGE TOP OF DOC Mr. SMITH. In the case of refugees or asylees, or in the case, for instance, of the two individuals whom you just mentioned in your testimony, in many instances they have been in the country for more than 5 years5 years being the requisite number required in order to apply for citizenship. So the assumption here is there is a distinction between citizens and noncitizens. And if one wants to enjoy the rights, privileges, and benefits of being a citizen, one needs to give up loyalty or allegiance to another country to enjoy those benefits. In those instances, the individuals could apply for citizenship and thereby be entitled to receive the various benefits we are talking about.
Mr. LEVIN. What if they are 75 or 80 and they cannot pass the language requirements?
Mr. SMITH. There are certain exemptions in the law. For instance, if you are over the age of, I think, 50 and have been in the country so many years, an exemption is granted to those individuals.
Let me say though that I have witnessed the citizenship exams and I have gathered statistics from the INS, and you may know that up to 95 percent of the individuals who take these exams pass, depending on the test-giving organization. There is no limit to the number of times one can take these exams. And when I have asked the INS at a hearing if they can tell me anyone who has never, ever passed, having tried multiple times, they could not come up with anybody. So the standards are not particularly strict, and I think most people can easily pass them.
Mr. LEVIN. Let me just ask you then, someone who is on SSIand I do not want to spend all the time on asylees and refugeesbut who is 70, 75 years, who has been here too short a time to have the English language requirement waived, who is very ill, without family, what would your answer be to that?
Mr. SMITH. First of all, I would point out that you are talking about a very, very narrow sliver of individuals. My response would be, Those individuals are not denied benefits that they might receive from community organizations, that they might receive from churches and other kinds of charitable organizations. But my real answer would be sort of a question back. We could perhaps discuss that narrow sliver if we were really serious about the other 98 percent, and making sure and enforcing their moral obligation to be taken care of by the family sponsors that have promised to do so.
Page 20 PREV PAGE TOP OF DOC Mr. LEVIN. Let us do that. I do not think it is a narrow sliver. The refugees and asylees represent between 20 and 25 percent of the people
Mr. SMITH. The sliver I was referring to, Mr. Levin, was the sliver as you described it; those who are over a certain age, who are disabled, who could not take the citizenship exam, and so forth.
Mr. LEVIN. What is the position of your Governor on the President's request on legal immigrants?
Mr. SMITH. I have discussed this with our Governor, who is George Bush of Texas, and he would like to see us not change the welfare law in this regard. But he would hope we could do something for that narrow sliver. I do not want to put words in his mouth but he would, I think, echo what I just said, that if we are going to talk about that, let us talk about the 98 percent and make sure the sponsors are financially responsible for the people they promised to do
Mr. LEVIN. So you are saying he opposes the President's proposals regarding legal immigrants, the Governor of your State?
Mr. SMITH. I know he has not taken a public stand on that that I am aware of. At least that is what he has told me. You would have to check with him to see whether he opposes what the President has proposed.
Chairman SHAW. It is dangerous ground when you start
Mr. SMITH. Excuse me?
Chairman SHAW. You get on thin ice when you start predicting what somebody's stand is going to be.
I would like to just point out a couple of things, Sandy. The States have an option as to whether or not to provide Medicaid assistance to noncitizens. So we have not slammed the door. We have simply made that a State option. So your elderly person would be a question of the States, but of course we know that is a sharing program.
Page 21 PREV PAGE TOP OF DOC In the SSI Program, of the noncitizens, approximately one-sixth of them are refugees. It is also interesting to noteand this is a very disturbing statisticof the elderly in SSI, 51 percent are noncitizens. Fifty-one percent of the elderly on SSI are not citizens of this country.
Does any other Member have any questions of Mr. Smith?
Mr. LEVIN. Let me just mention regarding Medicaid, about $5 billion, I think, of the President's proposal relates to Medicaid. This is one reason I think we need to look at the data and not reach premature conclusions, because I think unless that money is there, many States will not be able to extend the Medicaid Program. We have been trying to understand the dynamics of the $5 billion, but I think that is correct.
That is why our Subcommittee needs to take a look at this issue, including the last statistic that you mentioned about legal immigrants whoabout the number of people on SSI who are legal immigrants. Also, we need to look at the sponsorship, and also, I think, talk to our Governors, because it is my understanding your Governor does not favor only a sliver of legal immigrants being covered as proposed by the President.
Mr. SMITH. I do know he favors enforcing the sponsorship provisions that are in
Mr. LEVIN. To do what?
Mr. SMITH I do know he favors enforcing the sponsorship provisions, where you have a family member who has signed an affidavit saying they would be financially responsible for that individual.
Mr. LEVIN. We are going to do that under the new law.
Mr. SMITH. We hope to; that is correct.
Mr. LEVIN. Thank you.
Chairman SHAW. Mr. Smith, thank you, very much.
Page 22 PREV PAGE TOP OF DOC Mr. SMITH. Thank you, Mr. Chairman.
Chairman SHAW. We appreciate the good work you have done in immigration, and we appreciate your coming before the Subcommittee this morning.
Now, Dr. Golden, if you would take your seat at the witness table and introduce your colleagues that will be seated with you. We thank you for coming here. Dr. Golden is the Acting Assistant Secretary for Children and Families at the U.S. Department of Health and Human Services.
STATEMENT OF HON. OLIVIA A. GOLDEN, PH.D., PRINCIPAL DEPUTY ASSISTANT SECRETARY FOR CHILDREN AND FAMILIES, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES; ACCOMPANIED BY RAYMOND J. UHALDE, DEPUTY ASSISTANT SECRETARY FOR EMPLOYMENT AND TRAINING, U.S. DEPARTMENT OF LABOR; AND BONNIE O'NEIL, ASSOCIATE DEPUTY ADMINISTRATOR, FOOD STAMP PROGRAM, U.S. DEPARTMENT OF AGRICULTURE
Ms. GOLDEN. Thank you, Chairman Shaw. Thank you for your kind remarks. I have longer written testimony and I will briefly summarize it.
Chairman SHAW. It will be made part of the record.
Ms. GOLDEN. Thank you. Chairman Shaw, and Members of the Subcommittee, I am delighted
Chairman SHAW. Would you introduce your colleagues, please?
Ms. GOLDEN. Yes. Carolyn Colvin from the Social Security Administration will be providing testimony on the administration's budget proposals related to Supplemental Security Income, and Ray Uhalde, Deputy Assistant Secretary for Employment and Training of the Department of Labor will respond to the Subcommittee's questions about welfare-to-work. I would also like to introduce Dennis Hayashi, who is leading the Department's efforts on immigration. Given the breadth of the administration's immigrant proposals, I have asked him to accompany me.
Page 23 PREV PAGE TOP OF DOC Chairman Shaw, and Members of the Subcommittee, I am delighted to be here today to discuss two important initiatives from the President's budget that you have identified as being of particular interest: the Presidential initiatives on adoption and welfare-to-work. I would also like to briefly discuss the administration's proposals addressing Medicaid benefits for qualified aliens. Carolyn Colvin will be providing testimony on the administration's budget proposals for making changes affecting Supplemental Security Income eligibility for noncitizens.
First, however, I would like to touch on our progress in implementing welfare reform. I believe it is the cornerstone to realizing our key goals of work, responsibility, and protecting children.
The Administration for Children and Families is responsible for administering several of the programs most affected by the welfare reform legislation, including the new Temporary Assistance for Needy Families, or TANF, Program, the child care programs for families on welfare and other low-income working families, and the Child Support Enforcement Program. States and the Federal Government alike are promptly implementing each of these major pieces of the act, and we are encouraged by the early progress being made.
So far, we have received 42 TANF plans from States, territories, and tribes and 35 of these have been certified as complete. Many State legislatures have begun their sessions and will be addressing the TANF plans, and we expect new plans from the remaining States before the July 1, 1997, implementation deadline.
As part of the development of TANF policy and guidance, we continue to consult with a wide audience to ensure a broad range of perspectives are considered. During these meetings we have heard, for example, about the critical importance of child care in moving families from welfare-to-work, and we have moved quickly to implement the child care program changes which became effective October 1, 1996.
We are also making good progress in implementing the child support provisions of the law. A number of States have already implemented key provisions, including license revocation programs and reporting of new hires. At the Federal level, we are forging ahead to implement the expanded Federal Parent Locator Service, and we anticipate meeting the statutory deadline.
Page 24 PREV PAGE TOP OF DOC I will now turn to the items from the President's budget that are the focus of your invitation: the adoption and welfare-to-work initiatives.
In his radio address to the Nation on December 14, the President set an ambitious national goal: to double, by the year 2002, the number of children from the foster care system who are adopted or permanently placed each year. To achieve this, he has asked us to work with States to set numerical targets, to provide technical assistance to help States in their efforts, and to recognize and reward States for their success with financial incentives.
With respect to the latter, we will propose providing, beginning in fiscal year 1999, a per-child financial incentive to States for increases in the number of children adopted from the public child welfare system. As we envision it, the incentive structure would result in no net cost because increased adoptions from the public system would reduce foster care costs.
The President's fiscal year 1998 budget has requested $10 million to provide technical assistance to the States as they strive to find more children loving and permanent homes. The President has requested an additional $10 million also to provide funding to States to identify barriers to permanency and develop targeted strategies to find permanent homes for children who have been in foster care a particularly long time. Finally, he has requested $1 million for the Department of Health and Human Services to embark on a public awareness campaign to highlight the benefits of adoption and increase the number of adoptive families.
Currently, 100,000 of the 450,000 American children in foster care will not be able to return home. Yet, in 1995, only 20,000 children were adopted; another 7,000 children were placed in permanent guardianships. To change this situation, States and communities all over the country are implementing innovative techniques, as we learned when we consulted with hundreds of State, county, and tribal leaders, foster care and adoption professionals, judges, foundations, and intergovernmental organizations.
The recent congressional actions on adoption, leadership from this Subcommittee and from others, the President's initiative, and the willingness to work together at all levels of government all make our efforts to address these issues more achievable. We look forward to working with the Congress to realize these goals for children.
Page 25 PREV PAGE TOP OF DOC The other area of the President's budget you raised is the welfare-to-work initiative. The enactment of the Personal Responsibility and Work Opportunity Reconciliation Act makes a dramatic and fundamental shift from a welfare system that too often fostered dependence to a new system that promotes independence and work. We urge Congress to join with the administration in enacting two critical additions in the President's fiscal year 1998 budget: an enhanced Work Opportunity Tax Credit and the Welfare-To-Work Jobs Challenge.
The first addition would greatly enhance and target the Work Opportunity Tax Credit. The second, the Welfare-To-Work Jobs Challenge, is designed to help States and cities move 1 million of the hardest to employ welfare recipients into lasting jobs by the year 2000. It provides $3 billion over 3 years in mandatory financing through the Department of Labor for job placement and job creation.
Finally, another major focus for the administration is to change parts of the welfare reform law that have nothing to do with welfare reform. When the President signed the welfare reform bill, he made clear his disappointment with the harsh benefits to immigrants provisions in the bill. The President's fiscal year 1998 budget makes good on his promise to correct those provisions. We are pleased the Governors, in an NGA resolution several weeks ago, agreed that we must not balance the budget on the backs of States or legal immigrants.
The budget proposes to make legal immigrants who become disabled after entering the United States eligible for SSI and Medicaid. The budget also would provide poor immigrant children the same Medicaid health care coverage low-income citizen children receive. These children are permanent members of our Nation, and it is in our self-interest to provide them with the same quality of health care as other children. In addition, the budget would lengthen the 5-year exemption for refugees from the ban to 7 years in order to give them a more appropriate amount of time to naturalize.
In closing, I look forward to our continued work together as we seek to realize the goals of independence for every family, and safety, permanence, and well-being for every child.
Page 26 PREV PAGE TOP OF DOC Thank you.
[The prepared statement follows:]
Statement of Hon. Olivia A. Golden, Ph.D., Principal Deputy Assistant Secretary for Children and Families, U.S. Department of Health and Human Services
Members of the Subcommittee, I am pleased to appear before this Subcommittee today to discuss two important initiatives from the President's budget that you have identified as being of particular interestthe President's initiatives on adoption and welfare to work. I would also like to briefly discuss the Administration's proposals addressing Medicaid and Food Stamp benefits for qualified aliens, so that you have a complete picture of the President's efforts to restore fairness to the Federal safety net programs.
My testimony will focus primarily on the adoption initiative. Carolyn Colvin, from the Social Security Administration will also be providing testimony on the Administration's budget proposals for making changes in the welfare reform provisions affecting Supplemental Security Income (SSI) eligibility for noncitizens. Given the breadth of the Administrations's immigrant proposals, I have asked Dennis Hayashi, who is leading the Department's efforts on immigration issues to accompany me. Also at the table with me is Ray Uhalde, Deputy Assistant Secretary for Employment and Training in the Department of Labor, who will respond to your questions about Welfare-to-Work.
The President's budget for FY 1998 addresses the needs of children and families in multiple ways that we believe will strengthen families, move people from welfare to work and increase self-sufficiency. The areas you have identified for this hearing are certainly important to this mission. The Welfare-to-Work initiative reaffirms and strengthens the work commitment of last year's landmark welfare reform legislation and responds to what the President cites as ''our moral obligation, to make sure that people who now must work can work.'' The adoption initiative focuses special attention on the needs of some of our most vulnerable citizenschildren languishing in foster carewho deserve safe and permanent families. I will address each initiative in a few moments.
Page 27 PREV PAGE TOP OF DOC First, however, I would like to touch on our progress in implementing welfare reform. I believe it is the cornerstone to realizing our key goals of work, responsibility and protecting children.
I will close my testimony by briefly addressing problems in the welfare reform legislation that are harmful to immigrants and that have nothing to do with promoting the welfare reform goals of moving people from welfare to work. The President's budget proposes to continue to provide SSI and Medicaid to vulnerable categories of legal immigrants, especially children and those who become disabled after entry. As the President said in his State of the Union address with respect to his proposed strategy to address these problems, ''To do otherwise is simply unworthy of a great nation of immigrants.''
WELFARE REFORM IMPLEMENTATION
The Administration for Children and Families is responsible for administering several of the programs most affected by the welfare reform legislation, including the new Temporary Assistance for Needy Families (TANF) program, child care programs for families on welfare and other low-income working families, and the child support enforcement program. States and the Federal government alike are promptly implementing each of these major pieces of the Act and we are encouraged by the early progress being made.
So far, we have received 42 TANF plans from States, territories, and tribes and 35 have been certified as complete. Many State legislatures are just now coming into session and will be addressing the TANF plans, and we expect new plans from the remaining States and amendments to plans already submitted before the July 1, 1997 implementation deadline.
Welfare reform provides States with great flexibility to ensure that welfare is a transitional system, rather than a way of life. Along with this new authority and flexibility, the new statute holds States more accountable for program performance. It includes a variety of provisions designed to ensure that States are moving people from welfare to work: penalties, performance-based funding, data collection and reporting, and research and evaluation.
Page 28 PREV PAGE TOP OF DOC On January 31, 1997, because of many States' requests for clarifications, we issued preliminary guidance concerning several issues of immediate concern, most notably the definition of which State expenditures count toward maintenance-of-effort. The guidance also addresses the definitions of ''assistance,'' a key term in determining which expenditures are covered by certain rules, and ''eligible families,'' a key term in determining which State resources count as maintenance-of-effort.
The Clinton Administration is committed to an effective implementation of this historic welfare reform law that transforms the welfare system into one with tough work requirements. We have a great deal of confidence in the States, and we believe that they will use the flexibility in the law to strengthen the focus on work. We will collect all the information we can on how the States are using their dollars and we will take all the administrative actions in our power to ensure that State policies focus on work. We will also work with you and the Governors in a bipartisan fashion to ensure that each State's overall work effort meets the statute's work participation requirements. Specifically, we will seek statutory language making it clear that the calculation of whether a State has met the applicable participation rate shall take into account the State's success in placing participants in both TANF and maintenance of effort programs' work activities. In addition, we will work with the States and Congress to develop legislation, if necessary, to ensure that State flexibility in maintenance of effort programs does not result in costs to the Federal Government due to the potential loss of child support collections.
As part of the development of TANF policy and guidance, we have met and continue to meet with State and local administrators and legislators and their national representatives. We also have met with advocates, and representatives of non-profit organizations and foundations, organized labor, and business organizations. These consultations have helped us to identify issues, such as the one described above, and to ensure that a wide range of perspectives are considered in the development of policy.
Page 29 PREV PAGE TOP OF DOC During these meetings we have also heard about the critical importance of child care in enabling people to move from welfare to work. We were pleased that the new law provided a substantial increase in child care funding and increased flexibility for States to design an integrated child care system to serve both families on welfare and low-income working families. We refer to the newly integrated system as the Child Care and Development Fund (CCDF). ACF moved quickly to implement the child care program changes, which became effective October 1, 1996.
Our Child Care Bureau has taken a number of steps to inform prospective grantees and other interested parties about the CCDF and to ensure the earliest possible flow of the new funds in order to provide continuity between the old and new programs. We issued new mandatory and matching funds as soon as they became available and published early policy guidance requested by States. We have held consultations with grantees and other organizations. We now are developing regulations, financial reporting forms, and other data collection forms. We also are planning for the FY 1998 grant cycle, for which States and tribes will submit applications by July 1, 1997.
We are also proud of the progress States have made in child support enforcement. In 1996, we collected a record of almost $12 billion in child support payments, and the comprehensive provisions in the welfare law are projected to increase child support collections by an additional $24 billion over 10 years.
Implementation of many of these new provisions will require the enactment of State laws. Effective dates of the new requirements vary, but typically fall within 1 to 2 years of enactment. Therefore, full implementation of the child support provisions will take place over time.
Nevertheless, many States already have implemented some of the new federal requirements. For example, in 1995 the President urged all States to implement license revocation programs. Today 43 States have done so. In addition, 35 States recently have enacted the Uniform Interstate Family Support Act, and 26 States have adopted some form of reporting new hires.
Page 30 PREV PAGE TOP OF DOC At the federal level, we have made great progress in making the expanded Federal Parent Locator Service (FPLS) a reality and we anticipate meeting the statutory deadline. Since the enactment of welfare reform, we have entered into contracts with several nationally recognized and respected vendors to help us design and develop the expanded FPLS, manage the project and enhance our quality assurance efforts, and assist us with providing training and technical assistance.
The Federal Office of Child Support Enforcement is also providing technical assistance to States in implementing the other child support provisions in welfare reform. We are conducting broad consultation and outreach to program stakeholders to ensure that the promise of the legislationa strong child support enforcement programis realized.
With respect to the reforms affecting each of these programs, the Administration for Children and Families is committed to working closely with the Congress, the States and localities to ensure that families receive the supports and encouragement they need to move forward with their lives, to engage in work, and to support and nurture their children. I will now turn to the items from the President's budget that are the focus of your invitationthe adoption and Welfare-to-Work initiatives.
THE ADOPTION INITIATIVE
In his radio address to the nation on December 14th, the President set an ambitious national goal: to double, by the year 2002, the number of children from the foster care system who are adopted or permanently placed annually.
In his directive to HHS on adoption, the President asked us to work with States to set numerical targets to benchmark improvement, provide technical assistance to help States in their efforts, and recognize and reward States for their success with financial incentives. With respect to the latter, we will propose providing, beginning in FY 1999, a per child financial incentive to States for increases in the number of children adopted from the public child welfare system. As we envision it, the incentive structure would result in no net cost, since increased adoptions from the public system would reduce foster care costs. This approach represents another step toward focusing on outcomes for children and families in evaluating the effectiveness of our programs.
Page 31 PREV PAGE TOP OF DOC The President's FY 1998 budget has requested $10 million to provide technical assistance to the States as they strive to find more children loving and permanent homes. The President has requested an additional $10 million to provide funding to States to identify barriers to permanency and develop targeted strategies to find permanent homes for children who have been in foster care a particularly long time. Finally, he has requested $1 million for the Department of Health and Human Services to embark on a public awareness campaign to highlight the benefits of adoption and increase the number of adoptive families.
We are strengthening our efforts on adoption because of a growing consensus that we must engage in a more concerted effort to move children to adoption or another permanent family arrangement when they are unable to return home. We know that some children are in foster care far too long awaiting adoption. Last winter, I visited the White House with a teenager who had been in several foster placements over the course of many years. She described the longing that she felt to have a family of her own, but her hopes were fading as she got older and no family could be found. I am pleased to report that this young woman was adopted last year, partially as a result of the attention that her plight received. However, she represents thousands of other children in the public child welfare system who still face multiple barriers to permanence.
Currently, 100,000 of the 450,000 American children in foster care will not be able to return home. Yet, in 1995, only 20,000 children were adopted; another 7,000 children were placed in permanent guardianships. There are multiple barriers to permanence for children in foster care which include a system overwhelmed with serious cases, procedural delays in agencies and the courts and a dearth of potential adoptive families. Underlying and compounding these barriers is the complexity and gravity of the placement decisions that must be made for each child and family in crisis. The President emphasized in his directive that placing children in nurturing families is a responsibility that requires a commitment from Federal, State, and local governments, as well as community, business, and religious groups.
Page 32 PREV PAGE TOP OF DOC States and communities all over the country are implementing innovative techniques, as we learned when we consulted with hundreds of State, county, and tribal leaders, foster care and adoption professionals, judges, foundations, and intergovernmental organizations in developing our report to the President. They have asked us to explore further with them innovative practices like concurrent planning for children in care, family mediation, and voluntary relinquishment counseling for parents.
We will build on this momentum and continue to look for ways to
reduce barriers to permanency in Federal law and regulations through bipartisan collaborative efforts
shorten the time required to move children to permanence
reduce procedural barriers and promote practices that move children to permanency more quickly by examining a number of policy issues, such as reasonable efforts to ensure permanency and policies on timing and purpose of dispositional hearings.
The recent Congressional actions, the President's initiative, the willingness to work together at all levels of government and innovations in the field make our goals more achievable. We look forward to working with the Congress to realize these goals for children.
The enactment of PRWORA makes a dramatic and fundamental shift from a welfare system that too often fostered dependence to a new system that promotes independence and work. To realize the full potential of this new law, welfare recipients must take on major new responsibilities to prepare for and accept work. States and cities must exercise the flexibility provided to undertake new and innovative approaches to preparing recipients for self-sufficiency and work. Private businesses, religious organizations and community groups must join in the President's challenge to create jobs for those hardest to place. In addition, we urge Congress to join with the Administration in enacting two critical additionsan enhanced Work Opportunity Tax Credit and the Welfare to Work Jobs Challenge.
Page 33 PREV PAGE TOP OF DOC The President recently suggested that communities should use ''employment councils'' like the one in Kansas City to help in meeting the requirements of welfare reform. Under the Job Training Partnership Act, 640 similar councils in place across the country engage over 10,000 private sector volunteers in overseeing the training and placement into jobs of welfare recipients, other low income adults and youth, as well as dislocated workers. We anticipate that States and communities will actively engage these councils in meeting the Welfare to Work Jobs Challenge.
These elements provide the tools for an effective welfare to work strategy and help us make the promise of welfare reform real. This Administration is dedicated to the realization of that promise. The President's FY 1998 budget would greatly enhance and target the Work Opportunity Tax Credit to provide powerful, new private-sector financial incentives to employers to create jobs for long-term welfare recipients. The enhanced Work Opportunity Tax Credit would allow employers to claim a 50-percent credit on the first $10,000 a year of wages, for up to two years, for workers that they hire who were long-term welfare recipients. In addition, the President proposes to expand the existing tax Work Opportunity Tax Credit to include able-bodied childless adults aged 18 to 50, who, under the Administration's Food Stamp proposal, would face a more rigorous work requirement in order to continue to receive Food Stamps.
The Welfare to Work Jobs Challenge proposed by the President is designed to help States and cities move a million of the hardest-to-employ welfare recipients into lasting jobs by the year 2000. It provides $3 billion over 3 years in mandatory financing through the Department of Labor for job placement and job creation. States and cities can use these funds to provide subsidies and other incentives to encourage private business to hire welfare recipients.
It is now widely recognized that a more targeted job placement and creation measure is needed to complement the TANF Block Grant if we are to make welfare reform work. The Jobs Challenge is intended to meet this need. We look forward to working closely with the Congress in exploring ways to assist States and localities in helping welfare recipients who can't find jobs on their own transition from welfare into real private sector jobs.
Page 34 PREV PAGE TOP OF DOC Another major focus for the Administration is to change parts of the welfare reform law that have nothing to do with welfare reform. When the President signed the Welfare Reform bill he made clear his disappointment with the harsh benefits to immigrants provisions in the bill. The President stated: ''My Administration supports holding sponsors who bring immigrants into this country more responsible for their well-being. Legal immigrants and their children, however, should not be penalized if they become disabled and require medical assistance through no fault of their own.''
The President's FY 1998 budget makes good on this promise to correct provisions that were included to save money, and which burden States and punish children and the disabled. We are pleased that the governors, in an NGA resolution several weeks ago, agreedwe must not balance the budget on the backs of States or legal immigrants.
Today, you will also be hearing from the Social Security Administration about this key Administration proposal. I would also like to make a few points about why this action is so important.
The welfare law denies most legal immigrants access to fundamental safety net programs unless they become citizenseven though they are in the U.S. legally, are working and paying taxes and are responsible members of our communities. The Administration has always supported making individuals who encourage their relatives to emigrate to the United States more responsible for the immigrants well-being. However, as a nation, we should not turn our backs on anyone who has lost their ability to earn a living due to injury, disease or illness. The nation should protect legal immigrants and their familieswhen they suffer accidents or illnesses that prevent them from earning a living. Consequently, the budget proposes to make legal immigrants who become disabled after entering the United States eligible for SSI and Medicaid. This proposal would allow 320,000 legal immigrants to receive SSI and Medicaid benefits.
The budget would also provide poor immigrant children the same Medicaid health care coverage low income citizen children receive. These children are permanent members of our nation and it is in our self interest to provide them with the same quality of health care as other children.
Page 35 PREV PAGE TOP OF DOC The budget would lengthen the five year exemption for refugees from the ban to seven years in order to give them a more appropriate amount of time to naturalize. The United States admits refugees and asylees into this country on a humanitarian basis. It is a matter of simple decency to provide assistance to this population while they adjust to their new circumstances.
In addition, the Administration is proposing to delay the prohibition against legal immigrants receiving Food Stamps. The Administration proposes to delay the ban on Food Stamps for legal immigrants until the end of FY 1997 in order to give legal immigrant families, elderly and disabled more time to naturalize.
In closing, I would like once again to thank you for your support on behalf of children living in poverty and children in our nation's child welfare system. I look forward to our continued work together as we seek to realize the goals of independence for every family and safety, permanence, and well-being for every child.
My colleagues and I would be happy to answer any questions you have at this time.
Chairman SHAW. Thank you. Before we go to the next witness, let me correct something I said a moment ago. That is when I said that 51 percent of the people in SSI are noncitizens. That is incorrect. It is 51 percent of the spending in SSI is for noncitizens. That figure we got from the administration. That is just the elderly population. So 51 percent is correct, but that is for spending, not an actual body count.
Mr. LEVIN. Mr. Chairman, just so the record is clear, if you will yield just for 30 seconds. I think that figure, and we may talk about it with the next panel, relates to those who are on SSI as elderly, not those who are on with disability.
Page 36 PREV PAGE TOP OF DOC Chairman SHAW. That is correct.
Mr. LEVIN. When you put the two together, the number of noncitizens is far less than 51
Chairman SHAW. Yes, but it showsand I think it is very vividit shows how the immigrants are coming here and using the United States as a retirement home.
Dr. Golden, excuse me, but I wanted to correct my earlier statement.
Ms. GOLDEN. Congressman, the administration's proposal is to restore the benefits for children and immigrants disabled after entry; those two areas.
Chairman SHAW. Ms. Colvin.
STATEMENT OF HON. CAROLYN COLVIN, DEPUTY COMMISSIONER FOR PROGRAMS AND POLICY, SOCIAL SECURITY ADMINISTRATION
Ms. COLVIN. Chairman Shaw, Subcommittee Members, good afternoon. I am Carolyn Colvin, Deputy Commissioner for Programs and Policy of the Social Security Administration.
Thank you for inviting me here today to discuss the administration's budget proposals for making changes in the welfare reform provisions affecting Supplemental Security Income eligibility for noncitizens and our implementation of current welfare reform provisions.
At the outset, I want to be clear on one very important point. President Clinton remains committed to welfare reform. He is committed to the welfare-to-work initiative; he has shown the strength of his commitment in the budget he sent to Congress just last Thursday.
But the President is concerned as well, particularly with the SSI provisions which bar aged, blind, and disabled noncitizens from benefits. Under welfare reform, the Congressional Budget Office estimates that 500,000 legal immigrants receiving SSI benefits will lose eligibility by September of this year. Therefore, the administration first proposes restoring SSI eligibility to legal noncitizens who become blind or disabled after entering into the country, as well as all disabled noncitizen children.
Page 37 PREV PAGE TOP OF DOC Most immigrants enter this country with a promise that a U.S. citizen will act as a sponsor to support them financially until they can support themselves. This is a commitment the administration wants to see continue. Furthermore, we believe sponsors of noncitizens who are already disabled prior to their immigration should continue to be responsible for these immigrants.
But we also realize that if immigrants suffer a serious illness or injury after their arrival, they may not be able to support themselves, and at the same time, the costs of their care may be too great for the sponsors to bear. In other instances, we must consider those elderly noncitizens who have become disabled, and whose sponsors have either abandoned them or who have died. Too infirm to fulfill citizenship requirements, and without hope of finding a new sponsor, many of these seniors now live in nursing homes and may face eviction once their benefits are cutoff.
The administration is also concerned with the newly established 5-year limitation on benefits for refugees, asylees, and noncitizens whose deportations have been withheld under section 243(h) of the Immigration and Nationality Act. Up to 135,000 legal immigrants may be affected by this provision. Therefore, the administration's second proposal is to change the 5-year limit to 7 years of eligibility.
Fleeing political, racial, or religious persecution, these immigrants come here with few assets or resources. Therefore, the current limit on SSI means that, even as an immigrant is in the midst of application for citizenship, with its 5-year residency requirement, he or she may be cutoff from benefits and left with little or no means of support.
The administration proposes 7 years of eligibility which would allow sufficient time for these immigrants to become U.S. citizens without an interruption in their SSI benefits. In a resolution adopted by the National Governors' Association, the Governors urged Congress and the administration to work in partnership with the National Governors' Association to ensure that the immigration system and its requirements are fair both to citizens and noncitizens, and meet the needs of the aged and disabled legal immigrants who cannot naturalize and whose benefits may be affected.
Page 38 PREV PAGE TOP OF DOC The President's proposal will allow SSI eligibility for immigrants who become disabled after entering the country and extend the 5-year eligibility for refugees and asylees.
Now let me briefly address our current implementation of the new legislation. We have already begun mailing notices about the new provisions to noncitizens and those whose citizenship has not yet been verified. We are sending out approximately 110,000 notices each week, over an 8-week period. At this rate, we will have notified approximately 900,000 individuals by March 31, 1997, as required by the statute.
Again, I want to thank you for this opportunity to address you and I welcome your questions.
[The prepared statement follows:]
Statement of Hon. Carolyn Colvin, Deputy Commissioner for Programs and Policy, Social Security Administration
Mr. Chairman and Members of the Subcommittee:
I am Carolyn Colvin, Deputy Commissioner for Programs and Policy of the Social Security Administration, and I will discuss the Administration's budget proposals for making changes in the welfare reform provisions affecting Supplemental Security Income (SSI) eligibility for noncitizens. I also would like to bring you up to date on SSA's progress with the implementation of the welfare reform provisions relating to noncitizens.
At the outset I want to emphasize that the President remains committed to welfare reform and to the core issues related to his welfare-to-work initiative that he has supported in the past and that he has strengthened in this year's budget. The President, however, is concerned with the provisions of the law that deny most legal immigrants access to fundamental safety net programs, even though legal immigrants were admitted into this country as full members of our community and they work and pay taxes.
Page 39 PREV PAGE TOP OF DOC When President Clinton signed the welfare reform legislation into law, he said that: We should not be punishing people who are working for a living already; we should do everything we can do to lift them up and keep them at work and help them support their children. We also believe that the congressional leadership insisted on cuts in programs for legal immigrants that are far too deep.
The President reiterated this message in his State of the Union address: And we must join together to do something else, too, something both Republican and Democratic governors have asked us to do: to restore basic health and disability benefits when misfortune strikes immigrants who came to this country legally, who work hard, pay taxes, and obey the law. To do otherwise is simply unworthy of a great nation of immigrants.
The proposal in the President's FY 1998 budget would make exceptions to the restrictions in the SSI and Medicaid Programs for certain noncitizens who become blind or disabled after their entry into the United States and allow SSI and Medicaid eligibility for immigrant children on the same basis as citizen children. The proposal also would extend the 5-year eligibility limit to 7 years for refugees, asylees, and noncitizens who have had their deportations withheld.
OVERVIEW OF WELFARE REFORM PROVISIONS
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 contains provisions that severely restrict the participation of noncitizens in the SSI Program. These provisions include general bars to SSI eligibility. It also includes provisions requiring the ''deeming'' of a sponsor's income and resources to a noncitizen and obliging a sponsor to reimburse the government for benefits paid to the noncitizen. Although refugees, asylees, and noncitizens whose deportations have been withheld under section 243(h) of the Immigration and Nationality Act (INA) may continue to be eligible for SSI, the new law limits their eligibility to only the first 5 years after they are granted such immigration statuses.
Page 40 PREV PAGE TOP OF DOC Legal immigrants may be eligible for SSI if they meet one of the SSI eligibility categories in welfare reformi.e., they earn or can be credited with 40 quarters of work or if they are members of the military or veterans (and certain of their family members). In addition, the welfare reform provisions relating to sponsor-to-immigrant deeming and the sponsor's obligation to reimburse the Federal Government for any SSI benefits provided immigrants during the deeming period would apply.
Under welfare reform rules, only about one-quarter of the lawful permanent residents who received SSI in 1996 would meet one of the new SSI eligibility categories. Of the noncitizens on the rolls, 255,000 (33 percent) are disabled and under age 65, 321,000 (40 percent) are aged 6575 and 227,000 (27 percent) are over age 75.
EXEMPTION FOR IMMIGRANTS WITH DISABILITIES AND CHILDREN
The President's proposal would provide SSI and Medicaid eligibility for individuals who meet the definition of ''qualified alien''(see footnote 1) in the welfare reform legislation if their blindness or disability began after they were admitted to the United States. The proposal also would provide immigrant children the same access to SSI and Medicaid as our nation provides citizen children. Noncitizens who do not meet the ''qualified alien'' definition and persons who are in the country illegally or temporarily would not be eligible for SSI.
Many legal immigrants may face unforeseen problems before they can naturalize. Our country should assist legal immigrants and their families when an accident or disabling illness prevents them from supporting themselves.
We must remember that these individuals who receive SSI on the basis of disability have severe medical impairments, little or no income or resources of their own, and limited (if any) earnings capacity. In fact, in order to be considered disabled for SSI, an individual must have a mental or physical impairment so severe that it prevents him or her from doing any work for a period of 12 months or would result in his or her death.
Page 41 PREV PAGE TOP OF DOC As examples, an immigrant who was paralyzed in a construction site accident, or an 80 year old immigrant widow with alzheimers who has outlived all her citizen children and is in a nursing home, or a young immigrant who develops inoperable cancer and is unable to work would be eligible for support. The Administration believes we should not abandon individuals in these circumstances.
In addition to the compelling needs of the affected immigrants, the Administration's proposal will prevent a substantial cost shift to State and local government, churches and nonprofit organizations. The nation's governors identified this problem and in a statement by the National Governors' Association urged ''Congress and the administration to work in partnership with the National Governors' Association to ensure that the immigration system and its requirements are fair to both citizens and noncitizens and meet the needs of aged and disabled legal immigrants who cannot naturalize and whose benefits may be affected.''
The Administration continues to support holding the sponsors of immigrants responsible for those they bring into the country. Sponsors generally sign affidavits of support for those they sponsor. The Administration supported making these affidavits of support legally enforceable documents. The immigration reform legislation enacted in September last year included this provision. The Administration continues to believe that sponsors should be held responsible for the financial support of immigrants in most situations.
However, the Administration is concerned that when a sponsored immigrant experiences an unforeseen disability after entry into the United States, the potential financial impact on the sponsor could be devastating. If an illness or accident occurs that makes the immigrant unable to work, the sponsor would be liable not only for the immigrant's basic needs but also for the cost of his or her medical care and other expenses attributable to disability. Such expenses may be beyond the sponsors' means.
The President's proposal addresses this potentially adverse effect by allowing SSI and Medicaid eligibility and removing the deeming requirements, the 5-year ban, and the obligation of sponsors to reimburse the Federal Government for any SSI benefits received by immigrants who became disabled after entering the country.
Page 42 PREV PAGE TOP OF DOC While the President's proposal would permit SSI and Medicaid eligibility to children as well as adults who become disabled after they enter the country, the proposal also addresses the needs of children who are already disabled when they enter the country. Under the proposal, disabled individuals who enter the United States as lawful permanent residents before they are aged 18, would be eligible for SSI and Medicaid, and the exemptions for deeming and sponsor reimbursement would apply.
In a number of cases, disabled children who enter the country would do so accompanying their parent. Thus, even though sponsor-to-immigrant deeming would not apply, the child's parent's income and resources would be taken into account in determining the child's need for benefits.
The proposal creates a safety net for disabled children. Unlike adults who can become U.S. citizens after they have lawfully resided in the country for a specified number of years, children cannot naturalize on their own until they reach age 18. Naturalization of one noncitizen parent can be accompanied by naturalization of the child. If both parents naturalize, the child automatically derives citizenship. Thus, if something happens to their noncitizen parents, these disabled children would have no means of support and could not otherwise be eligible for SSI until they became U.S. citizens.
REFUGEES AND ASYLEES
The President's budget proposal also includes a provision for extending the time limit for SSI eligibility from 5 to 7 years for refugees, asylees, and individuals who have had their deportations withheld under section 243(h) of the INA.
Individuals in these three immigration categories are in the United States because they have been subjected to persecution in their homelands because of their race, religion, nationality, membership in a particular social group or political opinion. An estimated 135,000 SSI beneficiaries are in these categories. They often have suffered much hardship and arrive in the country with little or no resources. If they are aged, blind, or disabled they may be eligible for SSI, Medicaid, and other programs for a period of 5 years after they are granted refugee, asylee, or deportation withheld status. Before welfare reform legislation, there was no restriction on the length of time that they could receive benefits. Now they are eligible for SSI for only a period of 5 years after entering the country.
Page 43 PREV PAGE TOP OF DOC Generally, immigrants who have been in the United States for 5 years may apply for citizenship. Although INS accepts naturalization applications up to 3 months before the 5 year requirement is met, the naturalization process can take up to 6 months and, in some areas of the country, can be of even longer duration. Currently, the process is running much longer due to record application volume and additional procedures recently implemented. Thus, individuals who entered the United States as refugees, asylees, or who have had their deportations withheld, are very likely to lose their SSI eligibility even if they apply for citizenship at the earliest possible date. Such immigrants generally do not have sponsors and would have nowhere to turn for assistance in the interim. The proposal would allow sufficient time for them to become U.S. citizens without an interruption in their SSI benefits.
Now that I've described the President's proposal let me turn to SSA's efforts in implementing the noncitizens provisions in welfare reform.
IMPLEMENTATION OF NONCITIZENS PROVISIONS IN WELFARE REFORM
In planning for carrying out the noncitizens provision in welfare reform, SSA has put together a team made up of representatives from virtually every SSA component. The team has been meeting since August 1995, and has devoted innumerable hours to policy and operational issues involved with the provisions. Implementation policies have been coordinated with other Federal agencies such as the Department of Agriculture, The Department of and Health and Human Services (including the Health Care Financing Administration), and the Immigration and Naturalization Service (INS).
Numbers of Noncitizens Affected
Page 44 PREV PAGE TOP OF DOC Before I begin describing our implementation strategy, I would like to give you an idea of how many noncitizens on the SSI rolls would lose eligibility if the prohibition on SSI eligibility remains unchanged.
As of October 1996, there were approximately 800,000 recipients receiving SSI who entered the program as noncitizens. Nearly three-quarters of them were lawful permanent residents. The remainder were mostly refugees and asylees. Some of these individuals may have already naturalized but have not informed SSA. Also, given the fact that applications for U.S. citizenship are at an all-time high, a numberperhaps a significant numberof the noncitizens who currently receive SSI may become citizens by the end of the summer.
SSA estimates that in the first full year of the prohibition (FY 1998), about 500,000 noncitizens will lose SSI eligibility according to CBO estimates. Noncitizens who remain on the rolls will be refugees and asylees who have not been in the country for 5 years, lawful permanent residents who have earned 40 quarters of coverage or who can be credited with 40 quarters earned by their spouses or parents, and military personnel, veterans, and their spouses and children.
Identifying Beneficiaries Potentially Affected
The major task that we faced in implementing the new law was to identify those SSI recipients who are to be made ineligible by the legislation. First we made sure that our records concerning immigration statuses were current. It wasn't until last fall that SSA was able to change the codes that indicated which immigration status an individual was in if he or she changed statuses. For example, if a person was a refugee when first eligible for SSI, he or she would still have been shown as a refugee even if he or she subsequently became a U.S. citizen. In addition, prior to 1981, SSA's computer records did not contain information about an SSI recipient's citizenship or immigrant status. When we began, we had an estimated 1.4 million SSI recipients in our records shown as either noncitizens or citizens whose citizenship had not been verified.
Page 45 PREV PAGE TOP OF DOC In order to correct our records, we initiated a series of computer matches. We matched the SSI records with our Social Security number records and the INS naturalization records. These matches allowed us to establish U.S. citizenship for approximately 320,000 recipients. We also matched SSI records of noncitizens to SSA's earnings records to determine which lawful permanent residents had earned 40 quarters of coverage and, thus, would be exempt from the SSI ban. In addition, as I mentioned, we are now able to update the SSI records when individuals bring proof of their citizenship status into our field offices. All of these efforts have left us with approximately 900,000 SSI beneficiaries who are either noncitizens or citizens who have not yet had their citizenship verified.
Our next task is to notify the approximate 900,000 individuals of the new SSI eligibility provisions before March 31, 1997, as required. As you may know, we began mailing the first notices last week. Because of other workloads relating to the welfare reform provision on SSI benefits for disabled children and an earlier provision eliminating SSI benefits on the basis of drug addiction and alcoholism, we are sending the notices on a staggered basis of about 112,500 per week over an 8 week period. All these ''informational'' notices will be in the hands of the beneficiaries by the statutory deadline. It is important to note that this mailing is only the first of two notices that noncitizens will receive before their benefits stop.
The informational notices include a list of the categories of noncitizens who may continue to be eligible for SSI and explain what an individual has to do to prove that he or she is in one of the categories. The notices also say that SSA may be able to help the individuals get the proofs they need. We have put the most important message right at the top of the notice. That is, if it cannot be proven that a noncitizen is in one of the SSI-eligible categories, his or her SSI benefits will stop.
Page 46 PREV PAGE TOP OF DOC There are three different versions of this first notice tailored to individual circumstances. The notice going to beneficiaries shown on our records as noncitizens asks them to contact SSA within 90 days if they think that they may be in one of the SSI-eligible categories. The notice going to persons whose citizenship status has not been verified and to noncitizens who are likely to remain eligible(see footnote 2) tells them that we have to update our records and will be contacting them at a later date. The third version of the notice is being sent to refugees and asylees who have not been in the United States for 5 years. This notice will say that their SSI eligibility is now time limited and that we will contact them again shortly before the time-limit expires.
All of the notices include an enclosure in eight languages, including English, explaining that it includes very important information about SSI eligibility and if they cannot read English, they should take it to someone who can read it to them right away. For those recipients who have indicated Spanish language preference on their record, the notices will be sent in both Spanish and English.
Individuals responding to these informational notices will create a large workload for SSA's field offices. In order to alleviate some of this workload and to provide better service to our customers, we have established 22 interviewing centers in areas across the country where large populations of noncitizen SSI recipients live such as Los Angeles, the central valley of California, Miami, and New York. SSA has hired over 1,000 temporary employees to assist with implementation of the welfare reform provisions. Of these 195 will be assigned along with experienced SSA employees to staff the interviewing centers. Notices being sent to recipients in these areas will include the address and hours of operation for the center nearest them.
Individuals who provide proof of their continuing eligibility for SSI will receive a notice from SSA verifying their eligibility.
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Planned Action Notices and Suspensions
Individuals who do not contact SSA or who do not provide proof of continuing eligibility after they receive their informational notice will receive a second notice; a notice of planned action (NPA) informing them that their SSI benefits will stop. NPAs also will be sent out on a staggered basis. Noncitizens who received the informational notices in February will receive the NPA in July and those who received informational notices in March will receive the NPA in August. The NPA will state that benefits will stop the following month (August or September, as applicable).
Under our longstanding, due process rules, the NPA will tell individuals exactly why their benefits are being stopped and advise them of their appeal rights. If an individual requests appeal with 10 days of receipt of the NPA, benefits will be continued until a decision is made at the initial level of appeal. Although benefit continuation applies only if the individual files an appeal within 10 days, he or she may appeal the determination at anytime within 60 days after receipt of the notice.
We have made the policy decision that the stopping of an individual's benefits in these cases will permit us to reinstate an individual's eligibility if, within 12 months from the suspension date, he or she becomes naturalized. The reinstatement would be effective as of the date of naturalization. While this may seem a mere technicality, it assures that former SSI recipients who become citizens will not have to go through the full SSI application process (including a disability determination in disability cases) and will again get SSI benefits as soon as possible after letting us know that they have been naturalized. This policy decision also illustrates SSA's commitment to implementing these changes in a way that is fair and causes as little stress as possible for our aged, blind and disabled beneficiaries.
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Clearly, SSA and other Federal agencies have faced a huge task in implementing the provisions in the welfare reform legislation.
In conclusion, while we are working to implement the law, we strongly support and hope Congress will act on the Administration's proposal. The provisions relating to noncitizen eligibility for SSI that were contained in welfare reform are unnecessary to further the goal of welfare-to-work. The SSI and Medicaid provisions summarily cut children and disabled individuals off of benefits, putting at risk individuals who are permanent members of our society. The President proposes to restore eligibility for children and those disabled after entry.
Thank you for the opportunity to discuss these very important issues. I will be happy to answer any questions that you may have.
Chairman SHAW. Mr. Uhalde.
Ms. GOLDEN. Mr. Uhalde is available to answer questions.
Chairman SHAW. Mr. Camp, you may inquire.
Mr. CAMP. Thank you. Thank you, Dr. Golden. Obviously, the concept of every child having a permanent home is something we all are trying to find a better way to achieve and we all agree with. Doubling the number of adoptions by the year 2002, I think, is an admirable goal and I look forward to learning more about this incentive program that you testified to.
But about one-half of the children that do not have permanent homes are in foster care and they are there for a very long time. A higher percentage of those in long-term stays are subsidized by Federal dollars. My question is, Is the administration considering any policy that would reduce, rather than just give incentives, but reduce the Federal subsidies after a child has been in foster care for a certain amount of time, say 1 year or more?
Page 49 PREV PAGE TOP OF DOC Ms. GOLDEN. Let me start, Congressman Camp, by saying thank you, because we want to recognize the leadership you and your colleagues have provided on this issue. As we have been working through where we are going, we found it very useful and look forward to working with you in the future.
Let me say a little bit about where we are in the process and then respond to the specific question about incentives and penalties. The President made the directive to Secretary Shalala in December and asked us to report back with specific proposals in 60 days, which is tomorrow. Tomorrow we will be delivering a report to the President and at that point we will expect to be able to talk in much more detail about the particular structure.
What we have been doing over this period is consulting intensively with about 600 people. Where we have come out at this point is that the incentive is an important tool. It will be the first performance-based payment we know of in the Federal child welfare system. This Subcommittee has really led the way, I think, in trying to focus on results and not on paperwork. So we are excited about that.
We thought about the possibility of a penalty and I think where we are at this point, after our consultation, is that we are concerned about the potential effects on children. As you note, there are children who are in long-term foster care. For those children, we certainly want States to be doing better, but right now that is where those children are. They may have considerable needs that require intensive services. We think withholding money would carry a considerable risk.
I know you have deep concern about those issues, as well, and we would want to talk about it. But that is where we have come out at this point.
Mr. CAMP. And I certainly look forward to working with you on the legislation that I hope to be introducing with Mrs. Kennelly very soon. I think we will have some areas that we have in agreement, particularly on when reunification of a family is not going to be possible, because we all agree that safety of children is the most important thing.
Page 50 PREV PAGE TOP OF DOC Last year we passed a law that greatly strengthened the Federal Government's commitment to timely adoption, which is something I am very interested in, regarding interethnic adoptions. The legislation would reduce child protection funding to States that deny or delay placement of children. I wondered where the Department was on issuing regulations implementing that provision of the law?
Ms. GOLDEN. That is one of several enormously important pieces of legislation the Congress passed, including the adoption tax credit, as well. We have issued an informational memorandum to programs regarding the new statutory provisions, and we are currently working within the Department on more detailed guidance for States to consider as they take further steps in their policies and more detailed information on the penalty implementation. So we are working on that right now.
Mr. CAMP. Do you have any information now about any changes in the frequency of interethnic adoptions? Any current?
Ms. GOLDEN. I do not have that information. I am more familiar with where States are in terms of their statutory changes than with what impacts have been felt, but we could look and see if there is information available.
[The following was subsequently received:]
Dates from the combined fiscal year 1995 AFCARS adoption data base show that 75.5 percent of the adoptions were for cases where the adoptive parents had the same race/ethnicity of the adopted child. The remaining 24.5 percent of the adopted children were transracially placed. For fiscal year 1996, the percentages were 76.3 and 23.7 percent, respectively.
The estimate for fiscal year 1996 is preliminary since more States are expected to submit data.
Page 51 PREV PAGE TOP OF DOC
Mr. CAMP. And again, I guess, what steps might be taken to know whether States are violating this law. How will we know, to make sure that the provisions of the law are implemented properly?
Ms. GOLDEN. I think there are a number of ways to know. Clearly, the first step is changing statute and policy. A second step is responding to complaints from families. But a third step is to be very committed in our monitoring of State child welfare programs. We will be looking at them not only in a way consistent with the law, but in a similar way to the way the Office of Civil Rights will look at the same issues. So we will all be looking at the issues together with a shared protocol and approach. And we are hoping that will help us be more effective.
Mr. CAMP. OK, thank you very much.
Chairman SHAW. Mr. Levin.
Mr. LEVIN. Mr. Chairman, let me yield at this point. My other colleagues have not had a chance to participate, so I will hold back and perhaps at the end I will want to participate.
Chairman SHAW. Mr. Stark.
Mr. STARK. Thank you, Mr. Chairman. Dr. Golden, I do not want to necessarily shoot the messengers today. It is important you know that my comments are directed somewhat higher up the line at the administration and the White House, and certainly not at you, who have no freedom in making any of these determinations but have to do what you are directed.
I am concerned we are here patching potholes. The President joined with the Republicans, everybody from here on voted for this turkey and everybody from here down voted against it. Then the President sold out the children to get reelected. He is no better than the Republicans and rather like Jonathan Swift, if you are familiar with Swift's solution to helping solve the economic problems of his time.
Page 52 PREV PAGE TOP OF DOC The President has taken over 1 million of our most valuable citizens, our little children, and tossed them into poverty. Those are the numbers you all came up with in response to Senator Moynihan when this bill was passed. We know you know, he may not, that these 1 million kids are coming from families who will not be able to put food on the table because they will not have food stamps. If they go to work, they will be forced to leave their children in the back of cars because they cannot find child care providers in their communityat least they will have a mile-long waiting list. These parents will not be able to take their kids to a doctor to get them the preventive care they will need.
We do not have to do this. There were 1 million, 1.2 million, depending on whose study you take, children that Health and Human Services told us were going into poverty. Where are they? What are the specifics? I doubt very much that this program is designed to take more than 300,000, 400,000 of those out of poverty. That leaves us with around 700,000 hanging out. What are you going to do for them?
Ms. GOLDEN. Let me respond in a couple of ways, Congressman Stark. I, as you know, share your commitment and, I think, a broad commitment to the goals which the Congress and the President hoped would come out of the legislation. That is, moving families to work, protecting children, and ensuring parental responsibility. And it matters enormously to me that we succeed in achieving those goals.
That is why, for example, in child care
Mr. STARK. We do not share that goal. We never did. We thought it was wrong-headed to begin with, when the Republicans proposed it, and it was a sellout by the President to sign it. So I do not want to be tarred with that brush. That is the problem, not the solution.
Let me comment first on the 1 million children number and then on some of the things we are doing to keep track, because I share the view that when children are doing better we need to know, and likewise when they are not doing well.
Page 53 PREV PAGE TOP OF DOC I just want to know how we are going to care for the 1.2 million children? Keeping track of them is irrelevant. What will you do to get them out of poverty?
Ms. GOLDEN. The predictions of 1 million children being moved into poverty included a variety of categories in this proposal. In the statute, the only provision that would move children off public assistance because of AFDC changes has to do with the 5-year time limit. I believe what we need to do is make sure that families, in fact, move to work during those 5 years.
Other key provisions that were addressed in that study included the immigration cutoff, so those proposals are immensely important to that.
I also want to highlight two other things
Mr. STARK. Let us stop right there. My time has expired, but let me just stop with this. What program do you know of that is going to create any jobs? The programs that are in here have not worked in the past. All they have done is shift people from one job to another through tax credits. You mean there is a new program in there that you are willing to suggest that an economist worth their salt will say is going to create new jobs?
We have not heard any details and I doubt if there are any, but I would love to hear them if there are.
Ms. GOLDEN. Sure. Let me give an overall comment and then ask Mr. Uhalde to speak more to that. As you know, the context is the creation of about 11 million jobs in the economy as a whole. In addition, quite a number of States have been developing a variety of approaches to implementing work. Missouri in Kansas City, Oregonexcuse me?
Mr. STARK. How many jobs are there in Wisconsin?
Ms. GOLDEN. I do not know but I would be happy to report back. I do not know the numbers. The States that have been particularly successful have been doing quite a variety of different things.
Chairman SHAW. If I may, you brought up Wisconsin. The Wisconsin spending, the average spending per beneficiary from just the Federal dollars in 1994 was $4,442. We project, and the Congressional Research Service projects, that that is going to increase because of the successes in Wisconsin to $12,182. These figures have been handed out to the Subcommittee, and I think it really shows. The study that you referred to, it carries an assumption that nobody is going to go to work. I would say we need to have more faith in the people.
Page 54 PREV PAGE TOP OF DOC This is really weird sitting here in the middle. The attack is coming from the Democrat and the accolades are being thrown by the Republicans. So times certainly have changed.
Mr. COLLINS. Mr. Chairman, I am going to pass in favor of hearing some more of those comments from the other side.
Chairman SHAW. Mr. Matsui.
Mr. MATSUI. Thank you, Mr. Chairman. First of all, I want to thank you for delaying this hearing for one-half hour. I was at Mrs. Harriman's service today and I appreciated this opportunity. I came back because I was hoping to have an opportunity to question some of the National Governors' Association representatives, or perhaps some of the Governors themselves. I thought they had been on the calendar and apparently they had been dropped off due to no fault of anyone on both sides of the aisle. Apparently, they chose, on their own behalf, not to show up.
I understand there is going to be a technical correction hearing sometime, where the NGA will be testifying. Perhaps if the Chairman could indulge and ask them, perhaps they could comment on the President's package as it pertains to the welfare changes because I think it would be important to hear from them. If they think it is good, fine. If they think it is bad, fine. If they do not have any opinion, I would like to know that.
Chairman SHAW. If you will yield for a moment, the administration
Mr. MATSUI. I hope my time is not being used.
Chairman SHAW. I will put it on. I will put it back on, I just wanted to answer your question.
Mr. MATSUI. Thank you, I appreciate that.
Chairman SHAW. The administration has given us the technical corrections. We are really trying to limit this to technical corrections so the technical corrections bill will not be controversial on either side.
Page 55 PREV PAGE TOP OF DOC Mr. MATSUI. I appreciate that.
Chairman SHAW. We could then get into a full-blown hearing on
Mr. MATSUI. I appreciate that. Perhaps that would be the wrong forum. Perhaps, if the Chair would indulge, maybe we should have the National Governors appear at a hearing at some future date, before we actually begin the markup of a reconciliation package, so we know where they really stand.
I think since we sent these programs down to the States, I would just like to know their response. I think all of us should want to know the response. My Governor, for example, has now shifted AFDC and other programs down to the counties, and the counties now say with the restrictions on their funding they may not be able to handle it. So we just need to get an idea, if the Chair may. So if we could have an opportunity to question the Governors at some time
Chairman SHAW. They will be invited, and I am reasonably sure they will come because we are going to have numerous hearings on the block grant and on the child support provision.
Mr. MATSUI. I appreciate that. I would just hope, and my plea is not to you but to the Governors and the Governors' Association, that they should at least show some courage since they supported the bill last year and come and at least respond to the President's recent initiatives. I think if they do not, they are obviously doing a disservice to their own constituents.
If I may, and I am not going to be long, but Dr. Golden, let me tell you what troubles me. I do not want to make this adversarial. But what troubles me is there are a lot of people sitting in this audience, and there are a lot of people back in California, my State, that are wondering what is going to be happening over the next few months because about 900,000 pieces of mail are going to be sent out by the end of this month. And by August a number of people are going to be thrown off SSI, they are going to be thrown off Medicaid unless something is done.
I do not want anyone to be misled. I just do not want anyone to be misled because States are starting to prepare their budgets at this particular time and if, in fact, they think they are going to get $21 billion or $17 billion over the next 3 or 4 years, they may say, Well, let us just put a little place marker in there.
Page 56 PREV PAGE TOP OF DOC I just want you to know, and I think you need to be candid because many are going to be looking to all three of you for help. There were only 101 Members that voted against this welfare bill last year and only 21 Senators voted against it. If you take the Black Caucus, the Hispanic Caucus, and the California Members that voted against the bill in the House, only 41 Members in the rest of the country voted against this legislation.
Now I do know when the President signed the bill he said he did not agree with the immigration provisions that the Republicans put in the bill, but I heard no one else except for Mr. Levin saying the same thing. As a result of that, I think there may be some illusions that have to be corrected about whether or not we are going to do any major corrections.
Right now, and this is something that both Mr. Stark and a number of us were concerned about, the money that you are talking about, the $17 billion for noncitizens, is going to compete with Head Start Programs, education programs, and housing programs. I think what Mr. Shaw had suggested last week is correct. It is going to be really hard to expect people to vote for noncitizen benefits when they are taking away from citizens' benefits.
So I hope you will be more candid in the next few weeks so that States and local governments and others will know what is going to happen, because I will tell you if you thought the government shutdown was bad last year, this is going to be 10 times worse, when all of a sudden you are going to have people screaming at your doorsteps.
I just want you to be honest with these people because I think there is an illusion about what is really going to happen. People out there are expecting $17 billion to $21 billion. One thing I pride myself on is I try to be honest. And I would just hope that you at HHS, you at Labor, and other people in the administration would also be honest about this.
Ms. GOLDEN. If I may, Congressmen, let me underline a couple of very important things you have just said, and I do not know if the Social Security Administration would want to add. One is you have highlighted the point that the immigrant reductions are imminentover the next few months those notices are going out. It is going to be critical for people at the State and local level to be paying attention because that is about to happen. I think that is a critically important point.
Page 57 PREV PAGE TOP OF DOC The other point I would highlight, in terms of the importance of this set of issues, I would just repeat what the President said in the State of the Union speech, which is that anything else other than fixing this issue would be unworthy of a nation of immigrants.
Mr. MATSUI. Mr. Shaw, would you allow me just to have a followup on that, and I apologize to you?
If the President would say in the next couple of weeks, I will veto any reconciliation bill that does not have $17 billion in there for these legal immigrants, I think some people would feel more comfortable. Perhaps you can go back to the White House and talk to the folks over there and see if they are willing to say that, but I would venture they will not say that and I venture you will not come back with a positive answer on that.
But why do you not challenge them, because that is the only way the States and local governments are going to find out whether they are going to get the funds.
Ms. GOLDEN. Thank you.
Chairman SHAW. Mr. English.
Mr. ENGLISH. Thank you, Mr. Chairman, and Dr. Golden, welcome. Welcome to all of you. We look forward to working with all of you in the coming months as well as with our friends in the Minority, many of whom joined us in welfare reform last year. Whether they call themselves moderates or turkeys or whatever, we are delighted to have them working with us.
I wanted to ask a couple of specific questions on the work opportunity tax credit. I noticed the administration is really proposing two separate tax credits, the work opportunity tax credit and the welfare-to-work provision, which are basically aimed at the same population group. Looking at that, I wonder, are employers utilizing these credits expected to make these sorts of distinctions?
Mr. UHALDE. Mr. English, the administration is proposing two distinct programs. The welfare-to-work jobs challenge is going to be a grant program, whereas the work opportunity tax credit and its expansion is intended to be a tax credit that is provided directly to employers through the tax system. The purpose of the tax credit is to enable individuals to interact directly with employers, not have an intermediary, and be able to use the tax system, which
Page 58 PREV PAGE TOP OF DOC Mr. ENGLISH. You are talking about two tax incentives here. With the work opportunity tax credit that we put in and also the subsequent proposal that you have made, which includes a substantial tax provision.
Mr. UHALDE. Yes. The Congress has passed the work opportunity tax credit. With regard to the tax credit, the President is proposing to add a category to the existing tax credit. There are currently seven. We would add an eighth for the
Mr. ENGLISH. Thank you, Mr. Uhalde. I am familiar with the provisions. I am just wondering, do you think having two tax provisions adds to the complexity for employers who are trying to do the right thing, utilizing these provisions, and bringing people out of the welfare system?
Mr. UHALDE. I do not believe it will be because it will be an extra category.
Mr. ENGLISH. OK. I noticed that under your welfare-to-work initiative, basically, it runs through September 30, 2000. You are also proposing to extend the work opportunity tax credit food stamp category through September 30, 2000. But for some reason, you have felt that the core work opportunity tax credit should only be extended for 1 year, which I find a little puzzling.
Under your proposals, just as the core work opportunity tax credit program would expire, the pressure on the States to reduce their welfare caseload will increase. In your opinion, would you not have a better chance of encouraging employers to utilize this provision if they would expect to see it continued beyond what you have proposed?
Mr. UHALDE. It is possible with a longer time period that there will be more takeup on the basic program. The interest is to focus on the more difficult-to-serve population, which is the expanded tax credit for those people on welfare 18 months or longer would do, and that is why there is more emphasis placed on that.
Mr. ENGLISH. Thank you. With regard to the hiring decisions that you are trying to utilize this program to influence, is the work opportunity tax credit, in your view, meant to be a hiring incentive or a retention incentive?
Page 59 PREV PAGE TOP OF DOC Mr. UHALDE. We believe it is intended to be both. The reason for the extension from 120 to 400 hours was to make sure people are being hired and retained who would not otherwise be hired. The shorter time period essentially subsidizes employers for doing what they would do anyway, try out people.
Mr. ENGLISH. If the credit is meant to provide a break to someone the employer might not otherwise hire, then why such a long retention period, and recognize that employers claim the additional costs of hiring from these targeted groups are generally clustered in the first few weeks of employment. If the person quits or is fired before 400 hours, the employer has taken all of the risks and gotten no reward. How would you respond to that concern?
Mr. UHALDE. I would respond that there is a lot of hiring that goes on, a lot of very short-term employment for people who are on welfare and other categories, and we do not want to pay employers for something that would be done already. We are trying to cause longer term employment for these target groups.
Mr. ENGLISH. Thank you. I look forward to working with you on this and puzzling through some of these policy decisions.
Mr. Chairman, I appreciate the opportunity to pursue this line of questioning.
Mr. UHALDE. Thank you.
Chairman SHAW. Thank you, Mr. English.
Mr. COYNE. Thank you, Mr. Chairman.
Dr. Golden, I understand the administration is going to propose policies that will try to alleviate some of the more onerous provisions of the food stamp provisions that are in the legislation. Could you elaborate on what they are going to be and how they are going to be designed to alleviate the problem?
Ms. GOLDEN. I believe we have someone from the Department of Agriculture who could provide additional details. Key proposals on the immigrant side extend the period of time, delaying the ban for immigrants receiving food stamps. The other key changes to food stamps are creating and funding a real food stamp work requirement at $2.2 billion, assisting families with high housing costs, and providing benefits which recognize the cost of living, for a total investment of $3.1 billion.
Page 60 PREV PAGE TOP OF DOC Mr. COYNE. But how is that going to supply food for people? I understand those provisions, but how is that going to alleviate the lack of food stamps for certain clientele?
Ms. GOLDEN. Let me consult for a moment with someone here from USDA.
Ms. O'NEIL. I am Bonnie O'Neil. I am the Associate Deputy Administrator for the Food Stamp Program. The President's specific proposals were outlined by Dr. Golden. The situation for legal immigrants is that new applicants for the Food Stamp Program are immigrants who are no longer eligible and have not been since September 1. Current participants are going to begin to lose benefits on April 1 and all must be off the program by August 22. The President's proposal would extend their eligibility for a short period of time. They must be off the program by September 30 of this year. The intent is to provide a little additional time for them to seek citizenship.
Mr. COYNE. So, it is an extension of time for them to become citizens, is that correct?
Ms. O'NEIL. That is correct. I can go through the other provisions.
Mr. COYNE. No, that is fine. I would like for you to provide those provisions for us in writing.
Ms. O'NEIL. I would be happy to.
[The following was subsequently received:]
INSERT OFFSET FOLIOS 1 TO 2 HERE
[The official Committee record contains additional material here.]
Mr. COYNE. Dr. Golden, in your testimony, you note that you will be asking for statutory clarification in the work area so that success in placing recipients in a work program is considered when you determine whether a State has met the work participation rate. Could you explain what that means, what that language means?
Page 61 PREV PAGE TOP OF DOC Ms. GOLDEN. Sure. I am glad you asked. That was actually one of the issues I was hoping to touch on earlier.
We have just issued some guidance to the States which attempted to balance our commitment to flexibilityso States can meet family needs, conserve families after 5 years, conserve families in a variety of creative wayswith the commitment to work, because we want to make sure States continue to work on enabling families to move toward real work opportunities.
In that guidance, we said we wanted to come back and work with the Congress and the Governors on a couple of things. One of them, as you have noted, is that we want to work with everyone to make sure States focus on work, both for families that they are paying for with Federal dollars and with State dollars. There had been concernalthough I do not actually believe this will happenthat States might choose to game the requirements, to figure out who to put where and then not invest resources in all families. I actually believe from my experience with the Governors and the States that they are committed to investing in all of the families, but that provision is intended to work there.
A second thing we did, and I think this is especially important to me, in part because of the concerns Congressman Stark raised, we also said we would come back to Congress to work on the data requirements because we want to make sure we do not lose track of health care or of parents because of the way States put people on State or Federal funds. We want to make sure we are providing flexibility but also keeping track of what happens to families.
Mr. COYNE. Thank you. I guess maybe Mr. Uhalde could answer this question. Relative to the tax creditthe job opportunity tax creditwhat will you be doing to make sure you are not going to displace other low-income workers by hiring people from welfare-to-work? Can you be specific about what you are going to do to make sure people who are already low-income workers and are working will not be displaced by the new group?
Mr. UHALDE. You are referring to provisions in the tax credit that employers will not lay individuals off to take advantage of the tax credit. But the more serious problem and issue will be where we have vacancies where both people with tax credits and without tax credits have opportunities for jobs, and the essential nature of the tax credit is to try and level the playingfield by giving these peopleovercoming some of their obstacles by providing them with a tax credit.
Page 62 PREV PAGE TOP OF DOC So I think the problem is not so much people being laid off and others being hired for those positions. The position is essentially the competition for more jobs among low-wage workers.
Mr. COYNE. So you do not envision businesses taking the opportunity to take a 50-percent tax credit by hiring someone new and laying someone else off?
Mr. UHALDE. No, under the tax credits. But I think the problem of whether net jobs are created and more employment is created is more subtle than that with the tax credit.
Mr. COYNE. Thank you.
Chairman SHAW. Mr. Hayworth.
Mr. HAYWORTH. Mr. Chairman, I thank you for your leadership and I appreciate the opportunity to be a part of this Subcommittee, as I appreciate the differences in perspective that we may have here with some of our friends on the other side of the aisle.
Mr. Chairman, it seems to me one thing we should all keep in mind is something my colleague who joined me in the 104th Congress from the State of Oklahoma, Mr. Watts, has pointed out, that in terms of measuring effectiveness and success with these very important programs, we should not look to constant increases in those on the rolls in terms of the caseload, but we should look to define success by those who move off welfare and on to work.
With that in mind, Mr. Chairman, again, I salute the press conference this morning, the observation that, for example, in my home State of Arizona, in a 1-year time period, we saw almost a 7.5-percent reduction in caseload, projecting that in a 4-year period of time, by 1998, we may see an 11-percent reduction in the caseload. And conversely, as you pointed out, using the figures from the State of Wisconsin where the Governor there has worked hard with a welfare waiver.
In my own State of Arizona, we will see a projected increase in benefits per family, for those folks who need help, in excess of 30 percent. I think that is to be championed, and it may be there is a legitimate philosophical difference here. It may be that some believe it is the role of government to be the charity of first recourse in our society and that any other point of view is somehow malicious or working from the notion of depravation.
Page 63 PREV PAGE TOP OF DOC Let me assure my friends, who I respect, on the other side and those who may hold a different view of the role of government in terms of welfare that that is precisely not the case, that the notion is to have true compassion by opening the doors of opportunity. And to the extent we have found with the administration some common ground in this notion of bipartisanship and working to solve problems, it is to be welcomed.
I also noted with interest the comment from my friend from California, and I do not doubt his sincerity, but somehow to suggest that we should forgo an honest bipartisan dialog to achieve the first balanced budget in over a generation, to hold out billions of dollars for noncitizens who come here for opportunity, opportunity which will exist in the free market, I find very curious.
With that in mind, let me turn to another area, because we have heard the bells, and like school, we have responsibilities elsewhere, that I know the Chairman and other Members are mindful of.
I am especially interested in the notion of child support and the child support incentive system which last year's bill required your Department to help provide Congress with recommendations on. The report, going back to the school analogy, is due March 1 and this Subcommittee is planning to hold a hearing on the report and then to introduce legislation to implement a new incentive system.
Well, here is the question. Will the term paper be ready, the recommendations? Will we be able to meet the March 1 deadline?
Ms. GOLDEN. We expect that we will. We have been working very intensively with the child support directors in a range of different States to work on the particulars of that incentive system. We are very excited about the possibility of talking with you about it after it is complete.
Mr. HAYWORTH. I would assume you would agree to meet with us in the near future to review the particulars of your recommendations and provide all the technical information about your proposal?
Page 64 PREV PAGE TOP OF DOC Ms. GOLDEN. Absolutely.
Mr. HAYWORTH. I thank you very much.
Chairman SHAW. Thank you, Mr. Hayworth.
Mr. LEVIN. Let me not ask a question but just say a couple of things to you, Mr. Hayworth, and to others. Let us look at the facts here. No one should be surprised that we were going to revisit the immigrant and the food stamp issues and also work moneys to implement the welfare-to-work bills. The President served notice, and I do not think he could have made it clearer, that he was going to propose that.
The immigrant provisions do not relate, in most cases, to able-bodied people. This is not a question of people who should be working not working. The issue is, you talk about true compassion, what is going to be the impact of this bill, not 2 or 5 years ago as we are talking about the gist of welfare reform, welfare-to-work, where there are 5-year deadlines and some 2-year deadlines, but next month, the month thereafter, and the month thereafter.
We are talking about older people. True, they are noncitizens, and I think their sponsors should perform their responsibilities. A lot of these people do not have sponsors and a lot of these people became disabled after they entered. It is up to all of us to look at the facts and not to choose up sides in advance depending on how we voted last time or whatever.
Mr. HAYWORTH. Will the gentleman yield?
Mr. LEVIN. Sure.
Mr. HAYWORTH. I thank my friend, the distinguished Ranking Member, for his point of view, and let me say in response, that is why I welcome the next panel that will join us because I think you precisely point out, for the reasons of people who, to use an overused term, fall through the net, that it is vital to hear what groups other than government can do in neighborhoods in dire situations precisely because of what you mentioned to help solve this problem.
Page 65 PREV PAGE TOP OF DOC Mr. LEVIN. Let us do that, but with some openmindedness and not closedmindedness, without prejudgments, and I will finish with this. Both of the parties have roots in the welfare-to-work reforms. There are some who voted against that portion of it. One-half of the Democrats voted for it and virtually all the Republicans.
We are talking here about the legal immigrant provisions and in other Committees about the food stamp provisions, about provisions that click in now, as I said, not years from now, and I finish with this. If it is not done through the reconciliation process, in any future year if we want to take action, it will be on a pay-as-you-go basis and we will have to come up with specific tax revenues to cover that.
So all we need to do now is to try to be both objective and compassionate, dispassionate and compassionate, and I have to think that we have it within our system and within ourselves to take that kind of a look, and I welcome the next panel and I will finish. We are going to come back and hear from it, and then I hope we will hear from the Governors who have a stake in this and from other people, Mr. Shaw.
Chairman SHAW. Thank you, Sandy.
There is a roll call on the floor so we will go into recess. I would like to thank this panel. Dr. Golden, you survived the attack from the Democrats with dignity and grace. [Laughter.]
We very much appreciate your being with us. Believe me, I think you will find a lot of cooperation from this Subcommittee on both sides of the aisle in making this thing work.
Ms. GOLDEN. Thank you, Chairman Shaw.
Chairman SHAW. We will be in recess for approximately 15 minutes.
Chairman SHAW. If the next panel could make their way to the table, we will get started.
Page 66 PREV PAGE TOP OF DOC The next panel we have is Wade Horn, Ph.D., the president of the National Fatherhood Initiative of Gaithersburg, Maryland, certainly no stranger to this Subcommittee, nor is Robert Rector, who is a senior policy analyst, The Heritage Foundation of Washington, DC; Sharon Daly, who is the deputy to the president for social policy of the Catholic Charities USA, in Alexandria, Virginia; and Diana Aviv, associate executive vice president for public policy, Council of Jewish Federations, also in Washington, DC.
We have each of your full statements that will be made a part of the record. You may proceed as you wish.
STATEMENT OF WADE F. HORN, PH.D., PRESIDENT, NATIONAL FATHERHOOD INITIATIVE, GAITHERSBURG, MARYLAND
Mr. HORN. Thank you very much, Mr. Chairman. My name is Wade Horn. I am a child psychologist and president of the National Fatherhood Initiative, whose mission is to improve the well-being of children by increasing the number of children growing up with involved, committed, and loving fathers in their lives.
Formerly, I was the Commissioner for the Administration on Children, Youth, and Families at HHS and as such, if there are any questions that you have about adoption policy, I would be happy to address those. I also served as a member of the National Commission on Childhood Disability, so if there are any questions on childhood SSI issues, I would be pleased to address those later as well. I will address the balance of my opening statement on welfare reform.
It was only 6 months ago that Congress passed and President Clinton signed comprehensive welfare reform legislation. Embodied in this legislation are four major reforms which promise to dramatically improve both the way we deliver assistance to low-income families and the well-being of children.
Page 67 PREV PAGE TOP OF DOC First, by ending the 61-year-old entitlement to cash welfare, welfare reform has given States both the flexibility and incentives for reducing caseloads.
Second, for the first time, the welfare reform legislation requires work in exchange for benefits.
Third, it provides incentives for reducing out-of-wedlock births.
And fourth, it takes great strides toward balancing child support enforcement with access and visitation rights of noncustodial fathers.
We are already seeing evidence that welfare reform is, in fact, working. Nationwide, caseloads fell by 10 percent between 1994 and 1996. In fact, by September 1996, the average State caseload had fallen by 16 percent, from its peak level in either 1994 or 1995.
Most promisingly, in those States that have been most aggressive in implementing through the Federal waiver process the kinds of reforms embodied in the welfare reform legislation, the decline has been more dramatic. In Wisconsin, caseloads have fallen by 37 percent. Michigan's caseloads have fallen for 32 consecutive months. And in all, 22 States have seen their caseloads drop by 20 percent or more.
But it is not just caseloads that are dropping. For the first time in 20 years, last year, we saw a decline in the number of children being born out of wedlock. There is evidence in New Jersey that welfare reform, and particularly the implementation of the family cap provision, is helping to cause some of this decline in out-of-wedlock childbearing.
Now, of course, one cannot state with absolute certainty that welfare reform is solely responsible for either the drop in caseloads we are seeing across the country or the reduction in the percentage of children being born out of wedlock, since the new legislation has not yet been fully implemented by State governments. But there is an emerging consensus that an important factor in both caseload reduction and the reduction in out-of-wedlock births is the fact that so much national and State attention has been paid to the proposed welfare reform legislation and particularly to the end of welfare as an open-ended entitlement that both current and potential welfare recipients are taking steps to avoid being on welfare.
Page 68 PREV PAGE TOP OF DOC Given these early indications of success, now is not the time to revise the welfare reform legislation. In fact, making changes in the welfare reform legislation now will send exactly the wrong signal. It will send the signal that we are not serious about welfare reform, that if enough people complain or if there are some episodic difficulties, what will happen is we will revisit the law and we will, in fact, reimplement the old welfare system.
What we need to do instead is to allow the recently enacted reforms time to work and to rigorously evaluate its impact on low-income children and families. To this end, I want to note and praise this Congress for having included in the welfare reform legislation a three-tiered system of evaluation of the new welfare reform legislation and its impact on low-income families and children. In fact, I think this Congress has not been given enough credit for putting into place a system that will allow us to determine whether negative impacts are starting to occur and at that time make changes in the legislation.
We do, as the President has commented on several occasions, need to build bridges to the 21st century. I think the President should have more confidence that this particular bridge has a sturdy foundation and resist the impulse to open up the welfare reform legislation before it has a chance to be fully implemented by the States.
[The prepared statement follows:]
Statement of Wade F. Horn, Ph.D., President, National Fatherhood Initiative
My name is Wade F. Horn, Ph.D. I am a child psychologist and President of the National Fatherhood Initiative, an organization whose mission is to improve the well-being of children by increasing the number of children growing up with an involved, responsible and loving father. Formerly, I served as Commissioner for Children, Youth and Families within the U.S. Department of Health and Human Services, and was a presidential appointee to the National Commission on Children. I also served as a member of the National Commission on Childhood Disability.
Page 69 PREV PAGE TOP OF DOC Barely six months ago, Congress passed, and President Clinton signed, comprehensive welfare reform, replacing the nation's principal cash assistance program, Aid to Families with Dependent Children (AFDC), with a new block grant to the states entitled Temporary Assistance for Needy Families (TANF). Embodied in this legislation are four major reforms that promise to dramatically improve both the way our nation provides assistance to low-income families and the well-being of children.
First, the welfare reform legislation ends the 61-year-old entitlement to cash welfare. Prior to reform, cash welfare was distributed to the states as an open-ended entitlement program. As such, states had very little incentive to reduce welfare caseloads, since doing so would result in decreased federal funding. The new welfare law eliminates this perverse incentive by creating a fixed block grant for the next five years. Within a block grant system, should states be successful in reducing caseloads, they will be able to keep any surplus federal funds resulting from the caseload reduction. These surplus funds can then be used for other efforts to aid low-income families.
In addition, the end to the entitlement to cash welfare means that individuals will no longer be able to view welfare as a lifestyle, but rather as a temporary assistance program to assist them in achieving self-sufficiency. As a result, fewer families and children will be trapped into long-term welfare dependency.
Second, for the first time, the welfare reform legislation requires work in exchange for benefits. When a family lacks a reliable wage earner, the family is likely to be poor. Data from the U.S. Census Bureau indicates that while 40 percent of the unemployed were poor in an average month in 1993, only 3.8 percent of full-time workers were poor.1 Poverty, in turn, is associated with poor developmental outcomes for children. A number of studies have found that children living within poor families are significantly more likely than non-poor children to develop emotional and behavioral problems,2 underachieve at school,3 and be poor themselves in adulthood.4
Page 70 PREV PAGE TOP OF DOC But absence of money is not the most important reason why poverty is associated with poor outcomes for children. Rather, it is welfare dependency that has the most deleterious effects on the well-being of children. For example, in a study of young boys growing up in families with identical non-welfare incomes, Mary Corcoran and her colleagues at the University of Michigan found that increases in extra income obtained through welfare were correlated with lower earnings by the boys upon reaching adulthood. In fact, an increase of $1,000 per year in welfare received by the family decreased a boy's future earnings by as much as 10 percent.5
Girls also are negatively affected by receipt of welfare. Recent research by economist John Pepper at the University of Wisconsin at Madison found that young women whose parents received AFDC were 25 percent more likely to be AFDC recipients themselves in adulthood, compared to young women who grew up in poor families that did not receive AFDC.6 Furthermore, research by Margaret E. Ensminger found that, after controlling for other early life conditions, women who grew up in families that received welfare, compared to those who did not, evidenced lower self-esteem and were significantly more likely to report psychological distress as a mother of a young child.7
Perhaps most alarming of all, welfare receipt, but not low-income alone, has been found to negatively affect a child's cognitive capacities. In an examination of the IQs of young children who were long-term welfare dependents, Anne Hill and June O'Neill of Queens College concluded: ''Although long-term welfare recipients are generally poor, persistent poverty does not seem to be the main reason for the poor performance of these children. Moreover, our analysis suggests that policies that would raise the income of children on welfare simply by increasing AFDC benefits are not likely to improve cognitive development.'' 8
Increasing the workforce attachment of an adult family member is likely to improve the well-being of children for several reasons. First, even at low wage levels, those who are working consistently can significantly improve the disposable income available to their families relative to welfare, while putting themselves in the best position to lift themselves and their families out of poverty. It is through working consistently that people develop the skills, habits, and contacts to find better jobs and better wages.
Page 71 PREV PAGE TOP OF DOC Second, when an adult welfare recipient gets a job it gives children an everyday model of work. This helps teach the child the behavioral skills necessary to get and keep a job, such as regularly and consistently getting up in the morning and going to work, and being courteous to one's employer. More important than skills, working parents pass along an attitude about work and self-support that is critical to avoiding dependency and povertythe attitude that adults should always strive to get their jobs done satisfactorily and stay employed, regardless of the obstacles they may face.
The welfare reform legislation requires that certain percentages of the welfare caseload must take private sector jobs, or if a private sector job is not available, perform community service work in exchange for benefits. When working in a community service job, the welfare recipient must be in a ''pay for performance'' system; that is, the welfare recipient cannot receive cash welfare until after the community service work is performed. Thus, the new welfare reform legislation, with its emphasis on work, brings the welfare system into line with the values held by most Americans that work is preferable to welfare and that families should be primarily responsible for the upbringing of their children. These reforms will also improve the well-being of children by increasing the likelihood that they will experience an everyday work model, and by ensuring that most, if not all, of the money available to the family is due to earnings rather than a hand out.
Third, the new welfare reform legislation provides incentives for reducing out-of-wedlock births. The two most frequent pathways to welfare are divorce and out-of-wedlock childbearing. Although the immediate result is the same (e.g., the formation of a single-parent family), the sequelae of divorce and out-of-wedlock childbearing are quite different. First, divorced mothers are far more likely to receive formal child support payments from the fathers than is the case for never married mothers. Second, divorced mothers spend substantially less time on welfare than never married mothers, primarily because they are more likely to remarry than women who bear children out-of-wedlock.
Page 72 PREV PAGE TOP OF DOC Unfortunately, the percentage of AFDC recipient children of non-married parents has risen steadily (from 27.9% in 1969, to 44.3% in 1983, to 55.7% in 1994). Indeed, out-of-wedlock childbearing is now the most common route onto welfare. Today, 56 percent of all AFDC recipients are never married mothers.9 African-American women on AFDC are particularly likely to be never married. In 1992, of the never married women on AFDC, 50.9% were African-American, 30.8% were white, and 13.6% were hispanic.10
These statistics imply that one of the most effective strategies for fighting long-term welfare dependency is to reduce the number of births to never married women. While divorce certainly has negative consequences for children, divorce is substantially less likely than an out-of-wedlock birth to lead to long-term welfare dependency. Hence, while there may be many good reasons to work toward reducing the divorce rate, reducing illegitimacy is far more important when it comes to reducing long-term welfare dependency.
The new welfare reform law combats out-of-wedlock pregnancies in several ways. First, it requires that each state set numeric goals for reducing out-of-wedlock births over the next ten years, thereby focusing the attention of state government on the problem. Second, the new law provides that beginning in 1999, $20 million in grants will be made available each year to states that, compared to the previous two-year period, reduce out-of-wedlock births while also decreasing the abortion rate. If fewer than five states qualify, those states that do qualify are eligible to receive $25 million each annually. Third, the new law provides $50 million in funding for abstinence education programs, which offer the best promise for reducing out-of-wedlock births.
Given the overwhelming empirical evidence that children born out-of-wedlock are at risk for a host of problematic developmental outcomes, reducing the number of children born out-of-wedlock must become a priority in every state. The new welfare reform law does just that, and in doing so promises to significantly improve the well-being of children.
Fourth, the new welfare reform law takes great strides toward balancing child support enforcement with access and visitation rights of non-custodial fathers. Living in poverty is highly correlated with living in a father absent household. According to research by Victor Fuchs and Diane Reklis, households with a father present have seen a steady rise in income from 1960 to 1990, while households without fathers have seen a decline in income from 1980 to 1990.11 Indeed, the median family income for a married couple is three times higher than it is for a single-mother family$40,000 a year versus $13,000 a year.12 In fact, 38.4 percent of divorced mothers and 66.3 percent of never married mothers, compared to only 10.6 percent of two-parent families, live in poverty.13
Page 73 PREV PAGE TOP OF DOC But poverty is not the only negative consequence of growing up without a father. Children who grow up without their fathers in the home are also more likely to fail at school or to drop out,14 experience behavioral or emotional problems requiring psychiatric treatment,15 engage in early sexual activity,16 and develop drug and alcohol problems.17
Children growing up with absent fathers are especially likely to experience violence. Males who grow up without fathers, compared to those who grow up with fathers in the home, are significantly more likely to commit rape,18 be charged as adolescents with murder,19 and be sentenced to juvenile reform institutions.20 Children who grow up without fathers are also significantly more likely to commit suicide as adolescents 21 and to be victims of child abuse or neglect.22
In light of these data, noted developmental psychologist Urie Bronfenbrenner has concluded: ''Controlling for factors such as low income, children growing up in [father absent] households are at a greater risk for experiencing a variety of behavioral and educational problems, including extremes of hyperactivity and withdrawal; lack of attentiveness in the classroom; difficulty in deferring gratification; impaired academic achievement; school misbehavior; absenteeism; dropping out; involvement in socially alienated peer groups, and the so-called 'teenage syndrome' of behaviors that tend to hang togethersmoking, drinking, early and frequent sexual experience, and in the more extreme cases, drugs, suicide, vandalism, violence, and criminal acts.'' 23
Despite the clear connection between father absence and poor outcomes for children, the old welfare system was extremely hostile to father presence. Beginning in 1950, when Title IVA was amended to require that eligibility workers get information from mothers about deserting fathers and give this information to the local district attorney, the fathers' role in welfare has been mostly about paternity establishment and child support enforcement. This is not, of course, without merit. Any man who fathers a child ought to be held financially responsible for that child. But as important as paternity establishment and child support enforcement may be, they are by themselves unlikely to substantially improve the well-being of children for several reasons.
Page 74 PREV PAGE TOP OF DOC First, paternity does not equal child support. In fact, only one in four single women with children living below the poverty line receive any child support from the non-custodial father.24 Some unwed fathers, especially in low-income communities, may lack the financial resources to provide economically for their children. For these men, establishing paternity and a child support order may not translate into economic support for the child (although studies show the average child on AFDC has a father who earns an annual income of approximately $15,000, indicating some ability to pay child support 25).
Second, if paternity establishment led to a child support award, the average level of child support (about $3000 per year 26) is unlikely to move large numbers of children out of poverty. Some may move out of poverty at the margins. But moving from poverty to near poverty is not associated with significant improvements in child outcomes,27 absent changes in family structure or workforce attachment.
Third, an exclusive emphasis on child support enforcement may only drive these men farther away from their children. As word circulates within low-income communities that cooperating with paternity establishment but failing to comply with child support orders may result in imprisonment or revocation of one's driver's license, many may simply choose to become less involved with their children. Thus, the unintended consequence of such policies may be to decrease, not increase, the number of children growing up with fathers, proving once again that no good policy goes unpunished.
To make matters worse, federal rules have been operating to make it more, not less, difficult for fathers to be in the home. First, the 100 hour rule in the AFDC-Unemployed Parent (AFDCUP) Program dictated that a two-parent family, but not a single-parent family, lost eligibility for cash welfare if the principal wage earner was employed for 100 hours a month or more, even if the family's wages from employment were so low that the family would still be financially eligible for cash welfare. Second, AFDCUP Program rules did not allow a two-parent family to receive aid until 30 days after the principal wage earner had become unemployed, a waiting period that was not required for single parent households. Third, the AFDCUP Program rules required that two-parent families, but not single parent families, demonstrate a ''connection to the work force,'' typically defined as having had at least $50 of earnings in at least 6 of 13 quarters ending within a year before applying for cash welfare, before being declared eligible for benefits.
Page 75 PREV PAGE TOP OF DOC The new welfare law offers hope for renewing fatherhood in several ways. First, it provides states with the flexibility to eliminate many of the onerous federal welfare rules which have been operating to push fathers to the periphery of families. Indeed, a significant number of states have already eliminated many of these anti-father rulesespecially the 100 hour rulethrough the federal waiver process. Now that a federal waiver is no longer required to alter these rules, every state that has not yet done so has the flexibility to change these rules.
Second, the new welfare legislation provides entitlement money to ensure greater access and visitation of non-custodial fathers. These funds will go a long way toward communicating that good fathers not only provide financial support, but are also engaged in the lives of their children as nurturers, disciplinarians, mentors, moral instructors and skill coaches.
Finally, the new law toughens child support enforcement mechanisms to ensure that non-custodial parents, at a minimum, do fulfill their financial obligations to their children.
PROGRESS TO DATE
We are already seeing evidence that welfare reform is working. Nationwide, caseloads fell by 10 percent between 1994 and 1996. In fact, by September of 1996, the average state caseload had fallen by 16 percent from its peak level in either 1994 or 1995.
In those states that have been most aggressive in implementing, through the federal waiver process, reforms embodied in TANF, the decline in welfare caseloads has been even more dramatic. In Wisconsin, for example, caseloads fell by 37 percent. Michigan's caseloads have fallen for 32 consecutive months. In all, twenty-two states have seen their caseloads drop by 20 percent or more.
It is not only caseloads that are dropping; for the first time in twenty years, the percentage of children born out-of-wedlock birth in 1995 decreased rather than increased. There is evidence from New Jersey that welfare reform, and particularly the implementation of a family cap provision denying additional cash benefits to women who conceived an additional child while on welfare, is helping to cause some of this drop in out-of-wedlock births. In New Jersey, births to mothers on AFDC statewide declined by 4 percent between 1992 and 1994, compared to a 1.9 percent decline in births to all mothers statewide. This post-reform decline contrasts sharply with a 4.9 percent increase in births to mothers on AFDC over the year preceding discussion of the family cap, when birth rates to all mothers statewide were declining by 1.3 percent. Interestingly, AFDC birth rates declined more significantly in areas of the state where AFDC recipients were most highly concentrated. Between 1992 and 1994, the ten New Jersey cities with the highest AFDC recipiency rates saw birth rates to mothers on AFDC drop 8.5 percent. The largest city, Newark, experienced a decline of 10.4% in births to mothers on AFDC. The state's most welfare-dependent city, Camden, saw a startling 21.2 percent decline in births to mothers on AFDC.28
Page 76 PREV PAGE TOP OF DOC One cannot, of course, state with certainty that welfare reform is solely responsible for the drop in caseloads or the recent reductions in the percentage of children being born out-of-wedlock, especially since the new welfare reform legislation has not yet been fully enacted by state governments. Nevertheless, there is an emerging consensus that an important factor in both the drop in caseloads and reductions in out-of-wedlock births is the fact that so much national and state attention has been paid to the proposed welfare reform legislation, and particularly the end to welfare as an time unlimited entitlement, that both current and potential welfare recipients are taking steps to get off welfare. For example, in a focus group interview with Rutgers University researchers, one woman stated, ''They gonna try to cut welfare off, try to get people working. You can't have more than two children and receive welfare.'' Another stated, ''You should use your head because the system is not going to always be there for you.''
RESISTING STAGE FRIGHT
Given these early indications of success, now is not the time to revise the welfare reform legislation. Rather, we need to give the recently enacted reforms time to work, and to rigorously evaluate its impacts on low-income children and families.
In fact, the recently enacted welfare reform legislation includes several provisions that will provide such rigorous evaluation data. First, the statute requires states to report on a host of outcome variables, including information on out-of-wedlock birth rates. Second, for each of the next six years $15 million is provided to the Secretary of the U.S. Department of Health and Human Services for evaluations of innovative state reforms. Third, for each of the next six years $10 million in entitlement money is provided to the U.S. Bureau of the Census to use the Survey of Income and Program Participation (SIPP) sample to evaluate the impact of welfare reform. The latter will allow the federal government to trace the impact of welfare on a nationally representative sample of low-income families, including its impact on marriage rates. Thus, there are provisions in the welfare reform legislation which will provide a feedback mechanism to ensure that if welfare reform is not having its intended positive effects, changes can then be made. In fact, the Republican Congress has not been given the credit they deserve for ensuring that there will be sufficient funding to evaluate the effects of welfare reform.
Page 77 PREV PAGE TOP OF DOC
Congress made a giant leap forward in combating the terrible scourge of welfare dependency when it enacted, just six months ago, comprehensive welfare reform legislation. In emphasizing temporary assistance, work, marriage, and fatherhood, the new welfare reform law promises to significantly improve the way we provide assistance to low-income families, and in doing so, improve the well-being of children.
We do, as the President commented not too long ago, need to build bridges to the 21st century. The President should have more confidence that this bridge has a sturdy foundation, and resist the impulse to open up the welfare reform legislation before it has even been fully implemented by the states.
I thank you for the opportunity to provide you with this testimony in support of this important legislation, and would be pleased to answer any questions you might have concerning my testimony.
INSERT OFFSET FOLIOS 3 TO 4 HERE
[The official Committee record contains additional material here.]
Chairman SHAW. Thank you, Dr. Horn.
STATEMENT OF ROBERT RECTOR, SENIOR POLICY ANALYST, HERITAGE FOUNDATION, WASHINGTON, DC
Mr. RECTOR. Thank you, Mr. Chairman. I wish to commend this Subcommittee for the very hard work you have done over the last 2 years on behalf of welfare recipients and the taxpayers and particularly to commend you, Mr. Chairman, for your very steadfast activities in achieving reform.
Page 78 PREV PAGE TOP OF DOC In 1996, the U.S. Federal Government was running over 70 major means tested welfare programs. Total spending on means tested welfare last year amounted to $404 billion. This comprised 5.3 percent of gross domestic product, a record historic high. Total spending on children's programs under this aggregate spending figure amounted to $9,000 for every child in a family with an income below 150 percent of poverty.
Having achieved a historic high record level of welfare spending last year, President Clinton has come back in his budget and proposed to increase aggregate means-tested spending by 5 percent per annum for the next 6 years. That is twice the rate of inflation. Under the President's proposed budget, the Federal Government will spend over $2 trillion over the next 6 years on means tested welfare. That amounts to $20,000 per tax-paying family in the United States, a pretty interesting concept of ending welfare as we know it.
By the year 2002, Federal and State means tested welfare spending under the President's proposal would exceed $500 billion per annum. At that point, the United States would be spending $2 on welfare for every single dollar we spend on national defense. Yet, somehow, no matter how much we increase spending, as we have over the last 30 years, having spent more and more and more each and every year, no matter how much we spend, some people come back and say, It is not enough. We must spend more.
As you know, one of the fastest growing groups of recipients in the welfare system has been immigrants. Over the last 13 years, the number of noncitizens on SSI has increased by 613 percent, and we have close to 800,000 of those individuals on SSI at the present time. Basically, the Congress has been operating a deluxe retirement system for the elderly from the Third World who are coming here and retiring at the expense of the American taxpayer. Most of these individuals are, in fact, deportable under existing law. Let me emphasize that. They are deportable. What we are proposing here is not to deport them but simply to say, You can no longer come here and become a burden to the taxpayer.
Page 79 PREV PAGE TOP OF DOC Over and over again, the Congress of the United States has chosen to raise taxes on the average American taxpayer in order to, in part, allow for more and more people to come here from other countries and retire on welfare, and I find that outrageous.
If we look at the existing system and take the current rate of growth of noncitizens on SSI, we find the cost to the taxpayer over the next 10 years would be $320 billion. If you assume a lower rate of growth under the old law of 7 percent per annum, which is what CBO assumes, the cost over the next 10 years will be $184 billion.
But those figures are both very low because they do not include aliens who have naturalized and still remain on SSI. If you throw those in, we are clearly talking about, under the old system, costs of between $0.5 and $1 trillion for elderly immigrants to come to the United States and retire on welfare over the next 20 years. By Washington standards, that is real money.
The reforms that have been put in place with the law that was enacted last year are very good reforms, but they are going to only hit the margin of these costs. The reason for that is that there is a gaping loophole in it, which is that these individuals can naturalize and become citizens and then they become automatically eligible for all U.S. welfare.
What we need to do in order to control these costs over the next 20 years are three things. First of all, no Federal funds, including Medicaid, should be available to noncitizens who have living sponsors.
Two, we should require as a condition of naturalizationand this would have to be done in a separate Committeeas a condition of naturalization, 5 years of prior employment before someone naturalizes.
Three, in the future, when elderly and near-elderly people come into the United States, they should be admitted as a guest resident without the option of naturalizing. Their sponsors should not only be deemed for their income but they should be required to post bond to assure these people will not become burdens on the American taxpayer.
Page 80 PREV PAGE TOP OF DOC In conclusion, I would say that a lot of the problems we are looking at today are the result of 15 and 20 years ago, Members of Congress on this Subcommittee and other Committees making it easy for people to come here and retire on welfare, to migrate here and retire on welfare. You are trying to clean up bad mistakes that were made 15 years ago. I think it is very important that today we make the changes that are necessary in this Subcommittee and others so that 15 years from now, we will not be looking at an even larger problem. I thank you.
[The prepared statement follows:]
Statement of Robert Rector, Senior Policy Analyst
I would like to thank this committee for giving me an opportunity to discuss the growth of the welfare state and in particular the issue of immigration and its burden on the American taxpayer.
The federal government currently runs over 70 means-tested welfare programs, providing cash, food, housing, medical care and social services to poor and low income Americans. In 1996 federal and state spending on these programs reached over $400 billion, an historic high equaling 5.3 percent of GDP.
Despite political promises to ''end welfare,'' the Clinton budget proposes to increase federal means-tested welfare spending at five percent per year, twice the rate of inflation. President Clinton is proposing spending nearly $2 trillion on federal means-tested welfare over the next six years roughly $20,000 for every taxpaying family in the U.S.
By 2002 combined federal and state welfare spending will equal nearly $500 billion; at that point, the nation will be spending almost two dollars on welfare for each dollar spent on national defense.
The fastest growing population of welfare recipients has been elderly non-citizens. The United States welfare system is rapidly becoming a deluxe retirement home for the elderly of other countries. This is because many individuals are now immigrating to the United States in order to obtain generous welfare that far exceeds programs available in their country of origin.
Page 81 PREV PAGE TOP OF DOC In 1995, there were 785,410 lawful non-citizen residents receiving aid from the Supplemental Security Insurance (SSI) Program. This was up from 127,900 in 1982a 613 percent increase in 13 years. The majority of non-citizen SSI recipients are elderly. Most apply for welfare within five years of arriving in the United States.
One in three seniors on SSI is now a non-citizen, and half of benefits to seniors in the program go to non-citizens. The case for the badly needed reform of SSI and Medicaid enacted last year is dramatic and obvious:
Without reform, the U.S. would have had more than three million non-citizens on SSI within ten years, if recent growth trends in caseload had continued. Without reform, the total cost of SSI and Medicaid benefits for non-citizen immigrants would have amounted to over $320 billion over the next ten years. Annual SSI and Medicaid benefits for these individuals would have reached over $64 billion per year in 2006 (see Table 1).
Even with the implausible assumption that the number of immigrants receiving benefits would have remained at current levels without any future growth, the future cost would have been staggering. In the absence of reform, U.S. taxpayers would have been forced to pay a minimum of $113 billion over the next ten years for SSI and Medicaid benefits for resident aliens (see Table 2).
The welfare reform legislation enacted last year was a significant step toward reducing these future costs. However, this legislation must be greatly strengthened, not weakened as President Clinton is now proposing.
WELFARE AS A RETIREMENT HOME FOR THE THIRD WORLD
The data show that welfare is becoming a way of life for elderly immigrants. An analysis of elderly immigrants in California by Professor Norman Matloff of the University of California at Davis shows that 45 percent received cash welfare in 1990. Among Russian immigrants, the figure is 66 percent; among Chinese, 55 percent. Worse, the trend is accelerating. Recent immigrants are far more likely to become welfare dependents than those who arrived in the United States in earlier decades.(see footnote 3)
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Congressional testimony by Dr. Matloff demonstrates that immigrants have a high degree of awareness of welfare policies and procedures. Besides word of mouth among immigrants, sources in foreign countries as well as the United States give advice on how to obtain welfare benefits. For example, Zai Meiguo Sheng Huo Xu Zhi (What You Need to Know About Life in America), a publication sold in Taiwan and Hong Kong, and in Chinese bookstores in the U.S., includes a 36-page guide to SSI and other welfare benefits. The largest-circulation Chinese-language newspaper in the U.S., Shijie Ribao (World Journal), runs a regular ''Dear Abby''-style advice column on SSI and other immigration-related matters.(see footnote 4)
Prudent restrictions on providing welfare to recent immigrants long has been part of the American tradition. Becoming a charge was grounds for deportation in the Massachusetts Bay colony even before the American Revolution. America's first immigration law, passed by Congress in 1882, prohibited the entry of paupers and persons who were likely to become a public charge. Similar restrictions have appeared in subsequent immigration law. Today, the Immigration and Nationality Act declares unequivocally: ''any alien who, within five years after the date of entry, has become a public charge from causes not affirmatively shown to have arisen since entry is deportable.'' But this provision of the law has been utterly ignored.
The presence of large numbers of elderly immigrants on welfare is a violation of the spirit, and arguably the letter, of U.S. immigration law. The relatives who sponsored the entry of these individuals into the U.S. implicitly promised that the new immigrants would not become a burden to the U.S. taxpayer. But many, if not most, sponsors enrolled their elderly immigrant relatives on welfare soon after the end of the three-year waiting period. Once on SSI, these immigrants would have remained on welfare indefinitely.
Page 83 PREV PAGE TOP OF DOC Although many of the elderly non-citizens on SSI come from politically oppressive nations such as Cuba or the former Soviet Union, the majority do not. The single greatest number of aliens on SSI come from Mexico. Other nations, such as the Dominican Republic, India, South Korea, and the Philippines, also contribute large numbers of recipients.
INSERT OFFSET FOLIOS 5 TO 7 HERE
[The official Committee record contains additional material here.]
Most non-citizens on SSI lawfully admitted to the U.S. have relatives capable of supporting them. To have brought a relative to the U.S. in the first place, the sponsor must have demonstrated a capacity to support that relative. And most sponsors do, in fact, support their immigrant relatives for at least three years after their arrival. When SSI benefits for non-citizens are terminated, in most cases the family support which sustained the immigrant immediately after arrival in the U.S. simply will be resumed.
Just as Americans expect an absent parent to pay child support for his children, so they also must expect individuals who voluntarily have brought elderly and near-elderly relatives to the U.S. to support those relatives fully. This obligation to support should be permanent. Under no circumstances should the cost of supporting elderly and near-elderly immigrants to the United States be passed to the general taxpayer.
POLICY RECOMMENDATIONS ON NONCITIZENS
Immigration should be open to a limited number of individuals who wish to come to the United States to work and be self sufficient and who clearly have the capacity to support themselves. America should open its doors to those who have skills and seek opportunity. But immigration should not become an avenue to welfare dependence. Any advanced welfare state will place great strains on its taxpayers if it encourages the immigration of large numbers of elderly, near elderly, and low-skilled persons.
Page 84 PREV PAGE TOP OF DOC The welfare reform legislation enacted last year took important steps to the limit the abuse of the welfare system by non-citizens. The new law creates the following rules:
current resident non-citizens may not receive SSI or Food Stamps;
refugees, asylees and veterans are excepted from this ban;
states have option of providing AFDC block grant funds and Medicaid funds to current resident non-citizens;
all barriers to welfare are abolished upon naturalization, naturalized immigrants automatically obtain the same eligibility to welfare programs as other citizens.
The needed savings to the taxpayers from the reform legislation have been greatly eroded by obvious loopholes: the most important being that once the elderly immigrant becomes a citizen, there is no lawful way to keep him or her off SSI, Medicaid or any other welfare program. And once the elderly immigrant has become a citizen, there is no lawful means to require the sponsor to provide health insurance or to defer welfare costs. Thus, the only real mechanism for reducing the growth in the number of elderly immigrants on welfare is to reduce the number of such immigrants who enter the U.S. with the option of eventually becoming citizens.
I recommend the following policy changes to address this problem:
1) Immigration law should be changed immediately to require a certain minimum number of years of paid employment in the U.S. as a pre-condition of naturalization for non-citizens, including current residents. (Certain obvious exceptions to this rule should be allowed, such as: veterans, spouses of citizens, and children of citizens.)
2) In the future elderly and near elderly non-citizens should be allowed to enter the country only as resident quests without the option of naturalizing. Sponsors of such entrants should be required to post bond against any future costs to the government incurred by the elderly entrant.
3) If a current resident non-citizen had a sponsor at the time of entry, no federal funds should be used to provide Medicaid or other aid to without deeming and reimbursement provisions being applied to such original sponsor.
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IMPACT OF REAL REFORM ON AFDC DEPENDENCE
Finally, there is a common misconception promoted by President Clinton and others that the reform legislation enacted last year will leave state governments facing a shortage of funds. This is utterly untrue. Indeed states which establish serious work requirements for welfare recipients will immediately produce large reductions in welfare dependence and will generate surpluses in welfare funds. For example, work requirements established in the state of Wisconsin have already reduced its AFDC caseload by 55 percent. In 28 of Wisconsin's 77 counties the AFDC caseload has already dropped by 80 percent or more. Even in inner city Milwaukee the caseload has been cut by 30 percent. And, at present, the caseload continues to drop at an astonishing two percent per month in Milwaukee and four percent per month in the rest of the state. Similar declines in welfare dependence are occurring in Oregon.
These states have shown that dependency can by dramatically reduced. Other states that are willing to end welfare as a one way hand out, and to implement serious work programs of the sort already in place in Wisconsin, will achieve similar dramatic results. The welfare reform legislation enacted last year sets the stage for serious reform; that legislation must be strengthened, not undermined.
Chairman SHAW. Thank you, Mr. Rector.
STATEMENT OF SHARON M. DALY, DEPUTY TO THE PRESIDENT FOR SOCIAL POLICY, CATHOLIC CHARITIES USA, ALEXANDRIA, VIRGINIA
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Ms. DALY. Thank you very much for the invitation to testify today. We at Catholic Charities always appreciate your courtesy, especially in light of the fact that we often have different views.
I would like to just point out that Catholic Charities USA is the national social services network of the Catholic Church, has an affiliation of 1,400 local independent nonprofit agencies and institutions that serve 11 million people a year. Catholic Charities USA represents the views and decades of experience of more than 300,000 staff members and volunteers.
As you know, Mr. Chairman, we have had some criticisms of last year's bill, but this afternoon, I want to focus only on two areas where I believe there is substantial support from Governors, mayors, religious groups, and nonprofit social services providers. We are not here to suggest reopening the bill or returning to the old system but to fine-tune the legislation that was passed.
However, I was just putting together Mr. Horn's views and Mr. Rector's views. Mr. Rector points out that last year, we spent more money on welfare in this country than at any time in history, and Mr. Horn points out that caseloads for AFDC are plummeting all over the country, falling like a rock. Maybe we were doing something right before the welfare bill passed. Maybe we should look at that combination. I think Mr. Rector is right. We spent more than ever before, but what we were getting were falling caseloads, notas you well know, the falling caseloads cannot be attributed to a bill that is only now becoming effective.
I want to talk first about work and jobs. Our local agencies are beginning to see an increase in hunger and homelessness among families that have been denied assistance or had their assistance cut because of previous waivers and because the new bill is just implemented. Our agencies have been very concerned because they are beginning to see folks come in to their agencies without any resources to survive.
Page 87 PREV PAGE TOP OF DOC Now, we have been trying to make the bill work. Even though we were critical, our agencies have been finding jobs for people. They have been creating day care slots. They have been increasing job readiness and placement programs and reaching out to businesses and corporations to find jobs for the people who are going to hit the work requirements and time limits.
In fact, we may be having a little better luck than the President. the New York Times points out today that the effort to reach out to big corporations has produced only a few hundred jobs. Our program in Chicago, the Carr Program, creates more than 100 jobs every year for welfare recipients who get intensive services. Working with 100 employers in Chicago and 10 community colleges, 300 of our graduates are getting starting salaries of $9,000 to $28,000 with an average of $15,000.
Our programs, of course, give people 2 years of counseling, education, training, and substance abuse treatment before we turn to job placement; and, of course, it is very doubtful that very many people under the new welfare bill will be able to get those services.
We are very proud of our record, but we also recognize that employers only hire the workers they need. While the economy has been very strong in the past few years and more jobs have been created and the welfare rolls have dropped, as they always do in good economic times, we have to wonder what will happen as the economy has to cope now with 3 to 5 million more additional people who have to work under the welfare bill.
I was thinking about the water here. We have been getting these people placed. Lots of folks are finding jobs. There is a lot of good news out there. But this is the number of people who are going to have to get jobs because of the work requirements and the time limits, and here are the jobs that are available. So we sew them up and at some point, you splash out the rest of the water all over the floor and what that water is are children and families where the parents do not get jobs, but they have hit the time limits and the work requirements.
What I want to talk to you about today is how do we prepare for that, because that time is coming. We are already seeing it, in fact. In a shelter in Milwaukee, Wisconsinwe just heard about the wonderful, wonderful success in Milwaukeewe now have 338 people who are being sheltered and turned away 465 more. Last year, they only had to turn away 65 people. Clearly, lots of folks who have been sanctioned under the new welfare rules in Wisconsin are not finding jobs. They are being evicted and winding up in shelters. I am sure you agree that is not a good solution.
Page 88 PREV PAGE TOP OF DOC We need to create more jobs, and we are pretty critical of the administration's proposal. We are not sure this tax credit scheme is going to really create additional jobs, and we do not think that just funding for job placement is enough if we do not create jobs. We hope this Subcommittee will look seriously at how do we create additional jobs for all these people who are going to have to go to work.
We do not oppose requiring them to work. We have never objected to that. But the point is, at some point, the available jobs are going to be gone, and you are still going to have millions of people who now have no way to support themselves and the Subcommittee needs to be preparing for that and looking for ways to do it.
Mr. Hayworth said he was looking to the nonprofit community for how to solve this problem. I would like to call your attention, Mr. Hayworth and the rest of the Subcommittee, to a chart that is appended to my testimony. It shows the amount of cuts in the entitlement programs, the means tested entitlements in last year's welfare bill, and then all private service giving, human service giving in 1995this is yearly, 1-year cutsthere is the whole United Way and all of Catholic Charities.
You know how the United Way, I am sure they come after you, they work really hard, they raise all that money, all together, they only raised a little over $3 billion in the whole country. We only raised $2 billion in the whole country. If you put the whole private sector together, even if Diana and I raise all the money we possibly can, it will not be a drop in the bucket compared to what was cut last year and we need to be prepared for that.
We are very concerned about the plight of refugees, asylees, and other immigrants who are about to lose their benefits. We, frankly, think we are going to have a rash of suicides. There are a lot of very old, very sick people who do not have sponsors, who do not have friends or relatives to take care of them. They just live on those SSI checks and food stamp benefits and they buy their high blood pressure medicine with their Medicaid cards, and what are they going to do when the SSI no longer comes and the food stamps no longer come and they have no Medicaid? We are not going to be able to support them.
Page 89 PREV PAGE TOP OF DOC Many of these people came out of Cambodia, Laos, and Vietnam after being tortured and suffering in refugee camps. They came to this country and were not really able to pass the citizenship test because they took a long time to learn the language and then developed many disabilities, especially mental disabilities. I think, Mr. Chairman, if any of us had spent time in those refugee camps or crawled across the killing fields, across skulls and skeletons and knew that our families had been lost, that we might have had a little harder time adjusting to life in the United States, as well. We might have mental illness and might not be able to become citizens in time and might not be able to support ourselves.
Those are the people we are worried about, and we think that the administration's proposals to restore SSI benefits and food stamp benefits to people who became disabled after they entered this country are critically important, and we hope you will look at that very seriously. These are people who we cannot expect to work. I have no problem with holding sponsors responsible. Lots of these folks do not have sponsors. They do not have families, as Mr. Levin was pointing out. I know it was not your intention to leave these people destitute, and I hope we can work together to figure out how to restore their benefits.
In closing, attached to my testimony are some case studies. These are all real people, about a dozen people, real people who have been collecting SSI, food stamps, and Medicaid, and that is the only reason they are alive. The question now is, What will happen to them when they are no longer able to get those benefits and they have no one else to help them? I think the Federal Government cannot turn its back. Thank you.
[The prepared statement and attachments follow:]
Statement of Sharon M. Daly, Catholic Charities USA
We at Catholic Charities USA appreciate the Subcommittee's invitation to comment on the Administration's budget proposal with respect to welfare reform.
Page 90 PREV PAGE TOP OF DOC Catholic Charities USA is the national social services network of the Catholic Church. As an affiliation of 1,400 local independent nonprofit agencies and institutions that serve nearly 11 million people each year, Catholic Charities USA represents the views and decades of experience of more than 300,000 staff member and volunteers.
Our local member agencies are reporting to us about some of the early effects of welfare changes in their communities. Despite the picture painted of millions of former recipients leaving welfare, the scenario is far from rosy. In states where large numbers of families have been sanctioned or dropped from the rolls, the consequences have been devastating.
In Milwaukee, Wisconsin, for example, the homeless shelters are full of families with children who are there because they were among the one-fifth of the county welfare recipients who lost welfare benefits beginning last summer and fall.
One family shelter, Hope House, sheltered 338 people in the last quarter and had to turn away 465 more. More and more families are being turned away because neither jobs nor day care nor welfare benefits are available to the current residents. A year earlier, only 65 people (as opposed to the 465 this year) had to be turned away. Now, the length of time that it takes families to get on their feet, obtain housing, and leave the shelter has almost tripled.
In Sacramento California, as well as in scores of other communities, requests for emergency assistance from our food banks went up 25 percent in January alonepartly because of elimination of benefits for immigrants and partly because more American citizens (individuals and families) are receiving reduced benefits.
We recognize that this Congress wants to keep on track the legislation passed last year and to postpone any major changes until the effects of the changes can be studied. On the other hand, there are some specific changes that Congress can and should make; (1) to ensure that welfare reform has the best chance to succeed, and (2) to prevent unintended consequences of some of the new law's provisions.
Page 91 PREV PAGE TOP OF DOC First, making welfare reform work. As you know, moving welfare recipients from welfare to work is far more than a matter of motivation. You have provided extra motivation and compulsion though work requirements and time limits. The United States economy, which has been exceptionally strong, has enabled millions of parents on welfare to find jobs in the paid labor force who would otherwise have had to apply for or remain on welfare. In our experience, however, this development has not been an unqualified success, since many of these families are living well below the poverty level and depending more and more on churches and charities for the basics of human survival; food, housing, clothing, medicine. The combination of low wages, no benefits, high housing costs, and the need to pay out of pocket for day care and medical care is leaving many working parents and children in steadily deteriorating conditions.
Those at the bottom of the labor market hope that their good hard work and increasing experience will lead to higher wages, but the prospects for pay increases are dimming as millions of welfare and food stamp recipients are pushed into the labor market to compete with existing workers. Unfortunately, the costs of food, housing, transportation, child care, and medical care are not going to stagnate along with their wages.
There is not much detail yet on the Administration's proposals to create jobs and encourage employers to hire welfare recipients. We are not experts on employer tax credits, but past experience does not make us optimistic about such a direction. We hope that this Subcommittee can work with the Administration to ensure that any federal investment will actually increase the total number of jobs. It makes no sense to spend hundreds of millions of dollars to subsidize employers for jobs they would have filled anyway or to hire people on welfare as opposed to other disadvantaged working poor folks who have not been on welfare recently.
There has been a lot of discussion recently about solving the jobs problem by having the churches and nonprofits hire welfare recipients. Speaking only for our agencies, we have always hired people from the welfare rolls, but it seems unlikely that we will have the resources to create many additional jobs without a significant investment by the federal government. We hope that this Subcommittee will improve the Administration's welfare-to-work proposal to ensure that the new funding is targeted to the areas where it can best be used. We believe that the religious community and other nonprofit social services groups are making a sincere effort to make the new law successful, despite earlier predictions of disaster. But the need for resources is of a much greater magnitude than can be assembled by the nonprofits. Appended to our testimony is a chart comparing the cuts in the welfare bill to the total resources of Catholic Charities USA member agencies and the combined revenues of all United Way agencies.
Page 92 PREV PAGE TOP OF DOC With the help of corporations and local businesses, our agencies have had great success in job readiness and placement programs, but there are simply not enough jobs for all those who will be required to work under the new law.
With regard to benefits for immigrants, we recognize that a full restoration of the previous law is very unlikely, but the Congress should act favorably on the Administration's proposals to provide cash and medical assistance to those legal immigrants who cannot be expected to work, and whose families and sponsors have died, cannot be found, or are themselves unemployed or seriously ill.
One of our greatest fears is that the United States will have a rash of suicides among the very old and disabled immigrants who are left without any source of income or medical care.
Our agencies in Florida report that tens of thousands of elderly and disabled legal immigrants are on the verge of destitution. Many of these good people came from Cuba, worked hard, and raised families, but did not become citizens because they lived for the day that Castro would be overturned and they could return to their homeland.
Now, they are too old and too sick (from strokes, Alzheimer's, cancer, mental problems, etc.) to pass the language and citizenship tests. Many older women cannot qualify for the exemption for immigrants who have worked in the United States for 40 quarters because they were only able to work for six or seven years after raising their children. Widowed, impoverished, and sick, they cannot depend, long-term, on their children who are struggling to raise families of their own. Although many have families who can and do provide some financial and other support, very few can rely on others, month after month, year after year, for income, housing, food and medical care.
In California, our agencies report that immigrants, who worked for decades as farm laborers, are discovering that their former employers did not forward to the IRS the Social Security and other taxes deducted year after year from their wages. The same is true for domestic workers who cleaned toilets for 10 or 15 years only to find that their employers had not complied with the law, and there is no record of their many quarters of employment. These folks are twice victimized first by their employers, now by the new law.
Page 93 PREV PAGE TOP OF DOC While the new law exempts refugees and asylees from the bar on SSI and other benefits, it does so for only five years. The Administration proposes to raise that to seven yeas before benefits are cut off. On its face, that sounds quite reasonable until you think about the refugees, who like the Cubans, delayed applying for citizenship in the futile hope for a democratic government in their homelands.
Now our agencies are reporting to us about clients who have become disabled since admission to the United States or just grew too old to be employable. They are simply unable to retain information from citizenship or language classes. Advanced age and physical and mental impairments keep them from passing the tests. Those suffering from mental illness are especially tragic. Imagine for a moment how any of us would cope if, like some of our clients, we had come to the United States after months or years in a refugee camp, agonizing over the unknown fate of the whole family left behind to the tender mercies of communist guerrillas. Would our mental stability be threatened if we had crawled over skulls and skeletons to escape from the killing fields of Southeast Asia?
If we had lost everything family, property, friends, profession, health when we escaped from terror and oppression, would we be able to learn a new language, history, government, and culture to become United States citizens in only five years, or even seven years?
We see many refugees who enter the United States full of hope and energy and determination to succeed, but after a few years, the combined effect of the earlier torture, hunger, fear, and despair debilitates them mentally and physically. These people have come to the United States in good faith, fully intending to become self-supporting citizens, but, through no fault of their own, they can become neither.
I do not believe that this Subcommittee or the 104th Congress intended to abandon such individuals. It is one thing to enforce sponsors' responsibilities; it is quite another to turn our backs on severely disabled human beings who have no families or sponsors to support them.
Page 94 PREV PAGE TOP OF DOC Appended to this testimony are brief portraits of Catholic Charities clients who are faced with the loss of all benefitsSSI, Medicaid, AFDC and food stampsif the new law is not modified. We hope you will take the time to read these very brief case histories and to reflect on the wisdom of abandoning them and other like them.
INSERT OFFSET FOLIOS 8 TO 25 HERE
[The official Committee record contains additional material here.]
Chairman SHAW. Ms. Aviv.
STATEMENT OF DIANA AVIV, ASSOCIATE EXECUTIVE VICE PRESIDENT FOR PUBLIC POLICY, COUNCIL OF JEWISH FEDERATIONS, WASHINGTON, DC
Ms. AVIV. Mr. Chairman, thank you for the opportunity to testify before you today and to comment on the administration's budget proposal as it pertains to refugees, asylees, and legal immigrants impacted by the welfare statute.
The Council of Jewish Federations, my organization, is the national association of 180 local Jewish Federations which support thousands of health and social service programs nationwide. We note your commitment not to amend the welfare reform statute at this time in order to give time for the reforms to work. It is our view that it is not inconsistent with this commitment, however, to recognize that major social policy reforms often produce outcomes for certain classes of individuals that were not intended and are sufficiently damaging to warrant some adjustments.
Page 95 PREV PAGE TOP OF DOC We have concluded that some of the provisions of the welfare statute will result in certain legal immigrants, refugees, and asylees not being able to meet their basic health, nutritional, and housing needs. We are very concerned with legal immigrants and refugees whose families are not able to provide for their basic living needs. We are also concerned about the burden placed on nursing homes, including those receiving Medicaid reimbursement, assisted living facilities, hospitals, and other facilities for a burden they will not be able to carry. We also worry about those currently living independently in the community without the benefit of any assistance from our institutions who may turn to our institutions for the first time once they lose their food stamps and their SSI.
One of the groups of legal immigrants we are most concerned about are people who have become disabled after entering the United States. In the course of life, unanticipated illness, accidents, and violence can incapacitate any one of us. Where health crises or advanced age prevents employment, it may become impossible for them to meet some of their obligations, their basic obligations.
One such example is a client of ours, Bella, a 90-year-old Russian Jewish woman who immigrated to the United States with her daughter in 1979 as a legal immigrant, before the Refugee Act. She came to the United States because of threats to her and her property. Since living in the United States, she lived independently and cared for herself until about 1 1/2 years ago when she was diagnosed with Alzheimer's and paranoia. She is now incapable of taking care of herself. Even though qualified, she would not be able to naturalize. Her daughter is willing to take care of her, but she cannot afford to assume the cost of her daily care because her income is too low.
We have recently been inundated with hundreds of similar stories of immigrants and refugees who came to the United States, raised families, worked, and then found themselves in need of assistance due to a serious disability that prevented them from being self-sufficient. Some of these people are now on suicide watch, as you heard Sharon talk about.
Page 96 PREV PAGE TOP OF DOC Included in the President's budget are provisions which would restore SSI, Medicaid to legal immigrants and refugees who become disabled after entering the United States. These funds will help those people who are unable to naturalize and who have no viable alternative assistance. If we were to restore these funds, there would still be 150,000 elderly who, even if we accepted the President's budget numbers, we would still find that there were an additional 150,000 elderly who would lose SSI this year. We also believe food stamps should be restored to the most needy of these people.
Our community has long supported America's commitment to serve as a safe haven for a small number of people whose lives and liberties have been at risk in their homelands, and some may have sustained injury or trauma as a result of their experiences. In exempting refugees and asylees for the first 5 years, Congress recognized the special commitment to this persecuted group. Since applying for citizenship may only commence in the last 3 months of the fifth year in the United States, the exemption expires before citizenship can be conferred on these people.
Moreover, due to the increased volume of naturalization applications and the INS' increased scrutiny, including now FBI checks, as they should be, the naturalization process has slowed now from the INS' targeted date of 6 months and it could take as long as 30 months once again.
Extension of the exemption for refugees and asylees for an additional 2 years would give both those delayed by INS processing and others with disabilities the time necessary to naturalize. The President's budget includes such an extension that is estimated to cost about $700 million over 5 years, and we believe this is a very modest outlay for such a large effect.
We also urge Congress to provide Medicaid coverage for all legal immigrant children. It is prudent, in our view, to make available health care coverage that makes possible preventable care and early intervention rather than to deal with the costs associated with the lifelong effects of illness not treated in childhood. The Clinton budget estimates that coverage for this group will cost about $200 million over 5 years.
Page 97 PREV PAGE TOP OF DOC We are very concerned about the group of elderly immigrants who are not so disabled that they qualify for SSI but who do require special help to be naturalized. We support additional funds allocated to the INS and to private charitable groups involved in naturalization specifically for those targeted groups.
We favor specific remedies over a block grant approach, particularly because of our experience with the State Legalization Impact Assistance Grant, known as SLIAG, a block grant that is a result of the 1986 Immigration Reform and Control Grant. Although SLIAG was federally mandated, its appropriations in the third year were reduced by almost two-thirds to support discretionary spending elsewhere, and by the fifth year, SLIAG funding reached zero. Once established, the formula for allocating a block grant, it will be almost impossible to change and it may not be responsive to shifting population needs or immigrant needs, and that is our concern.
Mr. Chairman, we do not believe that any of the remedies we have discussed today are too costly. Of the total budget package of about $8 trillion over 5 years, the $14.6 billion that the administration has allocated for immigrant and refugee fixes is quite modest and will make a profound difference for people who have no other hope or support. Thank you.
[The prepared statement follows:]
Statement of Diana Aviv, Associate Executive Vice President for Public Policy, Council of Jewish Federations
Mr. Chairman, Representative Levin, members of the subcommittee, thank you for the opportunity to testify before you today to comment on President Clinton's Fiscal Year 1998 budget proposal as it pertains to assistance provided to refugees, asylees, and legal immigrants impacted by the welfare reform statute passed last year.
I am Diana Aviv. I serve as Associate Executive Vice President for Public Policy of the Council of Jewish Federations and Director of its Washington Action Office.(see footnote 5)
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Founded in 1932, the Council of Jewish Federations was created to be the national association of local Jewish Federations. As the central planning, allocation and fund-raising organizations in their communities, local Federations work with their affiliated agencies to assess needs, develop resources and provide direct financial support to their agencies. Support is given to thousands of programs including family service agencies, vocational services, community centers, hospitals, elderly housing facilities and nursing homes. Taken as a whole, the Federated system that CJF represents embraces more than 6.1 million Jews and distributes billions of dollars annually for social service assistance to Jews and non-Jews nationally and internationally. Among CJF's functions are the coordination of joint needs and responsibilities, information dissemination, sharing successful health and human service program ''best practices'' among the Federations, providing national and international leadership, and conducting research and needs assessments to guide Federations in their planning for the future.
Today, CJF and its 180 member Federations work closely in a collaborative partnership that draws on the strength of local, community service-oriented Jewish Federations. Federations depend on the expertise and leadership of a national system that offers planning and coordination, financial resource development, fiscal management services, education and training, and national and international advocacy for the system.
Mr. Chairman, I am not here today to revisit welfare reform. We note your commitment not to amend the welfare reform statute at this time in order to give time for the reforms to work. It is not inconsistent with this commitment to recognize that major social policy reforms often produce outcomes for some classes of individuals that were not intended, and that are sufficiently damaging to warrant some adjustments.
We have concluded that some provisions of the welfare statute treat certain legal immigrants, refugees and asylees so harshly that they will not be able meet their basic health, nutritional, and housing needs. Moreover, these provisions are unrelated to the basic goal of the welfare reform statuteto move people from welfare to work.
Page 99 PREV PAGE TOP OF DOC The FY1998 budget submitted by the President includes a series of measures that respond to some of the most severe restrictions imposed on legal immigrants, refugees, and asylees. For many, their disabilities among other factors, make employment impossible. Many of these disabled individuals are eligible to become naturalized citizens, but their physical or mental disabilities prevent them from meeting all the requirements for naturalization. In addition, not all legal immigrants living in the United States have sponsors who are currently able to support them. Only this week our Detroit community reported to us a case of an octogenarian legal immigrant living in the local Jewish nursing home who will lose her SSI payments and whose sponsor is her sister two years her senior also living in the nursing home.
In considering the impact that the statute would have on legal immigrants and refugees, we took into consideration a number of factors. These include whether there are other resources available to the immigrant or refugee and whether family members can contribute more. Another such factor is whether there are local community agencies that can substitute for lost federal funds. We have begun to assess the capacity of our health and welfare agencies to continue service to these people even if they no longer receive SSI checks and possibly food stamps. We also have begun to access the likelihood that our own charitable community might be able to increase fund raising in order to bridge the gap. In that regard, I would like to share with you the burdens facing our community in Chicago. The Jewish Federation of Metropolitan Chicago estimates that elderly and disabled refugees alone who have been in the U.S. for more than 5 years and are not citizens, will lose between $7.358.24 million in assistance over the next year.
The loss of these benefits may also yield a slew of secondary effects, such as the inability of refugees to make their monthly rent payments. Accordingly, the Council of Jewish Elderly (CJE) which operates Section 202 and Section 8 housing units may face a $300,000 loss in rental income. CJE is also facing the potential loss of $50,000 in housing assistance to Soviet Jews who arrive in the future as legal immigrants and $250,000 per year in Medicaid reimbursements for six Soviet Jews who reside in one of its facilities.
Page 100 PREV PAGE TOP OF DOC The State of Illinois may also eliminate subsidized medical care for elderly and disabled refugees. Such action would result in the loss of $9 million in benefits and greatly impact the ability of providers such as Mount Sinai Hospital to care for these individuals. Mount Sinai Hospital may also lose $14 million in medicaid reimbursements for in-patient services to the Latino community. The Chicago Federation has concluded that it will be impossible to make up for this loss of federal funding. Chicago and other federations have been successful on a more limited basis in raising funds to naturalize legal immigrants and refugees. However, with the burden placed on federations to raise funds to naturalize legal immigrants and refugees, it will be impossible for them to raise sufficient funds to offset the loss of Federal funds
In light of these criteria, we are very concerned with legal immigrants and refugees whose families are not able to provide for their basic living needs. Loss of SSI and medicaid by these individuals will create a burden for nursing homes, assisted living facilities and hospitals that they will not be able to carry. Many legal immigrants and refugees have been living in the United States for years and long ago met the 5-year residency requirement for citizenship. Some became disabled after residing in the U.S. and their disability prevents them from becoming self sufficient.
Mr. Chairman, one of the groups of legal immigrants that we are most concerned about are those people who become disabled after entering the United States. In the course of life, unanticipated illness, automobile or work accidents, or random violence can incapacitate any one of us. Where health crises or advanced age prevents employment, it may become impossible to meet medical and living expenses. We have reports from all parts of the country informing us that elderly parents are considering suicide rather than impoverishing their children and grandchildren with expenses that their families cannot possibly pay. Even where children help as much as they can, often the expenses often exceed their available resources.
One such example is a client of ours who I will refer to as Bella, a 90 year old Russian Jewish woman who immigrated to the U.S. with her daughter in 1979 as a legal immigrant before passage of the 1980 Refugee Act. Bella and her daughter were forced to flee Byelorussia because of threats to her and her property. After coming to the U.S., Bella lived independently and cared for herself until a year and a half ago. At that time, she was diagnosed with Alzheimer's Disease and paranoia. She is incapable of handling her own bathing, dressing or feeding, and will not take her medications. Her memory is poor and her speech repetitive. She will not be able to naturalize. Her daughter is willing to help care for her mother when she is not working, but cannot afford to assume the cost of her daily care and medications because her income is barely enough to make ends meet.
Page 101 PREV PAGE TOP OF DOC We recognize the Congress's interest in creating a policy that discourages prospective legal immigrants from coming to the United States primarily to benefit from the welfare system. However in trying to develop a policy that meets this objective, it also swept up legal immigrants who were motivated by hope and opportunity, not by the welfare system. However, circumstances beyond their control, forced them into a position of great need. One such example is Rose, who immigrated from Lebanon 76 years ago and is 92 years old. She lives in a nursing home and has Alzheimer's Disease. Her husband naturalized in 1939 and died in 1946. She raised 8 children, all of whom are U.S. citizens. The oldest is retarded and ill. Another child lives on his Social Security check of $500 per month. Three sons are in their 70's and diabetic. One daughter is a retired housekeeper unable to walk and another daughter is a partially disabled clerical worker who wants to retire. None of these children can afford to pay for their mother's care. When Rose loses her SSI, she may be forced to leave her nursing home, with nowhere to go.
Another example is Taisya, 77, who came to the United States in 1981 as a political refugee from the Soviet Union. She worked for several years until developing heart problems and arthritis. Her medical bills are paid by Medicaid and her SSI check pays the rent and other expenses. Because of the federal law, she will lose her sole source of income, SSI, and will not be able to pay for food, clothing, or shelter. At her age and physical condition, she has neither the skills nor the capacity to work and is afraid that without SSI and Food Stamps she will lose her apartment and have no place to go.
We have recently been inundated with hundreds of similar stories of immigrants and refugees who came into the United States, raised families, worked and then found themselves in need of assistance due to a serious disability that prevented them from being self sufficient. Included in the President's budget are provisions to restore SSI and Medicaid to legal immigrants and refugees who become disabled after entering the Unites States. We believe that these funds will help those people who are unable to naturalize and have no viable alternative assistance available to them. In addition, we believe that Food Stamps should also be restored to the most needy of these people.
Page 102 PREV PAGE TOP OF DOC The American Jewish community has always advocated for the right of individuals everywhere to live free of persecution. We have supported America's commitment to serve as a safe haven for a small number of people whose lives and liberties were at risk in their homelands. The United States has become home to millions of Jewish and non-Jewish refugees and asylees who have proudly taken the oath of American citizenship in order to exercise the economic, religious and political rights denied them in their countries of origin.
In exempting refugees and asylees for the first 5 years the Congress recognized the special commitment that the United States has made to a limited number of people who have fled or were facing religious, political and other persecution in their homelands. A portion of these refugees and asylees may have come to the United States having sustained injury or trauma as a result of their experiences. America's historic commitment to providing safe haven for refugees and asylees and helping them to adjust and live in the United States has included providing assistance where needed.
In most cases, refugees may not apply for citizenship until the last three months of their fourth year in the United States. Due to the increased volume of naturalization applications and INS's increased scrutiny (including FBI background checks), the naturalization process has increased from the INS's 6 month target and may take as long as 36 months. We therefore believe that extension of the exemption for refugees and asylees for an additional two years would give both those delayed by INS processing and others with substantial disabilities the time necessary to naturalize. The President's budget includes such an extension that is estimated to cost $700,000,000 over 5 years. We believe that this is a modest outlay for such a large effect.
Another area in which Congress can cover and protect an especially vulnerable legal immigrant group is Medicaid coverage for legal immigrant children. Such coverage makes fiscal sense for a population group who almost certainly will become citizens. Moreover, it is prudent to make available health care coverage that makes possible preventive care and early intervention rather than having to deal with covering the costs associated with the life long effects of illnesses not treated in childhood. The Clinton budget estimates that coverage for this group will cost about $200 million over 5 years. We strongly endorse measures such as this that will provide full Medicaid coverage for all legal immigrant children.
Page 103 PREV PAGE TOP OF DOC We are very concerned about the group of elderly immigrants who are not so disabled that they qualify for SSI, but who require special help if they are to be naturalized. Poor memories, difficulty in learning English, and serious discouragement as a result of problems with some INS officials have caused such immigrants to abandon their efforts to pursue citizenship. We support additional funds allocated to the INS and to private charitable groups involved in naturalization specifically targeted at this population group.
Mr. Chairman, we favor these specific remedies over a block grant approach particularly because of our experience with the ''State Legalization Impact Assistance Grant'' (SLIAG), a block grant that was mandated in the 1986 Immigration Reform and Control Act. These block grants proved difficult to manage and did not target in the most efficient way the people in the greatest need.
Our fear is that the neediest people who lose their SSI and Food Stamps may not be able to pay their rent and could be evicted. While charities can help by providing some additional short term emergency assistance and by expanding their food banks, we are certain that it is not possible for us to provide the additional services that these people will need. Mr. Chairman, we do not believe that the remedies we have discussed today are too costly. Of the total spending package of about $8 trillion over 5 years, the $14.6 billion allocated for immigrant and refugee assistance is quite modest and will make a profound difference for people who have no other hope of support.
Chairman SHAW. I would like to comment, first of all, with regard to the last two witnesses who made reference to the Congress taking away Medicaid. That is not the case. The Congress has left it up to the States. So far, only four States have opted not to extend Medicaid coverage to noncitizens, and I do not anticipate that number to rise. So we have not taken the Medicaid away.
Page 104 PREV PAGE TOP OF DOC Ms. Daly, I would like to take very strong exception to what you said with regard to how can we brag about the caseload going down when the bill was only just put into place. An unprecedented decline in the caseload has taken place since 1994. If you look at the States who have had waivers granted to them, you will see that it is incredible, the way those caseloads have gone down.
You look at States such as Michigan and Wisconsin, and the Congressional Research Service prediction is that those caseloads will have dropped by 1998 by approximately 60 percent. Now, those people are not just being thrown into your shelters. They are getting real jobs and that is what is really out there.
Now, what did we do by putting this block grant in? We gave those States, and the States who get their caseload down, we gave them funding which is constant and which they can now use to train the people who are really going to have a tough time. We know, and we are not kidding ourselves at all, and the administration also knows these people that are getting off the caseload now are the easier ones. There are going to be some really tough cases later when you start getting down to the hardcore unemployed.
That is why this Subcommittee is going to watch this very closely and this Subcommittee is also going to look for new and innovative ideas to put the jobs in areas where a lot of people are who were put in those areas and have stayed in those areas because 60 years of a corrupt welfare system has paid them to stay where they are; not to seek work, to have kids, and not to get married. As a result, we have pockets of poverty in this country that we are going to have to work very, very hard to eliminate.
Also, when you talk about these few people, particularly with the old AFDC Program, the States have plenty of exceptions where they can grandfather people in. This was not mentioned at this hearing, but I have heard in other hearings where concerns about, well, what about grandparents taking care of kids. Well, those would be some of the exceptions that the States can make, and they can make exceptions as to work requirements and we were very generous in the amount that we were talking about.
Page 105 PREV PAGE TOP OF DOC Also, knowing we were going to see a dramatic drop in the caseloads and a tremendous increase in the amount that the States were going to have to spend per recipient, we dropped the matching fund requirement to 80 percent from 100 percent. This frees up State funds that they can use to close the gaps in some other areas.
There is no question but that the fact is those caseloads have gone down, and it has never happened in the history of welfare, believe me, it has not. The most they have ever been reduced in previous years is perhaps 1 percent, where we are looking now at 4 percent and we are looking at sustained reduction which is accelerating. What has caused that? Well, we have had a good economy, but we have had good economies before, so that is only part of it. But we have had States that have been very progressive and through the waiver process, which started with Reagan, continued with Bush, and has continued with Clinton, they have been allowed to impose the welfare reforms within those States that you are now criticizing.
Third, in the States that did not have waivers, we have seen the decline also and that is because the people on welfare know that those benefits are going to dry up. Believe me, people on welfare, a majority of them know as much about programs and what is available to them as Members of this Subcommittee do. Just because they are poor does not mean they are ignorant. They know what is out there and what is available, and they also know they are going to have to go to work.
I think the point Dr. Horn made and Mr. Rector made was to leave it alone, do not confuse the public out there now, hold the course, and this thing is going to work.
I think when you look at the cruelest system of it all, the cruelest system for a child is to pay them not to work. We have had witnesses before here that talk about how much better the kids do in school, how their attitudes change and everything else when the parents come to work. Ms. Anderson of California came in here. She is the Welfare Director for the State of California and she was telling us how the kids would come to school and say, ''My mom went to work today.'' The biggest problem we have is the single mom, and that is the worst kind of poverty we have in this country.
Page 106 PREV PAGE TOP OF DOC I think this Subcommittee has done a tremendous job. We are not going to walk away from the problem. We realize the Federal Government created this mess and the Federal Government has a responsibility to help clean it up. We are going to continue to watch this very, very carefully.
The question was made as to the children of immigrants. Those that are in the country now, they will continue to get the AFDC payments. We are not taking that away from them. The ones that come in later, they will not get the benefits, but when you see the way the system has been played and when you see the accelerated growth of immigrant population on different welfare rolls, you see the thing is totally out of control.
This is not anti-immigrant, because there is also another very interesting statistic. The immigrants who have naturalized are far less likely to go on welfare than an American-born citizen. So that shows you this is not anti-immigrant or beating up on immigrants, but I think we have to be careful and we have to be very careful particularly when we are dealing with the public's money.
Our heart goes out to all of these people, there is no question about it, and I am looking into the situation of what happens when someone cannot take an oath of office because of mental impairment. I think those are things we need to look at and we will look at, even though the States can continue to take care of them under the Medicaid Programs.
So there is going to be some fine-tuning, but there is not going to be any wholesale change within the welfare system because we feel that what we have put in place is working and working very well.
Mr. LEVIN. Following up on that, I do not think we are going to reopen the AFDC reform. We are not going to do that. We are not going to know for several years how it is working. I think all of us, no matter how one voted, should pull together to try to make sure it works. As Mr. Shaw said, we need to watch it closely.
Page 107 PREV PAGE TOP OF DOC I also hope we can, by adopting the President's proposals or some version thereofwe do not have the details, we may want to totally rework themwill be sure the States have adequate resources so people going off of welfare go to work and so that there are not empty glasses. I think instead of everybody trying to predict what is going to happen, we ought to make sure the AFDC reform works.
Dr. Horn, we are not reopening that issue. We might as well go on and try to talk about how we make that work and also to talk about what is imminent and that is the set of provisions regarding illegal immigrants and the food stamp provisions. I am hopeful that groups that focused on the AFDC reform will now focus on the impact in the next months of these provisions. There was not enough focus on these provisions when they were passed.
I just wanted to ask Mr. Rector a few questions. You talk about 70 means-tested welfare programs. Do you have a list of the 70?
Mr. RECTOR. I can give it to you right now.
Mr. LEVIN. Are any education programs included?
Mr. RECTOR. Yes, particularly title I and Pell grants. They comprise about 7 percent of the total spending.
Mr. LEVIN. I do think that when you talk about 70 means-tested programs, you talk about cash, food, housing, medical care, social services. We should be clear we are also talking about education programs. Head Start, do you call that welfare?
Mr. RECTOR. I would call that social services to the low-income people.
Mr. LEVIN. But you say 70 means-tested welfare programs. Do you include that as a welfare program, Head Start?
Mr. RECTOR. Yes, anything that provides benefits or services to low-income people.
Mr. LEVIN. Second, you talk about 785,000 lawful noncitizen residents. We have discussed this before. The majority are here with sponsors. There is a substantial number who are here as refugees and asylees, right?
Page 108 PREV PAGE TOP OF DOC Mr. RECTOR. Yes.
Mr. LEVIN. You say they are excepted from this ban. I think you need to modify that.
Mr. RECTOR. It should have said, excepted from this ban for 5 years. That is a good point.
Mr. LEVIN. Do you know what portion of the 20 to 25 percent who are refugees, asylees, have been here for more than 5 years?
Mr. RECTOR. I do not.
Mr. LEVIN. Do you think it is relevant?
Mr. RECTOR. Yes, I do.
Mr. LEVIN. I hope the Subcommittee will look at that, and I hope you will.
Mr. RECTOR. Yes.
Mr. LEVIN. Now, there is a reference in your testimony to one in three seniors on SSI is now a noncitizen. I think one-third are those who are on SSI as elderly people.
Mr. RECTOR. Yes. It is one in three seniors on SSI, one in three
Mr. LEVIN. Who are elderly. Now, that does not include the people over 65 who are noncitizens who are on as disabled, does it?
Mr. RECTOR. It probably does not. It is the same figure that Chairman Shaw used earlier. Of those that are on and the condition of eligibility is age, a third of them are noncitizens. That is exactly right.
Mr. LEVIN. I am not sure the nuances are picked up. The number of noncitizens who are on SSI who are over 65, excluding the children, that is not one-third because the number who are there as disabled is considerably smaller. So I think, so we get a fair picture, you need to talk about all the noncitizens who are over 65 who are drawing SSI and what percentage they are. That is really the more accurate figure, I think.
Also, I wanted to ask you about your statement that many, if not most, of the sponsors enrolled their elderly immigrant relatives on welfare soon after the end of the 3-year waiting period. I have some figures from, I think it is from SSA, and it shows that in terms of the first 4 years, 35 percent of those on SSI went on the first 4 years. Another 35 percent went on from the year five through ten, and 30 percent went on after they had been here 10 years. The largest number in any single category went on after they had been here 12 years or more.
Page 109 PREV PAGE TOP OF DOC I just want us to see the facts and see the faces, and I hope all of us will join and not kind of twist facts or take the facts that are best for their conclusion. We need to have a thorough discussion about who these people are, the legal immigrants and food stamps in another Committee, what the impact of the law is and not reopening AFDC.
We are, again, not talking about that, but these are not young people with kids, Dr. Horn. These are basically elderly people, many of them disabled, most with sponsors but many without, some with sponsors who are dead, who are bankrupt, or in some cases, sponsors who were children who have left, and every American has a stake in looking at all Americans. Thank you.
Mr. RECTOR. If I could respond, I think that chart you used, there is an important other variable there which is when the person turned 65. That just makes it a little bit more complicated. Not all these people were 65 at the point of entry, so there are two variables that will determine when they apply for SSI, when they go over the deeming period but also when they hit 65, and that just makes that chart a little bit more complicated, but your point is valid.
Chairman SHAW. And the deeming period is 5 years.
Mr. RECTOR. And the deeming period is now 5 years.
Chairman SHAW. We are going to have to move on.
Mr. COLLINS. Thank you, Mr. Chairman.
You know, I listened with interest from all four of our panelists as they went through their comments and testimony and I appreciate each. They are from each end of the spectrum. But those types of comments are important to us as we watch the implementation of the welfare reform that passed last year. There have been some good improvements made, and I hope there will be even greater improvements. There will be some areas that we are probably going to have problems with and your comments are helpful to us.
I look forward to, in the State of Georgia, meeting with the Governor and the people in the welfare system there that administer this system to, and also at the county levels, to get their input and to be made aware of things that are happening there.
Page 110 PREV PAGE TOP OF DOC But it is not only helpful to us as we go through implementation of welfare reform and make some technical corrections, but it is also helpful to us from a tax reform perspective, because if we are going to be successful with the welfare reform, we are going to have to be successful with tax reform that is going to create a stronger economy, that is going to enhance nonwelfare families in their budget, their home budget, and their lifestyles which creates a stronger economy for everyone.
I am cautious of temporary tax credits that seem to be piecemeal. I would prefer creating an incentive for a job, rather than having a 50-percent tax credit for that job.
I would like for us, too, to keep in mind as we look at tax reform in the area of charities, provisions of law that might encourage more participation and contributions to charities rather than maybe some stumbling blocks that are disincentives for people to contribute to people who are doing very well and helping, as you are, Ms. Daly.
So I really appreciate the testimony of each, comments that will help us be aware and to be cautious and pay attention to what is going on as reform is implemented, and I thank each of you for being here.
Chairman SHAW. Mr. Matsui.
Mr. MATSUI. Thank you, Mr. Chairman.
First of all, I would like to take this opportunity to commend and thank Sharon Daly for all the work she has done over the years but particularly over the last year. I think you were one of the few groups and few individuals that really stood out there and kept fighting away in spite of insurmountable odds, particularly in the last couple of months, and I just want to thank you for your efforts. Others were involved, as well, but you, in particular, were very active and very visible and I know how difficult that is, but I do appreciate that and I think everybody recognizes and fully appreciates it, as well.
I am not going to ask any of the panelists a question. I guess part of the frustration today, at least in reading part of your testimony as questions were being asked for both you, Ms. Aviv, and Ms. Daly, is the fact that it is as if you are just expressing frustrations over a bill that is already in the law. I think many of us, perhaps Mr. Stark, myself, and others, and I know Members on the floor are expressing that same kind of frustration.
Page 111 PREV PAGE TOP OF DOC I guess the real problem I see right now with this is we knew the President when he signed the bill said that he was going to try to restore the benefits for legal aliens. On the other hand, I did not hear a clamor on the Republican side of the aisle that they agreed with that, and certainly there was not a clamor on our side of the aisle, the Democratic side of the aisle, for those Members that were voting for it that they were going to support the reinstatement of this. I know Mr. Levin agreed with that. I was one of those 101 that voted against this bill and I still feel it is a very bad piece of legislation. In 5 years we are going to really understand how bad this legislation is.
In the State of California, the State is not assuming the responsibility, as many of us had hoped. What happened now is the State is going to devolve this to the counties and then the counties are going to have to make a decision as to whether or not they are going to deal with police and fire protection for their citizens or else pay for benefits for immigrants or people deep into poverty who have been cutoff. I mean, that is the choice, and as a local government official back in the seventies, I can tell you, that choice is pretty easy when you are sitting there before your city council.
But the frustration is that now you are here, and as I said to the prior panel, and I believe some of you might have been here, I do not see how this is going to come to pass unless the Governors get involved, and that means Governor Pataki, Governor Wilson, Governor Bush of Texas, Governor Edgar of Illinois, and I do not believe these Governors at this time plan to do anything. They came to Washington 2 weeks ago and they were pretty enthusiastic and then, from what I read in news accounts, Mr. Lott called a few of them up and then all of a suddenI understand George Bush did not even show up when it came to deal with the resolution.
So we need to face some kind of reality, and I think the strategy all you have will have to be not only to continue doing what you are doing, but calling out what the problems are, because I think this is really going to hit hard in the fall of this year and people are going to be scrambling.
Page 112 PREV PAGE TOP OF DOC But you are also going to have to try to put pressure on your State Governors and somehow they are going to have to try to get to Members that voted for this piece of legislation, because I do not know how you are going to achieve your result. I mean, you could fight another losing battle by continuing to talk to myself, Mr. Stark, and Mr. Miller, the Black Caucus, the Hispanic Caucus, but I can guarantee you that those members may be there, but that is 101 votes. You will be about, what, 117 shy. On the Senate, you are even more than that because only 21 Senators eventually voted against this piece of legislation.
I do know Mr. Shaw has indicated he may want to make some adjustments, of block granting, perhaps something else, but I think we could all work on that and if you feel that is enough, that obviously we can support that. But the reality is that to think that by continuing to talk to us you are going to get changes, I just do not think that is going to happen.
Let me just conclude. Mr. Rector, you actually were the one who achieved the most, along with Mr. Shaw and the Republican leadership, because I remember way back in 1993 you were talking about devolution and you were talking about block granting many of these programs, and now we are going to find out. I do not begrudge you. I think you did something very remarkable, along with the Republican leadership, Mr. Shaw, Mr. Thomas, Chairman Archer, and the rest of them. But now we will find out whether or not this will work, and I hope for the sake of the young people in America and our children that it, in fact, does work.
Mr. RECTOR. If I could just commend your attention to an example of the type of reform which is what I have advocated for close to a decade now, it is going on in Wisconsin as we speak in Wisconsin. I would like to correct what was said earlier. To the extent anyone has been cutoff of AFDC in Milwaukee, they are all guaranteed jobs. These are people that refused to work in a job that they were given, and they mainly did that because they are crack addicts and they cannot work. Now they are out of their apartments and we are going to deal with them much more intensively.
Page 113 PREV PAGE TOP OF DOC But as we speak, with the reforms in place in Milwaukee and the rest of Wisconsin, the AFDC caseload is dropping 2 percent per month in Milwaukee, 4 percent per month in the rest of the State. They will cut their caseload by one-third within 1 year. Within 28 of the 77 counties in the State of Wisconsin, they have already reduced AFDC dependence by more than 80 percent, and these are people in jobs. This is cracking the back of dependence. This is the type of reform that needs to be done across the United States and every single State can do it if they will implement the serious work requirements that are now in place in Wisconsin.
Chairman SHAW. Mr. English.
Mr. MATSUI. Mr. Shaw, I did not realize Mr. Rector was going to respond. May I just make an observation, because I know Ms. Daly wanted to
Chairman SHAW. Do it very quickly, because we are going to have another vote.
Mr. MATSUI. OK. I will be very, very brief, but, you know, nobody suggested that everybody on welfare would stay on welfare forever. In fact, statistically, about 65 percent of the people on welfare go off of welfare. Many go back on because of broken marriages, because they need Medicare or Medicaid benefits and so they need to go back. So we were not suggesting these people were going to stay on forever. We all knew that 65, maybe even up to 70 in some communities that have low unemployment would go off of welfare.
So that is great, that 11 percent or 2 percent a month are going off, but wait until you get to the hardcore. And I know you have the 20-percent recycling, but most, not all, but most poverty economists realize that that will not be enough to deal with it.
And Ms. Daly, I do not
Chairman SHAW. Mr. English.
Mr. MATSUI. OK.
Mr. ENGLISH. Thank you, Mr. Chairman.
Let me say, I am delighted to hear the thoughtful comments of my colleague from California and would be happy to cede him some more time at some point if he would like.
Page 114 PREV PAGE TOP OF DOC I have been talking to our Governor in Pennsylvania as Pennsylvania moves forward to implement some of these issues. I think they have been doing and contemplating some very creative things and doing so with a certain amount of flexibility, since Pennsylvania, in terms of an average benefit per family, has actually under our bill experienced roughly a 40-percent increase for a combination of cash welfare, child care, and job preparation benefits. My hope is that will give them the flexibility to thoughtfully do some of these things.
Dr. Rector, you have been, obviously from your vantage point, following some of the things that are being proposed in the States. Do you see the level of State innovation in welfare policy that some had anticipated, and what impact on that level of State innovation would the President's proposals have?
Mr. RECTOR. The President's proposals are utterly irrelevant, astonishingly irrelevant. They have been proven to be failures in the past. We already have tax credits of this sort; they do not work. What we know
Chairman SHAW. We will put you down as agreeing with Pete Stark, total agreement.
Mr. RECTOR. Total agreement, 100 percent. [Laughter.]
What we do know that does work are things that are actually in the Federal legislation. Pay for performance, both Oregon and Wisconsin now have pay for performance. That means when you put somebody in a community service slot, if they do not perform the correct number of hours of work, it is just like a job and they do not get the check. As soon as they did that in Milwaukee, the caseload started dropping. It dropped 4 percent in a single month. Also, you need to have application dissuasion. You have to have a focus on dropping the caseloads.
Mr. Matsui, we are not talking here about people churning on and off. OK, there were always exits off of welfare. That is not what is happening in Wisconsin. The net caseload is going down. The net caseload has dropped by 55 percent. It is never anything even remotely like that ever happened in the history of AFDC, going back to the thirties. Fifty-five percent. In many of these counties, the net caseload is down by 80 percent. There is, effectively, no more AFDC Program in much of the State because once they said, You must work for benefits, people did not even bother to show up to get on.
Page 115 PREV PAGE TOP OF DOC Mr. ENGLISH. Doctor, on that point, I know there has been a gradual national decline in the AFDC rolls. What you are suggesting is in Wisconsin, there is a demonstrably greater
Mr. RECTOR. Five times greater.
Mr. ENGLISH. OK.
Mr. RECTOR. Within the last 6 months, if I could show, in Wisconsin within the last 6 months alone, the caseload has dropped 20 percent. In the Nation as a whole, the comparable figure is 5 percent. There are reforms going on in most of the States but they are not good enough. What they need to do is put what is required in the Federal law, pay for performance, and also put something in that they have in Wisconsin called self-sufficiency first, which is designed to dissuade applications at the front door and say, do you really need to get on AFDC? As soon as they put that in place in Wisconsin, the number of people who bothered to enroll dropped in half.
Mr. ENGLISH. Thank you, Doctor.
I do not want to neglect our other panelists and I am very appreciative of your testimony here today. Recognizing the linkage between welfare reform and Medicaid policy, I wonder if the other panelists would comment, while it is not strictly within the jurisdiction of this Subcommittee, on the likely impact on these issues of the President's proposal on Medicaid funding. Have any of you had an opportunity to assess that and can you comment on it?
Ms. AVIV. I will just make a very limited comment. We were very pleased, and I want to recognize what Mr. Shaw acknowledged, that the Congress gave the States the option about Medicaid with respect to current proposals that are on the table today. We were pleased that Medicaid was not included in the list of programs barred, and we are also pleased that States have not, for the most part, except for the numbers that you identified, elected to bar.
We were concerned even within that context, before getting to the President's proposal, that even if people requalify for Medicaid, those who will be barred, legal immigrants barred from SSI and food stamps, that the way in which they will be requalified would not provide them sufficient coverage.
Page 116 PREV PAGE TOP OF DOC I know our community is very concerned about any kind of capped entitlement because, again, if we have an elderly person who has profound illnesses and so on that requires assistance and another healthy elderly person, the fact that their spouse has access and does not need it is a problem for the others. But we have not studied them
Mr. ENGLISH. But you were concerned that the per capita caps might have a direct impact on access.
Ms. AVIV. Yes. We know that for our community, that will be a serious problem.
Mr. ENGLISH. In conclusion, Mr. Chairman, I know the Governor of our State who previously served with a number of you in Congress has pulled back from and has declined to support the President's proposal. I think this issue is something we should keep in mind as we consider these matters, and thank you for the opportunity and thanks to the panel for your excellent testimony today.
Chairman SHAW. Mr. Hayworth.
Mr. HAYWORTH. I thank the Chairman.
I thank the panelists for coming. I especially appreciate Ms. Daly pointing out the graph at the back of her testimony. Ms. Daly, with your help, let me go over this again. I just want to make sure I understand. You have heard of hand-eye coordination. Maybe my graph-eye coordination is a little bit off today.
Do you combine the Catholic Charities and the United Way campaign spending with the private human services giving here? Is that a combination of things? In other words, is that the total private giving?
Ms. DALY. That is the total private giving on human services for low-income people.
Mr. HAYWORTH. OK.
Ms. DALY. There is lots of giving to museums and
Mr. HAYWORTH. Understood. So you are including the Catholic and the United Way
Page 117 PREV PAGE TOP OF DOC Ms. DALY. I believe so.
Mr. HAYWORTH. OK. And so the disparity there is
Ms. DALY. And then the Jewish Federation and the Lutheran Social Services and lots of others on top of that.
Mr. HAYWORTH. OK. I am just interested also in your testimony when you offer the survey summary of 1995 and there is a graph at the bottom of the page, 1995 income. Again, just for the record, how much of that income comes from the government?
Ms. DALY. A little over 60 percent, and that is Federal, State, and local government. Nearly all of that is contracts for specific services, for example, residential care for children who are too disabled or too mentally ill to live in the community and they live in our institutions.
Mr. HAYWORTH. So 61.9 percent of your income comes from
Ms. DALY. Government at all levels.
Mr. HAYWORTH [continuing]. Some form of government at all levels. Do you know what the Federal number would be?
Ms. DALY. We do not, and we tried very hard to find it out, but our agencies mostly get their money in contracts from their counties.
Mr. HAYWORTH. I see.
Ms. DALY. And sometimes from their States, and they cannot separate out how much is Federal, because in almost all the programs, there are State and local matches. So it is very hard to pick out how much is Federal.
Mr. HAYWORTH. Ms. Daly, with that in mind, it may be difficult to answer this question, but I would presume that Catholic Charities, as the arm of the Catholic Church in the United States dealing with social issues and concerns, was certainly in operation long before President Johnson declared his war on poverty.
Page 118 PREV PAGE TOP OF DOC Ms. DALY. Right, about 100 years.
Mr. HAYWORTH. Yes, ma'am. Do you know what percentage of income came to Catholic Charities USA in 1963, for example?
Ms. DALY. I do not. I could get it to you for the record. I want to clarify, very little of this money comes to Catholic Charities USA. These are contracts between the State and local governments and our local independent agencies. We are just the national association. The money does not come to us. Only 4 percent of our total revenues of the national organization come from government.
Mr. HAYWORTH. And yet it is part of the umbrella to try and deal with these problems
Ms. DALY. Right.
Mr. HAYWORTH [continuing]. That we all want to deal with in terms of helping lift the poor out of their situation.
Let me ask you aboutfirst of all, let me also applaud your notion that work is desirable for those able-bodied people who certainly should have the chance to work. I am curious and trying to find some solutions, and I think my colleague from Georgia touched on it in terms of charitable choices, because it seems to me that what has happened exponentially is that government at all levels has taken an increasing tax bite out of family budgets and made some charitable work very difficult when families in the middle-class range are trying to put food on the table and educate their kids and deal with basic human services, even though they are a little further up the economic ladder.
What are your thoughts about some of the initiatives, I think specifically of what my friend from Missouri, Jim Talent, along with J.C. Watts, the gentleman from Oklahoma, have proposed in terms of choices to try and focus and enhance the notion of charity and tax breaks in that regard?
Page 119 PREV PAGE TOP OF DOC Ms. DALY. I think we are very interested in pursuing that, but our thoughts of our member agencies are somewhat complex. Of course, we are in favor of anything that would increase charitable giving, especially to programs that serve the poor. The question is, how would such tax credits be financed in the Federal budget since it is a zero-sum game, and the proposals up to now have emphasized providing individuals with tax credits for their charitable contributions by cutting programs for the poor, like food stamps or AFDC, and we would have to oppose that
Mr. HAYWORTH. I see. So in other words
Ms. DALY [continuing]. Because we think the net result would be less help for the poor.
Mr. HAYWORTH. Thank you, ma'am. So in other words, the redistribution of wealth enforced by the Federal Government is the more preferable way to deal with social problems.
Ms. DALY. No. I think both are important. We are definitelywe think there is a role both for charity, individual charity, as well as justice, that is, for the whole country, all of us as citizens to participate in taking care of the poor, but those are two different things and they are both needed. Neither can work without the other.
Mr. HAYWORTH. Fourteen billion dollars for noncitizens, about 320,000 noncitizens, about $43,000 per noncitizenmaybe I will check the math, but I do not think the numbers are adding up. I thank you for your time and your attention.
Ms. DALY. Thank you.
Chairman SHAW. Thank you. I would like to thank all of the witnesses, and I would like to say to Ms. Daly and Ms. Aviv that sometimes when we disagree, it does not mean we are not listening to you. I listened to both of you very intensely, as I did the other two witnesses. All of these things are stored somewhere in the back of your mind, even though we might at this time disagree.
Page 120 PREV PAGE TOP OF DOC Thank you very much.
Ms. DALY. Mr. Shaw, could I just respond very, very briefly?
Chairman SHAW. Yes, very briefly.
Ms. DALY. I wanted to thank Mr. Matsui for his very kind and generous remarks and you all for your kind attention and to say, I agree with Mr. Matsui. There are a lot of things wrong with this bill and I know they are not going to be fixed. But some things, like some benefits for some immigrants, can be fixed in this Congress, and I hope you will all work together with the administration and do that.
We cannot save all these children or all these old people. We can save some.
Chairman SHAW. There is no such thing as a perfect bill. They all have their warts. Thank you.
Ms. DALY. Thank you.
Chairman SHAW. We are adjourned.
[Whereupon, at 2:19 p.m., the hearing was adjourned.]
(Footnote 1 return)
Section 431 of Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) defines ''qualified alien'' as lawful permanent residents, refugees, asylees, aliens whose deportations are withheld, parolees, conditional entrants, and certain aliens who have been battered or subjected to extreme cruelty.
(Footnote 2 return)
For example, they receive Social Security benefits but we need to determine whether they have 40 quarters.
(Footnote 3 return)
See Norman Matloff's testimony before the House Ways and Means Committee, March 1, 1994.
(Footnote 4 return)
(Footnote 5 return)
The Council of Jewish Federations is not a Federal contractor or grantee.