The Senate heard the Governor’s ill-conceived trigger cut proposals today in Senate Budget and Fiscal Review Subcommittee No. 3. After extensive public testimony, the Subcommittee voted to reject the Governor’s proposals to completely eliminate In-Home Supportive Services (IHSS), CalWORKs, and Transitional Housing Program Plus (THP+) for former foster youth.

Before sharing a little data, I must recognize my CSAC colleague, Lisa Currie, for her effective public testimony about her success in moving from welfare to work. Great job, Lisa, in representing all the moms and families out there who have temporarily been on welfare and are now successful and self-sufficient. And thanks for asking the Legislature to preserve services for other families that need temporary help.

Below is a summary of CSAC’s testimony from the hearing today.

The Governor’s proposal would eliminate IHSS services for more than 460,000 people. The proposal would eliminate jobs for 376,000 providers statewide.  IHSS is estimated to create almost 34,000 private sector jobs. The loss of these jobs would increase the state unemployment rate by over 1 percent.

IHSS is estimated to generate $6.5 billion in economic activity and to generate $118.8 million in sales tax revenues. Elimination of the program would result in the loss of almost $2 billion in federal funds annually.

If the CalWORKs program were eliminated, 1.5 million people – one million of whom are children – would lose services. Counties estimate if ALL former CalWORKs recipients become eligible for General Assistance, it would cost counties statewide $1.9 billion. 

In addition, California would lose approximately $4.2 billion in federal funds, including new contingency funds made available to states through ARRA.

Every state dollar spent on CalWORKs yields $7.35 in economic activity.  CalWORKs generates $7.1 billion in economic output and $130 million in sales tax revenues.  Counties roughly estimate that 84,000 client jobs would be lost and 16,500 county employees would lose jobs.  In addition, counties estimate an additional 37,000 private sector jobs would be lost. For a grand total of 137,000 jobs.

Approximately 1,400 youth are currently housed in THP+ programs, and would face immediate homelessness if the program were cut. Additionally, 12% of youth are custodial parents; an additional 168 children would face homelessness. Homelessness has been estimated to cost society as much as $40,000 per individual.

In addition to the very real possibility of homelessness, a portion of the youth currently served by THP+ may also qualify for General Assistance. Studies show that approximately 51 percent of youth are unemployed with 2-4 years of emancipation.

According to a five-year longitudinal study, youth who “age out” of foster care are more likely to be arrested, incarcerated, unemployed and without a high school diploma than youth of the same age and sex.