H-4068

AN ACT Relating to economic empowerment; amending RCW 74.04.005, 74.12.240, and 74.12.245; adding new sections to chapter 74.12 RCW; and creating new sections.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature finds that welfare was conceived as a temporary relief program, recognizing that families can be temporarily placed in a financial crisis at any time in life. Successful welfare programs depend on the availability of adequate resources to assist individuals deemed eligible for the benefits of such a program. In this way, eligible families are given sufficient assistance to reenter productive employment in a minimal time period. When eligibility for welfare is not clearly defined or enforced, resources are consumed for purposes other than the public intends and result in a shortage of resources for eligible recipients.

The legislature finds that the aid to families with dependent children program and family independence program have fallen short in their efforts to return program participants to the work force and that even when Washington has experienced periods of economic growth, caseloads have continued to rise. These programs attempt to address material poverty, but in doing so, create disincentives and a behavioral poverty that include declining work efforts, increased illegitimate births, single parenthood, and prolonged welfare dependency.

The economic empowerment act seeks to promote the formation of healthy, two-parent families, reward work effort, and promote personal responsibility to include education, parental responsibility, job training, community enhancement activity, and gainful employment. The economic empowerment act further recognizes limited resources mandate that resources are best used when directed towards those individuals most motivated to achieve economic self-sufficiency.

NEW SECTION. Sec. 2. This act may be known and cited as the economic empowerment act.

Sec. 3. RCW 74.04.005 and 1991 sp.s. c 10 s 1 are each amended to read as follows:

For the purposes of this title, unless the context indicates otherwise, the following definitions shall apply:

(1) "Public assistance" or "assistance"‑-Temporary public aid to persons demonstrably in need thereof for any cause, including services, medical care, assistance grants, disbursing orders, work relief, general assistance and federal-aid assistance.

(2) "Department"‑-The department of social and health services.

(3) "County or local office"‑-The administrative office for one or more counties or designated service areas.

(4) "Director" or "secretary" means the secretary of social and health services.

(5) "Federal-aid assistance"‑-The specific categories of temporary assistance for which provision is made in any federal law existing or hereafter passed by which payments are made from the federal government to the state in aid or in respect to payment by the state for public assistance rendered to any category of demonstrably needy persons for which provision for federal funds or aid may from time to time be made, or a federally administered needs-based program.

(6)(a) "General assistance"‑-Aid to persons in need who:

(i) Are not eligible to receive federal-aid assistance, other than food stamps and medical assistance; however, an individual who refuses or fails to cooperate in obtaining federal-aid assistance, without good cause, is not eligible for general assistance;

(ii) Are either:

(A) Pregnant: PROVIDED, That need is based on the current income and resource requirements of the federal aid to families with dependent children program: PROVIDED FURTHER, That during any period in which an aid for dependent children employable program is not in operation, only those pregnant women who are categorically eligible for medicaid are eligible for general assistance; or

(B) Incapacitated from gainful employment by reason of bodily or mental infirmity that will likely continue for a minimum of ninety days as determined by the department. Persons who are unemployable due to alcohol or drug addiction are not eligible for general assistance. Persons receiving general assistance on July 26, 1987, or becoming eligible for such assistance thereafter, due to an alcohol or drug-related incapacity, shall be referred to appropriate assessment, treatment, shelter, or supplemental security income referral services as authorized under chapter 74.50 RCW. Referrals shall be made at the time of application or at the time of eligibility review. Alcoholic and drug addicted clients who are receiving general assistance on July 26, 1987, may remain on general assistance if they otherwise retain their eligibility until they are assessed for services under chapter 74.50 RCW. This subsection (6)(a)(ii)(B) shall not be construed to prohibit the department from granting general assistance benefits to alcoholics and drug addicts who are incapacitated due to other physical or mental conditions that meet the eligibility criteria for the general assistance program;

(iii) Are citizens or aliens lawfully admitted for permanent residence or otherwise residing in the United States under color of law; and

(iv) Have furnished the department their social security account number. If the social security account number cannot be furnished because it has not been issued or is not known, an application for a number shall be made prior to authorization of assistance, and the social security number shall be provided to the department upon receipt.

(b) Notwithstanding the provisions of subsection (6)(a)(i), (ii), and (c) of this section, general assistance shall be provided to the following recipients of federal-aid assistance:

(i) Recipients of supplemental security income whose need, as defined in this section, is not met by such supplemental security income grant because of separation from a spouse; or

(ii) To the extent authorized by the legislature in the biennial appropriations act, to recipients of aid to families with dependent children whose needs are not being met because of a temporary reduction in monthly income below the entitled benefit payment level caused by loss or reduction of wages or unemployment compensation benefits or some other unforeseen circumstances. The amount of general assistance authorized shall not exceed the difference between the entitled benefit payment level and the amount of income actually received.

(c) General assistance shall be provided only to persons who are not members of assistance units receiving federal aid assistance, except as provided in subsection (6)(a)(ii)(A) and (b) of this section, and will accept available services which can reasonably be expected to enable the person to work or reduce the need for assistance unless there is good cause to refuse. Failure to accept such services shall result in termination until the person agrees to cooperate in accepting such services and subject to the following maximum periods of ineligibility after reapplication:

(i) First failure: One week;

(ii) Second failure within six months: One month;

(iii) Third and subsequent failure within one year: Two months.

(d) The department shall adopt by rule medical criteria for general assistance eligibility to ensure that eligibility decisions are consistent with statutory requirements and are based on clear, objective medical information.

(e) The process implementing the medical criteria shall involve consideration of opinions of the treating or consulting physicians or health care professionals regarding incapacity, and any eligibility decision which rejects uncontroverted medical opinion must set forth clear and convincing reasons for doing so.

(f) Recipients of general assistance based upon a finding of incapacity from gainful employment who remain otherwise eligible shall not have their benefits terminated absent a clear showing of material improvement in their medical or mental condition or specific error in the prior determination that found the recipient eligible by reason of incapacitation. Recipients of general assistance based upon pregnancy who relinquish their child for adoption, remain otherwise eligible, and are not eligible to receive benefits under the federal aid to families with dependent children program shall not have their benefits terminated until the end of the month in which the period of six weeks following the birth of the recipient's child falls. Recipients of the federal aid to families with dependent children program who lose their eligibility solely because of the birth and relinquishment of the qualifying child may receive general assistance through the end of the month in which the period of six weeks following the birth of the child falls.

(7) "Applicant"‑-Any person who has made a request, or on behalf of whom a request has been made, to any county or local office for temporary assistance.

(8) "Recipient"‑-Any person receiving temporary assistance and in addition those dependents whose needs are included in the recipient's assistance.

(9) "Standards of assistance"‑-The level of income required by an applicant or recipient to maintain a level of living specified by the department.

(10) "Resource"‑-Any asset, tangible or intangible, owned by or available to the applicant at the time of application, which can be applied toward meeting the applicant's need, either directly or by conversion into money or its equivalent: PROVIDED, That an applicant may retain the following described resources and not be ineligible for public assistance because of such resources.

(a) A home, which is defined as real property owned and used by an applicant or recipient as a place of residence, together with a reasonable amount of property surrounding and contiguous thereto, which is used by and useful to the applicant. Whenever a recipient shall cease to use such property for residential purposes, either for himself or his dependents, the property shall be considered as a resource which can be made available to meet need, and if the recipient or his dependents absent themselves from the home for a period of ninety consecutive days such absence, unless due to hospitalization or health reasons or a natural disaster, shall raise a rebuttable presumption of abandonment: PROVIDED, That if in the opinion of three physicians the recipient will be unable to return to the home during his lifetime, and the home is not occupied by a spouse or dependent children or disabled sons or daughters, such property shall be considered as a resource which can be made available to meet need.

(b) Household furnishings and personal effects and other personal property having great sentimental value to the applicant or recipient, as limited by the department consistent with limitations on resources and exemptions for federal aid assistance.

(c) A motor vehicle, other than a motor home, used and useful having an equity value not to exceed one thousand five hundred dollars.

(d) All other resources, including any excess of values exempted, not to exceed one thousand dollars or other limit as set by the department, to be consistent with limitations on resources and exemptions necessary for federal aid assistance. The department shall also allow recipients of aid to families with dependent children to exempt savings accounts with balances up to an additional one thousand five hundred dollars which may only be used to make rental deposits, cover moving expenses, auto repair, household appliance repair and replacement, clothing, holiday and birthday expenses, and other incidental expenses.

(e) Applicants for or recipients of general assistance may retain the following described resources in addition to exemption for a motor vehicle or home and not be ineligible for public assistance because of such resources:

(i) Household furnishings, personal effects, and other personal property having great sentimental value to the applicant or recipient;

(ii) Term and burial insurance for use of the applicant or recipient;

(iii) Life insurance having a cash surrender value not exceeding one thousand five hundred dollars; and

(iv) Cash, marketable securities, and any excess of values above one thousand five hundred dollars equity in a vehicle and above one thousand five hundred dollars in cash surrender value of life insurance, not exceeding one thousand five hundred dollars for a single person or two thousand two hundred fifty dollars for a family unit of two or more. The one thousand dollar limit in subsection (10)(d) of this section does not apply to recipients of or applicants for general assistance.

(f) If an applicant for or recipient of public assistance possesses property and belongings in excess of the ceiling value, such value shall be used in determining the need of the applicant or recipient, except that: (i) The department may exempt resources or income when the income and resources are determined necessary to the applicant's or recipient's restoration to independence, to decrease the need for public assistance, or to aid in rehabilitating the applicant or recipient or a dependent of the applicant or recipient; and (ii) the department may provide grant assistance for a period not to exceed nine months from the date the agreement is signed pursuant to this section to persons who are otherwise ineligible because of excess real property owned by such persons when they are making a good faith effort to dispose of that property: PROVIDED, That:

(A) The applicant or recipient signs an agreement to repay the lesser of the amount of aid received or the net proceeds of such sale;

(B) If the owner of the excess property ceases to make good faith efforts to sell the property, the entire amount of assistance may become an overpayment and a debt due the state and may be recovered pursuant to RCW 43.20B.630;

(C) Applicants and recipients are advised of their right to a fair hearing and afforded the opportunity to challenge a decision that good faith efforts to sell have ceased, prior to assessment of an overpayment under this section; and

(D) At the time assistance is authorized, the department files a lien without a sum certain on the specific property.

(11) "Income"‑-(a) All appreciable gains in real or personal property (cash or kind) or other assets, which are received by or become available for use and enjoyment by an applicant or recipient during the month of application or after applying for or receiving public assistance. The department may by rule and regulation exempt income received by an applicant for or recipient of public assistance which can be used by him to decrease his need for public assistance or to aid in rehabilitating him or his dependents, but such exemption shall not, unless otherwise provided in this title, exceed the exemptions of resources granted under this chapter to an applicant for public assistance. In determining the amount of assistance to which an applicant or recipient of aid to families with dependent children is entitled, the department is hereby authorized to disregard as a resource or income the earned income exemptions consistent with federal requirements. The department may permit the above exemption of earnings of a child to be retained by such child to cover the cost of special future identifiable needs even though the total exceeds the exemptions or resources granted to applicants and recipients of public assistance, but consistent with federal requirements. In formulating rules and regulations pursuant to this chapter, the department shall define income and resources and the availability thereof, consistent with federal requirements. All resources and income not specifically exempted, and any income or other economic benefit derived from the use of, or appreciation in value of, exempt resources, shall be considered in determining the need of an applicant or recipient of public assistance.

(b) If, under applicable federal requirements, the state has the option of considering property in the form of lump sum compensatory awards or related settlements received by an applicant or recipient as income or as a resource, the department shall consider such property to be a resource.

(12) "Need"‑-The difference between the applicant's or recipient's standards of assistance for himself and the dependent members of his family, as measured by the standards of the department, and value of all nonexempt resources and nonexempt income received by or available to the applicant or recipient and the dependent members of his family.

(13) For purposes of determining eligibility for public assistance and participation levels in the cost of medical care, the department shall exempt restitution payments made to people of Japanese and Aleut ancestry pursuant to the Civil Liberties Act of 1988 and the Aleutian and Pribilof Island Restitution Act passed by congress, P.L. 100‑383, including all income and resources derived therefrom.

(14) In the construction of words and phrases used in this title, the singular number shall include the plural, the masculine gender shall include both the feminine and neuter genders and the present tense shall include the past and future tenses, unless the context thereof shall clearly indicate to the contrary.

Sec. 4. RCW 74.12.240 and 1959 c 26 s 74.12.240 are each amended to read as follows:

The department is authorized to provide such social and related services as are reasonably necessary to encourage the care of dependent children in their own homes or in the homes of relatives, to help maintain and strengthen family life and to help such parents or relatives to attain maximum self-support and personal independence consistent with the maintenance of continuing parental care and protection. The department may provide, where available, temporary child care and transportation related to program and work-related activities for recipients demonstrably in need where there are no other alternatives. In the provision of such services, maximum utilization of other agencies providing similar or related services shall be effected.

Sec. 5. RCW 74.12.245 and 1988 c 170 s 2 are each amended to read as follows:

The secretary of social and health services shall seek an exception to federal law under the waiver authorities set forth in the federal social security act, 42 U.S.C. Sec. 301 et seq., for the purposes of allowing recipients of aid to families with dependent children to become self-employed in a manner that will lead to economic independence. The application for waivers shall be sought by October 1, ((~~1988~~)) 1992.

If the waivers are obtained, the department shall adopt rules that allow a recipient to separate business assets from personal assets during a start-up period not exceeding two years. The rules shall provide for evaluation of business progress during the start-up period and, if it appears to the department that sufficient income exists to provide an adequate income to replace the aid to families with dependent children, the recipient has the burden of showing why the recipient is not ready to terminate the aid prior to the expiration of the start-up period.

The rules shall also provide for deductions from income for business expenses including but not limited to capital expenditures, payments on the principal of loans to the business and reasonable amounts for cash reserves.

Any program operated under this section shall be operated in cooperation with any demonstration project on self-entrepreneurship operated by the employment security department.

NEW SECTION. Sec. 6. Eligible applicants for aid to families with dependent children with a residency of fewer than six months shall receive a grant equal to the lesser of the amount provided in the state of previous residence or Washington state. If the grant is based on the grant level in another state, it shall remain in effect for six months, after which it shall increase to the amount provided in Washington state.

NEW SECTION. Sec. 7. Eligible applicants for aid to families with dependent children shall receive a grant based on the family size at the time of application to include children born and yet-to-be born. The grant amount shall not be increased for the addition of any subsequent children.

NEW SECTION. Sec. 8. At the time of application for aid to families with dependent children, the applicant shall:

(1) Provide the name, last known address, and place of employment of the absent parent, a copy of any court order regarding divorce, dissolution, child custody, child support, alimony, or spousal support;

(2) Complete an education, employment, and vocational skills assessment; and

(3) Birth certificates of all dependent children.

NEW SECTION. Sec. 9. Eligible applicants for aid to families with dependent children who are under the age of twenty who do not have a high school diploma or GED at the time of application shall enroll in, and show satisfactory progress toward completion of, a high school or a GED degree within six months of application for at least ninety days. Failure to do so shall result in termination from the program. A recipient is exempt from this section if (1) he or she is the parent of a child under three months of age, living in the home; or (2) child care is needed for the teenager to attend school, but licensed or certified child care is not available; or (3) transportation to and from child care is needed for the recipient's child and there is no transportation available.

NEW SECTION. Sec. 10. Recipients of aid to families with dependent children shall enter into a contract with the state of Washington specifying the rights and responsibilities of each party for the subsequent six months. The contract shall include a list of all benefits for which the recipient is eligible and the responsibilities required to receive those benefits. The contracts shall also specifically state that the grant amount shall not be increased for the addition of any additional children subsequent to the time of initial application to the program. Contracts shall be renegotiated on a six-month basis for the duration of the recipient's receipt of aid to families with dependent children. The contract may be renegotiated under limited emergency circumstances specified by the department by rule.

NEW SECTION. Sec. 11. Recipients of aid to families with dependent children who have children enrolled in kindergarten through eighth grade shall be responsible for their children's classroom attendance. They shall receive a warning the first time their child receives three or more unexcused absences in one month. If a recipient's child fails to meet the attendance requirement in any subsequent month, the recipient's grant shall be reduced by twenty percent for each month. If a recipient's child fails to meet the attendance requirement three or more months in one school year, the recipient shall lose his or her grant for at least ninety days. The recipient may reapply for assistance after the ninety-day period.

NEW SECTION. Sec. 12. The following copayments shall apply to all medical treatment provided to recipients of aid to families with dependent children and their dependents:

(1) All visits to county health departments and community health clinics shall have no copayment;

(2) All visits to physicians shall have a ten-dollar copayment; and

(3) All visits to hospital emergency rooms shall have a twenty-five-dollar copayment.

NEW SECTION. Sec. 13. (1) Forty percent of the funds collected under section 12 of this act shall be deposited in the basic health plan trust account created under RCW 70.47.030.

(2) Sixty percent of the funds collected under section 12 of this act shall be retained and the organizations or individuals specified in section 12 (2) and (3) of this act.

(3) The secretary shall establish rules for the collection and distribution of funds under subsection (1) of this section.

NEW SECTION. Sec. 14. Able-bodied recipients of aid to families with dependent children who have completed a high school or GED degree or are over twenty years of age and have received benefits for six months shall participate in community enhancement activities. The maximum number of hours required per month shall be determined by dividing the grant level by three times the higher of the state or federal minimum wage. For the purposes of this section, "community enhancement activity" means work for nonprofit organizations such as food banks, shelters, senior citizen programs, and cities.

NEW SECTION. Sec. 15. The department shall petition the federal government for waivers under the family independence program and the jobs opportunities and basic skills programs. Under the terms of the waiver, recipients of public assistance who are in job training programs shall not have the amount of their public assistance grants reduced to offset the income received from financial aid, including scholarships, grants, and loans, or internship or work-study employment related to their specific job training program.

NEW SECTION. Sec. 16. Upon the effective date of the waivers granted under section 15 of this act, recipients of public assistance under the family independence program and the jobs opportunities and basic skills programs shall not have their public assistance grants reduced to offset the income received from internship or work-study employment that is related to their job training programs.

NEW SECTION. Sec. 17. Recipients of aid to families with dependent children shall receive transitional benefits for eighteen months after the recipient finds employment or until the recipient's income reaches one hundred fifty percent of the grant level established by RCW 74.04.770, whichever occurs first. Transitional benefits include services provided under RCW 74.12.240 and medical assistance under chapter 74.09 RCW.

At the end of the transition period, the department, whenever possible, shall expedite the transfer of eligible recipients to the Washington basic health plan under chapter 70.47 RCW.

NEW SECTION. Sec. 18. Grant payments to recipients of aid to families with dependent children shall be reduced to offset income only to the extent that for every one dollar of earned income, recipients would have their grant payment reduced by seventy-five cents to a combined maximum of one hundred fifty percent of the grant standard.

NEW SECTION. Sec. 19. The department shall, within existing staffing, investigate all complaints of fraud involving public assistance. The department shall prepare an annual report to the appropriate committees of the legislature that includes: (1) The number of complaints received; (2) the number of complaints investigated; and (3) the results of the investigations. The department shall identify the cost associated with conducting investigations under this section.

NEW SECTION. Sec. 20. In addition to any action authorized under RCW 74.04.300, 74.08.290, 74.08.331, 74.08.335, and 74.08.338, an individual who has defrauded the aid to families with dependent children program is prohibited from collecting any benefit from the program for a period of ten years. Every effort shall be made to recover the defrauded amount.

NEW SECTION. Sec. 21. Individuals eligible to receive aid to families with dependent children may receive a maximum of seventy-two cumulative months of assistance. For the first forty-eight months the recipient shall receive one hundred percent of the grant payment; for the last twenty-four months the recipient shall receive fifty percent of the grant payment. If the individual leaves the program before reaching the seventy-second month, the individual shall re-enter the program and be eligible for only the balance of the seventy-two month period remaining at the time of departure. An individual who exhausts seventy-two months of assistance may reapply for aid to families with dependent children only after sixty months have elapsed since the period of ineligibility.

NEW SECTION. Sec. 22. The department shall provide the current amount of the grant designated for housing directly to the landlord of a recipient of aid to families with dependent children.

NEW SECTION. Sec. 23. The department shall petition the federal government for waivers from all applicable rules necessary to ensure that the provisions of sections 3, 6 through 22, 25, and 29 of this act are implemented.

NEW SECTION. Sec. 24. Recipients of public assistance may receive a maximum of three years of higher education. For recipients who have a four-year degree or postgraduate degree, an acceptable education program shall be limited to vocational training.

NEW SECTION. Sec. 25. (1) As used in this section:

(a) "Benefits" means benefits provided under the program of aid to families with dependent children established pursuant to P.L. 1959, c. 86.

(b) "Eligible parent" means a person who is or would be eligible for benefits based upon the income of that person and the person's natural children.

(2) An eligible parent who is married to a person who is not the parent of one or more of the eligible parent's children shall not be eligible for benefits if the household income exceeds the state eligibility standard for benefits. However, the eligible parent's natural children shall be eligible for benefits according to a sliding income scale established by the secretary that does not take into account the income of the eligible parent's spouse, if the total annual household income does not exceed one hundred fifty percent of the official poverty level, adjusted for family size, established pursuant to section 673(2) of Subtitle B, the community services block grant act of P.L. 97-35 (42 U.S.C. Sec. 9902(2)). The spouse of the eligible parent and the spouse's natural child, if any, who is not the eligible parent's natural child, who is living with the family shall not be eligible for benefits.

NEW SECTION. Sec. 26. The administrative cost of operating the public assistance program shall not exceed twenty-five percent of the total cost of providing public assistance to eligible recipients in the state of Washington.

NEW SECTION. Sec. 27. The secretary of social and health services shall adopt rules as necessary, under chapter 34.05 RCW, to implement sections 6 through 29 of this act.

NEW SECTION. Sec. 28. The department is prohibited from providing recipients with personal property items such as, but not limited to, appliances, furniture, automobiles, and automobile parts.

NEW SECTION. Sec. 29. Sections 6 through 28 of this act shall be implemented initially in King, Pierce, Snohomish, and Spokane counties. The secretary shall implement a schedule to phase-in the remaining counties.

NEW SECTION. Sec. 30. Sections 6 through 29 of this act are each added to chapter 74.12 RCW.