After Years of Deep Cuts, an Increase in the CalWORKs Grant Deserves Serious Consideration

Today, members of the California Legislature will meet in Budget Conference Committee to continue resolving differences between the Senate and Assembly’s versions of the 2013-14 state budget. One important item up for discussion is the size of monthly grants for families in the CalWORKs Program, which provides cash assistance to low-income families along with welfare-to-work services to help parents find jobs and overcome barriers to employment.

The Senate and the Brown Administration have proposed keeping the CalWORKs grant frozen at its current level, while the Assembly has proposed a phased-in increase that would raise the maximum grant to 50 percent of the federal poverty line over a five-year period, starting with a 12 percent increase January 1, 2014.

After years of steady decline in the purchasing power of the CalWORKs grant, followed by sharp cuts to the grant in recent years, the $638 maximum aid payment for a family of three is currently equal to about 39 percent of the poverty line, well below the “deep poverty” cutoff of 50 percent. To put things in perspective, today’s cash grant is roughly the same, in actual dollars, as the maximum grant in 1987. The critical difference is that back then, the value of that dollar amount was equal to about 80 percent of the poverty line — or double the percentage today.

The Assembly proposal to increase the CalWORKs grant acknowledges the fact that California is facing a serious poverty problem. This problem came into sharp focus last year when the Census Bureau released state rankings under the new Supplemental Poverty Measure, which compares families’ resources to the cost of housing and other necessities. California was perched at the top of the list, with 23.5 percent of residents living in poverty. Even under the official poverty measure — the basis for the federal poverty line — about one in six Californians, and nearly one in four California children, are living in poverty. (For a family of three, this means an annual income below $19,530.)

The fact that so many of the state’s children experience this daily hardship is deeply troubling in and of itself. But child poverty’s effects extend far beyond individual households. Since children who grow up in poverty are likely to have lower earnings, less education, and poorer health as adults, poverty affects all Californians who care about a strong workforce and a robust tax base for the state.

Augmenting the CalWORKs grant would help address poverty in California by lifting the household income of CalWORKs participants, who make up a large share of the state’s low-income families. Such an increase would directly benefit the more than 1 million children in CalWORKs households. Depending on how the change is implemented, the 12 percent increase in the CalWORKs grant that the Assembly proposes for 2013-14 could bring the maximum grant for a family of three from its current $638 level up to about $714 a month — still below where it was 10 years ago. This change, though modest, would be a step in the right direction after years of repeated cuts to the CalWORKs grant.

— Hope Richardson