Fiscal Note - SB 0023 - Designates How Missouri Will Respond to The Personal Responsibility & Work Opportunity Act of 1996-Welfare Reform
L.R. NO. 0450-01
BILL NO. SB 23
SUBJECT: Welfare Reform
TYPE: Original
DATE: January 24, 1997
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None
Total Estimated
Net Effect on All
State Funds $0 $0 $0
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
Officials from the Department of Mental Health (DMH) indicate that this
legislation would have no fiscal impact on their agency because it stipulates
that where the Personal Responsibility and Work Opportunity Reconciliation
Act (PRWORA) is inconsistent with the state's waiver provisions, that the
waiver provisions would apply.
Officials from the Department of Economic Development, Division of Job
Development and Training, the City of Springfield, and the City of St. Louis
indicated this legislation would have an unknown impact on their agency.
Officials from the Department of Labor, Division of Employment Security
indicate an unknown fiscal impact to their agency. The Division of
Employment Security (DES) is currently under contract with the Division of
Family Services (DFS) for placement service of participants in the FUTURES
program, so a portion of the participants affected by this legislation are
already being served by DES. It is assumed the remaining portion will also
be referred to DES for assessment and placement service under the new
program. It is also assumed the number of remaining participants would cause
an increase in the workload of an estimated five to ten percent. This
increase is above and beyond the current contractual agreement with DFS. DES
has not received any new federal funds to support the new welfare reform
initiatives; therefore, there may be a substantial negative impact on current
federal funds for administration. However, since the legislation does not
specifically address the role of DES, the fiscal impact is not measurable at
this time.
Officials from the Department of Social Services, Division of Legal Services
state that until it is decided which portions of the PRWORA will be adopted,
the fiscal impact on the division is unknown. Much of the welfare reform
effort involves increased child support enforcement initiatives which will
ultimately create a need for attorneys to serve as hearing officers and legal
counsel, plus additional staff to support them in this effort.
Officials from the Department of Social Services, Division of Child Support
Enforcement and Division of Family Services indicate this legislation would
not have a fiscal impact on their agencies. However, they also note that
they expect to see specific federal mandates in future proposed legislation
that will result in significant impacts in the child support enforcement
program and its operations.
Officials from the Department of Health (DOH) anticipate additional costs as
families currently receiving government subsidies enter the work force,
creating an increase in the number of children requiring child care services.
Additional staff will be needed to inspect, license, and monitor the child
care facilities for compliance with state statutes and licensing rules. DOH
estimates the costs associated with this legislation would be $653,107,
$1,554,639, and $2,358,997 in FY98, FY99, and FY00, respectively.
According to DOH, the Division of Family Services has confirmed that
approximately 78,990 families in Missouri are receiving government subsidies
in FY97. Approximately 25% or 19,748 of those families will be required to
enter the work force in FY97. An increasing percentage will be required to
enter the workforce each successive year. There are approximately 1.5
children per household. This will create the need for child care for
approximately 29,622 additional children in FY97. However, it is estimated
that approximately 21,622 of these children will already be receiving child
care services in FY97. Therefore, it is estimated that 8,000 additional
children will need child care services in FY97. This 8,000, along with a 5%
increase each year, is used as the basis for calculating need in FY98, FY99
and FY2000, as additional families are required to enter the workforce. DFS
estimates that this legislation will create the need for child care services
for 8,400 additional children in FY98, 8,820 in FY99, and 9,261 in FY2000.
Based on the current distribution of children in child care facilities with
above and below 50 children in care, and family child care homes providing
care for ten children, it is estimated that in FY98, there will be 25% or
2,100 additional children in facilities with less than 50 children, 7% or
588 in facilities with more than 50 children, and 68% or 5,712 in care in
family child care homes. In FY99, it is estimated that 25% or 2,205
additional children will be in care in facilities with less than 50 children,
7% or 617 will be in facilities with more than 50 children, and 68% or 5,998
will be in care in family child care homes. In FY2000, it is estimated that
25% or 2,315 will be in facilities with less than 50, 7% or 648 will be in
facilities with more than 50, and 68% or 6,298 will be in family child care
homes.
Based on an average size of 30 children in child care facilities with less
than 50 children; 70 in facilities with more than 50 children; and ten in
family child care homes, this will require the addition of the following
licensed child care facilities in FY98, FY99, and FY2000:
FY98 FY99 FY2000
Child care centers with less than 50 children 70 73 77
New child care centers with more than 50 children 8 9 9
Family child care homes with ten children 571 600 630
Total new child care facilities 649 682 716
Based on a caseload size of 50 facilities per Child Care Licensing
Representative, this will require the addition of 13 new Child Care Licensing
Representatives and four Clerk Typist II's in FY98. In FY99 14 new Child
Care Licensing Representatives and 4 Clerk Typist II's will be needed. In
FY2000 14 new Child Care Licensing Representatives and 4 Clerk Typist II's
will be needed. Even though there will be a 5% increase in the number of
children requiring care in FY99, it will have no significant impact on the
total number of new child care facilities or the need for additional staff.
Oversight assumes the intent of this proposal is to serve as a "mission
statement" in stating that the state will take a proactive position in
enforcing the terms of the PRWORA. This does not appear to designate
specific policies on how the state will implement specific federal mandates;
therefore, Oversight assumes this legislation will not have a fiscal impact
on these agencies.
FISCAL IMPACT - State Government FY 1998 FY 1999 FY 2000
(10 Mo.)
0 0 0
FISCAL IMPACT - Local Government FY 1998 FY 1999 FY 2000
(10 Mo.)
0 0 0
FISCAL IMPACT - Small Business
No direct fiscal impact to small businesses would be expected as a result of
this proposal.
DESCRIPTION
This legislation would proactively enforce the terms of "The Personal
Responsibility and Work Opportunity Reconciliation Act of 1996" (PRWOA) and
support the provisions certified, as outlined, in the plan submitted to the
U.S. Department of Health and Human Services on September 30, 1996, for funds
from Temporary Assistance for Needy Families Block Grant.
The act states that Missouri will (1) operate a child support enforcement
program, (2) operate a foster care and adoption assistance program, (3)
designate the Missouri Department of Social Services to administer and
supervise the Missouri Children and Family Assistance Program, (4) establish
and enforce standards and procedures to ensure against program fraud, and (5)
elect to establish and enforce standards to screen, identify, refer clients
and to waive certain program requirements for individuals receiving
assistance who have been victims of domestic violence or face other barriers
to becoming self-sufficient.
It would continue to operate the Missouri Families Mutual Responsibility and
21st Century Communities Demonstration Plan waivers and apply them in all
instances where they are inconsistent with PRWOA.
It also provides that the Department of Social Services ensures that needy
children and families receive assistance; the state maximizes its receipt of
federal funds; limited child care funds and funds for work, education and
training programs are provided to families most likely to be able to move
from welfare to work; persons unemployed through no fault of their own are
not penalized by Missouri's new welfare programs; client privacy protection
measures be continued; and uniform standards of eligibility are implemented
statewide.
This legislation is federally mandated, will affect state revenues, will
require additional rental space, and would not duplicate any other program.
SOURCES OF INFORMATION
Department of Social Services
Department of Economic Development
Department of Labor
Department of Health
Department of Mental Health
St. Louis City
City of Springfield
NOT RESPONDING: St. Louis County, Jefferson-Franklin Counties
This Fiscal Note is not an official copy and should not be quoted or cited.