California Welfare Rights Organization v. Carleson

• Decision Date: 25 March 1971
• Citation: 93 Cal.Rptr. 758,4 Cal.3d 445
• Court: California Supreme Court
• Parties: , 482 P.2d 670 CALIFORNIA WELFARE RIGHTS ORGANIZATION et al., Petitioners, v. Robert B. CARLESON, as Director, etc., et al., Respondents. CALIFORNIA WELFARE RIGHTS ORGANIZATION et al., Plaintiffs and Respondents, v. Robert B. CARLESON, as Director, etc., Defendant and Appellant. Sac. 7884, 7887.

Page 758

93 Cal.Rptr. 758

4 Cal.3d 445, 482 P.2d 670

CALIFORNIA WELFARE RIGHTS ORGANIZATION et al., Petitioners, v. Robert B. CARLESON, as Director, etc., et al., Respondents.

CALIFORNIA WELFARE RIGHTS ORGANIZATION et al., Plaintiffs and Respondents, v. Robert B. CARLESON, as Director, etc., Defendant and Appellant.

Sac. 7884, 7887.

Supreme Court of California In Bank.

March 25, 1971.

Peter E. Sitkin, San Francisco, Ralph Santiago Abascal, Marysville, Sidney M. Wolinsky, San Francisco, Valerie Vanaman, Long Beach, and Daniel S. Brunner for petitioners, and plaintiffs and respondents.

Karlton & Blease and Coleman A. Blease, Sacramento, as amici curiae on behalf of petitioners, and plaintiffs and respondents.

Evelle J. Younger, Atty. Gen., N. Eugene Hill and Jay S. Linderman, Deputy Attys. Gen., for respondents, and defendant and appellant.

BURKE, Justice.

These two consolidated cases involve the amounts of and standards for computing welfare grants made under the Aid for Dependent Children (AFDC) program, and the authority and obligations with respect thereto of the Director of the California Department of Social Welfare. ¹

In Sac. No. 7887, in an action brought by certain recipients of AFDC grants and by an unincorporated association, ² the Superior Court of Sacramento County issued a preliminary injunction enjoining the director from implementing or enforcing certain regulations he had issued relating to AFDC grant payments. ³ The director appeals, and has also sought to halt further proceedings below. We issued the alternative writ of prohibition.

In Sac. No. 7884 the petitioners are the same parties as the parties plaintiff in the superior court action in Sac. No. 7887; i.e., certain recipients of AFDC grants and an association undertaking to represent them. (See fn. 2, Ante.) Petitioners seek mandamus to (1) compel respondent Director of the California Department of Social Welfare to set aside certain of the regulations above mentioned and to increase the AFDC grants; and (2) compel respondent Director of the Department of Finance to authorize expenditures for such increased AFDC grants. ⁴ We issued the alternative writ.

As will appear, we have concluded that those regulations pertaining to the food allowance of AFDC grants and to the imposition of a 'percent reduction' to the total budgetary needs of recipients are invalid because in violation of California statutes, but that the regulation establishing new and increased schedules of maximum grants is authorized and should be upheld.

Section 401 of the Social Security Act (42 U.S.C. § 601) makes federal funds available 'for making payments to States which have submitted, and had approved by the Secretary (of Health, Education, and Welfare), State plans for aid and services to needy families with children.'

These cases arose out of California's undisputed failure, prior to the orders referred to in footnote 3, Ante, to take steps to bring about cost-of-living adjustments required by section 402(a)(23) of the Social Security Act as amended in 1968 (42 U.S.C. § 602(a)(23)) ⁵ if California's plan was to remain eligible for federal funds; neither the maximums sets forth in subdivision (a) of section 11450 of the Welfare and Institutions Code, ⁶ last adjusted in 1961, ⁷ nor the need standards fixed under section 11452 of the same code ⁸ had been adjusted to reflect current increased living costs.

However, in response to the orders to which we adverted in footnote 3, ante, the director, on November 19, 1970, promulgated emergency regulations designated as EAS sections 44--212, 44--313 and 44--315. EAS 44--212 revised the dollar amounts employed in computing family budgets to meet the need standards under section 11452 (see fn. 8, Ante); EAS 44--313 raised the maximums stated in section 11450, subdivision (a) (fn. 6, Ante); and EAS 44--315 provided that AFDC grants would be limited to 69 percent of a family's minimum need.

Meanwhile, in August 1970 the U.S. Department of Health, Education, and Welfare (HEW) held a hearing on the questions of whether California's plan complied with the requirements of the Social Security Act and whether further federal grants could be made to California. On January 8, 1971, that department's decision was rendered. It held that California was out of compliance with the federal act in failing to update its maximums on AFDC grants, and ordered that further federal financial assistance for the California AFDC program be withheld until such time as the California AFDC plan conforms to the requirements of section 402(a)(23) of the Social Security Act. The HEW decision relates, inter alia, that in December 1970 HEW had received amendments to the California plans (apparently emergency regulations EAS 44--212, 44--313, and 44--315) and had found them acceptable, but was aware that their validity was under challenge in the California courts. ⁹ Following issuance of the HEW decision, the decision was on the same day (January 8, 1971), withdrawn and rescinded by HEW at the request of California's Governor, pending final resolution of the litigation now before us in which validity of the emergency regulations is at issue.

In Rosado v. Wyman (1970) 397 U.S. 397, 90 S.Ct. 1207, 25 L.Ed.2d 442, the United States Supreme Court, faced with the task of interpreting section 402(a) (23) of the Social Security Act (Ante, fn. 5), first noted (pp. 408--409, 90 S.Ct. p. 1216) that although states participating in the AFDC program must comply with the terms of the federal legislation, 'the program is basically voluntary and States have traditionally been at liberty to pay as little or as much as they choose, and there are, in fact, striking differences in the degree of aid provided among the States.

'There are two basic factors that enter into the determination of what AFDC benefits will be paid. First, it is necessary to establish a 'standard of need,' a yardstick for measuring who is eligible for public assistance. Second, it must be decided how much assistance will be given, that is, what 'level of benefits' will be paid. On both scores Congress has always left to the States a great deal of discretion. (Citation.) Thus, some States include in their 'standard of need' items that others do not take into account. Diversity also exists with respect to the level of benefits in fact paid. (Fn. omitted.) Some States impose so-called dollar maximums on the amount of public assistance payable to any one individual or family. Such maximums establish the upper limit irrespective of how far short the limitation may fall of the theoretical standard of need. Other States curtail the payments of benefits by a system of 'ratable reductions' whereby all recipients will receive a fixed percentage of the standard of need.'

Turning to the language of section 402(a)(23), the Court declared (pp. 412--414 of 397 U.S. p. 1218 of 90 S.Ct.) that 'we find two separate mandates: first, the States must reevaluate the component factors that comprise their need equation; and, second, any 'maximums' must be adjusted.

'We think two broad purposes may be ascribed to § 402(a)(23): First, to require States to face up realistically to the magnitude of the public assistance requirement and lay bare the extent to which their programs fall short of fulfilling actual need; second to prod the States to apportion their payments on a more equitable basis. Consistent with this interpretation of § 402(a)(23), a State may, after recomputing its standard of need, pare down payments to accommodate budgetary realities by reducing the percent of benefits paid or switching to a percent reduction system, but it may not obscure the Actual standard of need.

'The Congressional purpose we discern does not render § 402(a)(23) a meaningless exercise in 'bookkeeping.' Congress, sometimes, legislates by innuendo, making declarations of policy and indicating a preference while requiring measures which, though falling short of legislating its goals, serve as a nudge in the preferred directions. In § 402(a)(23) Congress has spoken in favor of increases in AFDC payments. While Congress rejected the mandatory adjustment provision in the administration bill, it embodied in legislation the cost-of-living exercise which has both practical and political consequences.

'It has the effect of requiring the States to recognize and accept the responsibility for those additional individuals whose income falls short of the standard of need as computed in light of economic realities and placing them among those eligible for the care and training provisions. Secondly, while it leaves the States free to effect downward adjustments in the level of benefits paid, it accomplishes within that framework the goal, however modest, of forcing a State to accept the political consequence of such a cutback and bringing to light the true extent to which actual assistance falls short of the minimum acceptable. Lastly, by imposing on those States that desire to maintain 'maximums' the requirement of an appropriate adjustment, Congress has introduced an incentive to abandon a flat 'maximum' system, thereby encouraging those States desirous of containing their welfare budget to shift to a percentage system which will more equitably apportion those funds in fact allocated for welfare and also more accurately reflect the real measure of public assistance being given.'

With respect to the plan of the State of New York, which was at issue, the holding was that New York had 'impermissibly lowered its standard of need by eliminating items that were included prior to the enactment of § 402(a)(23).' (P. 416 of 397 U.S., p. 1219 of 90 S.Ct.)

Thus it appears clear that if regulations EAS 44--212 and 44--313 issued by the director (revising need standards and raising maximums) are valid under California law, then as related in the HEW decision (see Ante, fn. 9 and accompanying text) they will serve to bring...