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Welfare Reform in New York City: The Measure of Success

The Committee on Social Welfare Law

Introduction

The most recent version of welfare reform[1] in New York City, dating back to the early days of the administration of Mayor Rudolph Giuliani, has been repeatedly characterized as an unqualified success.  During that time, the City’s public assistance rolls have fallen by more than half, from 1.1 million in July 1995 to 497,113 in July 2001,[2] with the decline attributed to economic prosperity and policies enacted by the mayor's Human Resources Administration that restructured application procedures and created stringent work requirements.

A closer look at conditions affecting the city's poor puts into question the actual success of these measures.  As welfare reform was begun, food stamp participation decreased by twenty-six percent between January 1996 and March 1999.  At the same time, requests for emergency food aid increased from January 1998 to January1999  by thirty-six percent: 73,832 people were turned away from emergency food aid, 43,766 of them children, or an estimated 1,400 children per day.[3]

At the same time, use of the city's homeless facilities far exceeded their occupancy, sheltering over 6,000 families with 15,000 children on any given night.[4]  In addition, litigation against the city by advocates for the poor has exposed important legal deficiencies affecting due process, civil rights, and equal protection.[5]

This report presents (1) an overview of welfare reform, tracing developments from the federal legislation of 1996 and state legislation adopted the following year, to welfare policies implemented in New York City; (2) a review of data from numerous studies by public and private agencies;[6] and (3) some alternative poverty reform proposals for consideration by future New York City administrations.


I.  An Overview of Welfare Reform

A.        Federal Welfare Reform

At the federal level, efforts to revise the public assistance system culminated with the enactment of the Personal Responsibility and Work Opportunity Act (PRA), which was signed into law in August 1996 by then-President Clinton.  The PRA abolished Aid to Families with Dependent Children (AFDC), the national program for children and families that had been created by the Social Security Act of 1935, and replaced it with Temporary Assistance to Needy Families (TANF).  TANF differs from AFDC in four key ways.

First, AFDC funding created an entitlement for eligible families to receive welfare payments and reimbursed the state for a certain percentage of the expenditures; TANF has block grant funding, under which a state gets a fixed dollar amount of federal funding.  The block grant funding makes benefit increases less likely because the state must pay 100 percent of the cost of any expansions.

Second, TANF eliminates families’ federal statutory entitlement to receive aid even when they qualify for public assistance under prescribed need standards.   States may also deny aid to children as a sanction for parental misconduct, which AFDC had generally forbidden.[7] 

Third, TANF is time-limited, restricting a family’s right to receive federal aid to a maximum cumulative total of five years (60 months).  The cumulative total includes not only time receiving welfare benefits, but also childcare and other TANF-funded subsidies that are designed to support families who are transitioning from welfare to work.  Starting in 2001, hundreds of thousands of needy families throughout the nation will begin exhausting their federally funded TANF benefits and face destitution unless states are willing to aid them with state funds.

Fourth, TANF work rules tend to discourage education and training and encourage assignment to such activities as job search and workfare[8].

In addition to repealing AFDC, the PRA discontinued federally funded benefits for most legal immigrants making many ineligible unless they become naturalized citizens, a process which usually requires a waiting period of years, among other requirements.  These exclusions have had a harsh impact on communities with large immigrant populations, such as New York City where about forty percent of the population is foreign-born.[9]

Welfare reform is again on the federal agenda because TANF has a sunset provision under which the program will expire in 2002 unless reauthorized by Congress.  Given the fact that the transition to work has not been successful for a large group of former recipients, the expiration of TANF presents another critical juncture in the evolution of public assistance policies affecting the poor.[10]

B.        State Welfare Reform

Welfare reform in New York State can be distinguished from reform in many other states because Article XVII of the New York State Constitution requires the state to care for needy New Yorkers.  While most other states have no state-funded general assistance programs, New York law mandates continued welfare benefits for all needy families and individuals, including those who have lost their eligibility for federally funded benefits.[11]

The state responded to the PRA with the Welfare Reform Act of 1997.[12]   This legislation changed the names of the two components of New York’s welfare system from AFDC and Home Relief to Family Assistance (FA) and Safety Net Assistance (SNA).   FA generally covers households with children (the TANF population) and SNA covers households without children.  The eligibility criteria and related rules in both programs are similar.

While recognizing that the state’s constitution prohibits arbitrary time limits on assistance, the governor and the legislature mandated that recipients should move to a more restrictive benefits program.  This proposal provided for a transfer from cash aid to “non-cash” aid after a household had received FA for five years or SNA for two years, with benefit redemption for goods and services through an electronic debit card system.  The state planned to contract with Citicorp Electronic Financial Services, Inc. to produce the electronic benefits transfer (EBT) debit cards and manage the system.  For those receiving “non-cash” aid, welfare would pay rent and utilities directly to the landlord and utility company and issue a small cash allowance.[13]

Four years later, the non-cash plan (never implemented) was withdrawn by the Pataki administration following concerns by the state comptroller's office about the failure to secure agreement from sufficient merchants to make it operational.  A study by the state attorney general's office also discovered that, under the current system that uses EBT cards to dispense regular welfare benefits, ninety percent of businesses in the city's low-income neighborhoods were refusing to accept the card to retrieve cash or were applying a surcharge for every transaction.[14]  State officials and advocates for the poor were also leery of enlarging on the Citicorp contract, based on its poor performance for the past two years in the regular cash benefits system.[15] 

At present, no revised program for implementing Safety Net Assistance has been announced by the Pataki administration.

The new state work rules essentially track the more restrictive federal pattern.  For example, exemptions from the work requirements are primarily limited to people with serious mental or physical disabilities and parents caring for a child less than twelve months old.  The new rules also give localities substantial discretion over the types of activities to which work program participants will be assigned.

C.        City Welfare Reform

Because the incidence of poverty is much higher in the city than in the rest of the state, the city has about seventy percent of the state’s welfare recipients and pays about seventy percent of welfare’s total local share, even though the city accounts for only about forty percent of the state’s population.  In both the city and the state, over half of welfare recipients are children.

New York is one of the minority of states in which welfare is still administered by local government, rather than by state government.   New York City and each of the counties outside the city are responsible for administering welfare in the local area and for paying roughly twenty-five percent of the overall cost. As welfare’s gatekeepers, local governments have a significant impact upon the size and well being of the local population.

Welfare reform in New York City actually began early in the Giuliani administration, well in advance of the 1996 federal legislation, and intensified with the changes in federal and state law and the arrival of Jason Turner as commissioner of the Human Resources Administration.  Their policies, which launched a dramatic reduction in the number of persons receiving assistance, have been characterized by an ever-increasing number of administrative obstacles and an overarching emphasis on workfare as the primary activity.

State welfare policy gives local governments great discretion in assigning welfare recipients to work program activities.  Under the Giuliani administration, HRA has placed the highest priority on assigning recipients to the Work Experience Program (WEP) and imposing stringent sanctions on those who fail to comply.  WEP requires recipients to "work off" their cash and food stamp benefits at a government or non-profit site, with the hours of work based on the minimum wage rather than the prevailing wage for the activity performed. 

While an unprecedented upsurge in the economy reduced the need for assistance, the caseload reduction far exceeded the reduction in poverty.  It remains too early to judge the ultimate impact of welfare reform, but life for many poor families, those who continue to receive public assistance and those who have left the rolls, remains a constant struggle, too often with no improvement in their material well being.[16]  

Full utilization of welfare benefits and support programs, in conjunction with advocates who can insure access, could help many of these fragile families to move out of poverty.


II.   The Reality of New York City's Welfare Reform

Mayor Giuliani has stated repeatedly that his administration’s goal is to eliminate welfare.[17]  But a close look at the harsh conditions faced by the poor in New York City belies the administration's assertion that a reduction in the caseload may be equated with the successful implementation of welfare reform.

Although the city provides little data on what happens to individuals when their public assistance is terminated,[18] numerous independent studies conducted by public and private organizations have concluded that reform has made life for those living at or below the poverty line far worse.[19] 

This section summarizes data collected since the implementation of welfare reform, discussing administrative diversion, disinformation and discrimination, the administrative hearing process, the Work Experience Program, and privatization.  The studies conclude that hunger and homelessness remain high despite an unprecedented economic boom and the lowest unemployment rate in a generation.

A.        Diversion, Misinformation and Discrimination

New York City’s Human Resource Administration (HRA), the agency charged with implementing welfare reform, has adopted aggressive, agency-wide diversion and misinformation policies that both discourage individuals from applying for public assistance and encourage those able to negotiate the process to discontinue that assistance as soon as possible.         

1.         Diversion.  In 1997, Mayor Giuliani brought Jason Turner to New York from Wisconsin, where he had been credited with dramatically reducing the welfare caseload, to become Commissioner of HRA.[20]  One of his first major initiatives was to begin the conversion of the city’s “Income Support Centers,” which had provided primary access to a variety of welfare-related services, into “Job Centers,” designed to emphasize workfare requirements and drastically reduce public assistance rolls. 

The Job Center initiative generated widespread controversy, prompted investigations by two federal agencies, and was the target of federal litigation, Reynolds v. Giuliani.[21]  The Reynolds plaintiffs claimed that staff at the Job Centers were preventing people from applying for Medicaid, food stamps, cash assistance, and emergency assistance in violation of federal and state statutory and constitutional law.  A District Court judge agreed,[22]

(a) finding that New York City Job Centers illegally discourage destitute individuals and families from applying for Food Stamps, Medicaid and cash assistance and deny them such assistance; (b) enjoining the city from converting any more Income Support Centers to Job Centers; and (c) ordering city officials to develop a corrective action plan, to comply with the law, and to continue an informal process to address individual cases of urgent need.[23]

The injunction of the conversion of the Income Support Centers to Job Centers was lifted two years later in March 2001, but the remaining provisions of the injunction continue

Job Centers operate under a policy called "diversion," pursuant to which applicants are dissuaded from filing applications.  Those who do apply are required to participate in a full-time schedule of job search and other activities, well before any benefits have been provided.  The basis for the diversion policy and for many other features of the Giuliani-Turner governance of HRA[24] (repeatedly articulated by Commissioner Turner) is an attempt to create a crisis in welfare recipients' lives, precipitating such dire prospects as hunger and homelessness, so that they will be forced to seek some alternative to public assistance.[25]

The city diverts individuals in numerous ways.  HRA trains workers to discourage potential applicants from pursuing benefits by insisting that they seek assistance from virtually any conceivable alternative, from friends, to family, to churches, to credit cards.[26]  These “up-front” strategies are particularly damaging in that, prior to the filing of a completed application, individuals are unlikely to be aware of their procedural rights.  Applicants who are successfully “diverted” do not appear in any statistical compilations and are not provided with notice of their right to challenge agency findings, such as would be received following a formal rejection of an application.  

In the event that an individual succeeds in filing an application for public assistance, HRA requires applicants to immediately begin a rigorous regimen that includes daily appointments at the welfare office to comply with various work requirements.  Interviews at other locations are also required.  The first is Eligibility Verification Review (EVR) in Brooklyn, followed by an EVR home visit during which the city again verifies information the applicant presented in the initial application interview.

Families with children are then sent to the Child Support Enforcement Unit at another location in Brooklyn where they are required to provide information about paternity and child support, irrespective of their domestic situations.  Failure to comply results in denial of benefits to the custodial parent, even though the parent's genuine inability to obtain requested information should not result in this sanction.  

Individuals with conditions that might limit their ability to work receive multiple appointments for medical or psychiatric evaluations at Health Services Systems (HSS), a private, for-profit agency under contract with the city.

 If applicants miss an appointment or fail to comply with a directive from any of these offices, they are required to begin the entire application process anew. 

A foreseeable consequence of this diversion policy is that thousands of eligible individuals are improperly denied assistance.  An independent study in July 2000 reported that over forty percent of individuals interviewed as they were applying for public assistance were re-applicants whose earlier applications had been denied.[27]  Fifty-eight percent of those applicants who had applied for public assistance two or more times had never been informed of their right to request an administrative fair hearing.[28]  As noted above, the Reynolds lawsuit had exposed the same problem in 1998.

2.         Withholding Information.  The city also engages in a misinformation campaign that discourages eligible public assistance applicants and recipients from receiving the benefits to which they are entitled, regardless of the circumstances in which they live.[29]  The impending five-year time limit on public assistance benefits mandated by TANF legislation will begin to affect recipients in December 2001.  This cessation of federal eligibility has allowed the city to implement a damaging misinformation campaign in its effort to reduce the number of persons receiving public assistance: HRA systematically fails to inform and misinforms low-income New Yorkers about their eligibility for the state's Safety Net Assistance–Non-Cash program, which will provide benefits for those who reach the TANF time limit.[30]

Misinformation about time limits is conveyed by instructions to welfare caseworkers and reinforced by misleading notices and posters hanging on welfare center walls.[31]  Notices are sent to welfare recipients stating that their time limits for Cash Assistance will expire this year and inviting them in to discuss “how you plan to manage your household expenses once your limits for Cash Assistance expire.”  The notice simply fails to inform clients that the state will continue to provide benefits for as long as the client is eligible.

Likewise, the city does not provide applicants and recipients with information regarding their right to childcare, a critical component of humane and effective welfare-to-work strategies.[32]  In fact, the city has a legal obligation to assist parents in finding appropriate, available childcare in order to assign them to WEP programs.[33] 

A study completed in 2000 found that almost half of the parents surveyed had been threatened by their caseworkers with sanctions if they did not get childcare.  More than half did not receive the mandatory assistance from their caseworkers in locating such care, leaving most to rely on informal care or risk improper sanctions.  And while the law entitles parents to formal childcare in a licensed preschool or childcare program when appropriate, a study of New York City’s welfare childcare policies found ninety-five percent of parents surveyed were not told by their caseworkers that they would be exempted from sanctions if they could not work because they did not have childcare, despite federal, state and city policies that require that this information be given to parents.[34] 

3.         Discrimination.  Although the city’s diversion policy results in the violation of the rights of the poor in general,[35] the discrimination is particularly harsh against vulnerable populations, including those (1) with mental disabilities, (2) living with HIV and AIDS, (3) fleeing domestic violence, (4) with substance abuse problems, and (5) with limited literacy and English proficiency.

Persons with Mental Disabilities.  Reports on the mental status of welfare recipients indicate that very few individuals make it through the bureaucracy of the application process, which requires verification of housing status, citizenship status, past employment, family composition, and medical history.  To obtain an exemption from WEP, applicants must obtain current supporting documents from treating health practitioners for submission to Health Services Systems, an agency under contract with HRA to conduct medical and psychiatric screening of those claiming disability status.  Without Medicaid, clients are frequently unable to obtain treatment or reports for extended periods of time and are therefore unable to substantiate their disabilities.

A recent study on depression found that forty-two percent of heads of households receiving TANF meet the criteria for clinical depression, more than three times the national average.[36]  In surveying the homeless population, researchers for Better Homes Fund found that forty-five percent of women in shelters suffer from major depression and more than one-third have post-traumatic stress disorder.[37]  New York City’s public assistance system is not equipped recognize applicants' mental disabilities or provide appropriate accommodations for those who suffer from such conditions.  Without the support of family, friends, and advocates, persons with such disabilities and their children are likely to continue to be at risk for loss of assistance.

Persons Living with HIV and AIDS.  After taking office in 1994, Mayor Giuliani sought to eliminate the city's Division of AIDS Services and Income Support (DASIS), a unit within HRA that was established to assist those welfare applicants and recipients living with AIDS to access and maintain their public assistance benefits.  Public protest and litigation thwarted the mayor, but the struggle continues. 

In Hernandez v. Barrios-Paoli,[38] advocates challenged HRA's imposition of Eligibility Verification Review (EVR) on DASIS clients.  Under EVR, clients were required to travel to Brooklyn for a second interview after their initial application and submit to an unscheduled home visit; this required them to remain in their homes for days at a time, conflicting with scheduled medical appointments.  Unless and until clients complied, their benefits were interrupted, delayed, or discontinued.  In October 1999, the New York Court of Appeals, in a unanimous decision, ordered EVR discontinued for DASIS clients, finding that "investigations for DASIS clients contravene one of the intended purposes of Local Law 49:  to ease unnecessary administrative burdens for public assistance applicants suffering from clinical/symptomatic HIV illness or AIDS in New York City."[39]

In Henrietta D. v. Giuliani,[40] a class of 25,000 DASIS clients alleged that the city and state, through DASIS, systematically failed to accommodate the disabilities of DASIS clients by not providing timely subsistence benefits.  After five years of litigation and a bench trial, the Court found that the city and state were "chronically and systematically failing to provide plaintiffs with meaningful access to critical subsistence benefits and services, with devastating consequences."[41]  The judge ruled that the evidence at trial "and defendants own data painted a picture of an agency that routinely fails to provide access, meaningful or otherwise, to its clients."[42]

 As set forth in Henrietta D., the city did not meet the legal time frame in providing DASIS clients with benefits in thirty-three percent of the cases, and up to forty-five percent at some centers.  "In practical terms," the judge, "this means that thousands of indigent New Yorkers living with AIDS stand an almost fifty-fifty chance of having their rights violated by this agency, rights to critical subsistence benefits for which they have been determined fully eligible."[43]

Similarly in Hanna v. Turner,[44] petitioners challenged the city's violation of Section 21-128(b) of the New York City Administrative Code (upon which DASIS is based), which requires the city to ensure the provision of medically appropriate transitional and permanent housing for eligible persons with clinical/ symptomatic HIV illness or with AIDS.  DASIS staff routinely denied immediate housing to recently hospitalized clients, regardless of inclement weather conditions.[45]  Throughout the litigation, the city asserted that it was permitted twenty-four hours from the time of the request to provide housing for this homeless, medically needy population. 

In November 1999, the New York Supreme Court required that the city comply immediately with all terms of the provision.  However, as recently as June 2001, the court cited the Giuliani administration for contempt in failing to do so, stating that the city had "repeatedly violated [the] 1999 court order that it provide medically appropriate transitional housing for people with AIDS."[46]

 Persons with Domestic Violence Issues.  The TANF Family Violence Option requires HRA to screen welfare applicants and recipients for domestic abuse issues and provide victims with necessary assistance, including access to services and an exemption from WEP and other requirements.  However, a 2000 survey reports that HRA fails to screen clients, inform victims of available services, or refer self-identified clients for services.[47] 

Commissioner Turner, in an address at the Rockefeller Institute, accused women of pretending to be victims in order to obtain exemptions from obligations, leading advocates to believe the administration encourages caseworkers to ignore the Family Violence Option and leaves families to continue to suffer from domestic abuse.[48]  Because a significant percentage of women receiving welfare are victims of domestic violence[49] and ninety-two percent of mothers in homeless shelters have been sexually or violently abused,[50] such an approach constitutes a major impediment to the discharge of legally mandated public assistance.

Persons with Substance Abuse Problems.  People with drug and alcohol problems constitute one of the most difficult segments of the welfare population.  HRA's efforts to address substance abuse issues have often disregarded the rights of the recipients and ignored the judgments of treatment providers and professionals.  For example, the city's plan to search Medicaid payment records for evidence that welfare recipients had in the past sought drug or alcohol treatment was attacked by a New York Times editorial, decrying the violation of federal confidentiality laws.[51] 

Public criticism terminated the initiative, but people with substance abuse problems continue to face numerous obstacles in negotiating the welfare system.  Perhaps most disturbing, HRA has adopted its own procedural guidelines to which treatment providers must adhere as a condition of receiving HRA referrals.  Such policies as characterizing relapse as non-compliant behavior, mandating treatment for all relapses, using untrained HRA staff to oversee the transfer of treatment clients between different levels of care, and wide-spread use of urinalysis were challenged by the New York State Association of Alcoholism & Substance Abuse Providers,[52] ultimately resulting in some modification of these punitive actions.[53] 

Nevertheless, HRA’s priority of moving recipients into work activities and off the welfare rolls poses a constant challenge and threat for those in need of treatment.  Although state law suggests that treatment can be mandated only for those recipients found unemployable by reason of their substance abuse problem,[54] HRA routinely assigns recipients to both treatment and work activities.  For some percentage of the affected population, this may be appropriate, but for many others, it ensures that they will be sanctioned for alleged non-cooperation.

Despite the fact that substance abuse forms one of the greatest barriers to employment, HRA has yet to develop practical and humane treatment programs that support full recovery in welfare recipients, preferring to rely on punitive measures that do not move clients to functional independence.

Persons with Literacy and Language Issues.  In October 1999, following an investigation in response to advocate complaints, the U.S. Department of Health and Human Services found that New York City welfare offices regularly fail to provide adequate language assistance to public assistance applicants and recipients who have limited English proficiency (LEP),[55] resulting in the improper denial of public assistance.[56]

Those who do not speak either English or Spanish are particularly disadvantaged.  Even those who speak Spanish reported significant problems when communicating with HRA workers.[57]  Another survey found that less than ten percent of South East Asian adults and their children received translation services when they need them, and forty-eight percent believe that their public assistance grants were improperly reduced solely because of language barriers.[58] 

Because the city denies necessary translation services, children of LEP parents are compelled to translate for their parents at welfare centers.[59]  Over eighty-six percent of the children interviewed for the same survey admitted that they had missed school so that they could accompany their parents to the welfare office.[60]  As damaging to children as this practice is in general, it creates special problems when the LEP client is asked to divulge sensitive information such as HIV/AIDS or domestic violence particulars as a prerequisite to obtaining benefits.

The failure to accommodate LEP clients extends to the hearing impaired community, as well, when welfare offices rarely provide translators proficient in American Sign Language and do not provide auxiliary aids and services to the hearing-impaired, thus denying disabled clients the opportunity to effectively communicate with HRA workers regarding their subsistence needs.[61]

B.        The Administrative Hearing Process

A series of federal lawsuits filed in the late 1960's and early 1970's established that any notice of action to change a welfare benefit generates access to the so-called "fair hearing" process.  Until welfare reform, New York City appellants' win rate at these administrative hearings consistently hovered around ninety percent.[62]  Due process had real meaning for welfare applicants and recipients, providing an unbiased forum in which to challenge improper actions that denied, reduced or discontinued benefits to which they were entitled under federal and state law.

As new workfare requirements were established, the viability of this process was compromised.  Hearings on issues related to non-workfare matters were held as usual at the state's office building at 80 Centre Street before the same administrative law judges (ALJ), who continued to find in favor of the appellants in ninety percent of the cases. 

The setting for work-related hearings was moved to HRA’s Office of Employment Services at 109 East 16th Street, with appellants appearing before a newly hired group of judges.  These state hearings, now housed at the city's site, were attended by new city representatives who had been trained to aggressively defend HRA determinations.  The result was fewer settlements and a precipitous decline in the appellant win rate from ninety percent to fifty-five percent.[63]

A major factor contributing to the city's success was the manner in which HRA evaluated recipients' claims that their medical disabilities should exempt them from participation in work program activities.  Health Services Systems, the for-profit company under contract with the city to review disability claims, performed perfunctory physical examinations using physicians who could not or did not communicate with the clients and, according to recipients' testimony at administrative hearings, disregarded and sometimes discarded their personal physician recommendations and test results.[64]  Clients who challenged the employability determinations were rarely able to overturn the city's claims at these sophisticated hearings because they did not possess sufficient documentation, and, due to funding cutbacks for public interest law offices, were unable to obtain legal representation.[65]

Even more distressing was the perceived bias of the state's administrative law judges (ALJ) in favor of the city, also documented in hearing transcripts.[66]  In an effort to level the playing field, legal advocates met with the state's deputy counsel for administrative hearings to address the problem.  The result was a directive to ALJs regarding compliance with due process procedures, the importance of conducting unbiased hearings, and the necessity of a full and complete record on the issues.[67]

Although judges generally followed the directive when attorneys were present, ongoing review of unfavorable hearing decisions showed little difference when clients appeared pro se, as confirmed in February 1998 by Lewis v. Barrios-Paoli,[68] which overturned an unfavorable state hearing decision on appeal.

In Lewis, the issue concerned the alleged failure of the appellant to cooperate with workfare requirements.  In the decision, the judge described the "fair hearing" as neither "fair" nor a "hearing" in that the appellant was denied the opportunity to present her case, and the decision was not based on the merits of the case, the evidence, or the issue upon which the hearing was requested.  The court also noted, referring to the hearing transcript, that the state's ALJ had elicited no testimony from the city's representative, clearly conducting the hearing on the city's behalf while the appellant appeared without counsel.[69]

At the time, the court reserved judgment as to whether the state and city's behavior constituted a pattern.  Fifteen months later, however, in Martinez v. Turner,[70] the same court found a discernable pattern by state and city commissioners who “disregarded their own rules, regulations, consent decrees, and due process essentials in sanctioning” participants in the workfare program.[71]

The Martinez decision asserts that the state ALJ “obviously failed to understand the applicable law,” violated a number of mandatory procedures at the hearing, and was “arbitrary and capricious and violative of petitioner’s due process rights."[72]  The court went further, quoting from an appellate decision:

A welfare agency does not fulfill its legislative mandate by operating under a policy that extends benefits only to those persons who are sufficiently familiar with the law to effectively demand them.  Social welfare programs are, by their nature, intended to assist the least sophisticated members of society.  The ‘safety net’ provided by the program is ineffectual if the most vulnerable among us are allowed to slip through.[73]

Despite these strong admonitions, seven months later a different judge overturned a fair hearing decision with equally vociferous language, writing: “There are a number of troubling aspects to the manner in which the agencies carried out their statutory mandates….  [T]he [state] agency is bound by both the [New York City Human Resources Administration – NYCHRA] and its own policy guidelines to implement public assistance in a fundamentally fair manner.  In reviewing [appellant's] fair hearing transcript and decision, the court finds that NYCHRA and the state agency failed to follow many of the procedural requirements to ensure fundamental fairness."[74]

C.        The Work Experience Program

One of the fundamental themes underlying welfare reform is the idea that recipients must perform some form of work in exchange for the benefits they receive.  Often referred to as “workfare,” the program is formally known in New York State as the Work Experience Program (WEP).  WEP generally requires welfare recipients to work for up to thirty-five hours weekly as a condition to receiving their grants and without the benefits that would normally accrue to employees.  The cost to the city for an hour of workfare is $1.80, based on the city’s share of the welfare check.[75] 

The WEP Program has transformed New York City’s public sector into a two-tier system of workers: union workers, who are reasonably compensated in wages and benefits, and WEP workers, who perform many of the same tasks for below poverty-level wages under constant threat of sanctions.[76]  The difficulties inherent in navigating the work program bureaucracy are reflected in the sheer volume of public assistance sanctions generated monthly by that program.  For example, according to HRA's records in March 1999, 7,271 Safety Net Assistance recipients were in the sanction process that month, representing twelve percent of the entire nonexempt Safety Net Assistance caseload, approximately one in every eight cases.[77]

WEP workers are also threatened with sanctions by supervisors who engage in sexual and racial discrimination.  For the past five years, the U.S. Equal Employment Opportunity Commission (EEOC) has been investigating such claims by female WEP participants.  In a report released in October 1999, which stated that welfare recipients in workfare programs fall under anti-discrimination laws to the same extent as other employees, the Giuliani administration was charged with violating federal law by turning away women who made complaints.  The EEOC advised these workers to bring private lawsuits against their harassers and criminal assault charges against male supervisors where appropriate.[78]

Workers' attempts to remedy these complaints against the administration were unsuccessful.  Nearly two years later, on July 15, 2001, the U.S. attorney in Manhattan announced a federal suit against the Giuliani administration for failing to protect women in workfare jobs and for subjecting four women to a hostile work environment by not responding vigorously after they complained of sexual or racial harassment.  A spokesman for Mary Jo White, U.S. Attorney, said the government "brought the lawsuit only after efforts at negotiating a settlement of the harassment claims failed."  Employment law experts note that "it is unusual for the federal government to accuse a city of not doing enough to stop sexual harassment." [79]

A private attorney for one of the plaintiffs said that "the Giuliani administration had refused to commit to improving conditions" following the EEOC findings in October 1999.  The lawsuit was filed with the approval of Attorney General John Ashcroft. [80]

Although the administration suggests that workfare participants develop skills that ensure subsequent employment, WEP does little to lift people out of poverty.[81]  As an HRA study indicated, thirty-three percent of those who left welfare had not worked at all since their cases were closed, and forty-two percent were jobless at the time the city interviewed them.[82]  In the same study, the city found that forty-eight percent of those who were employed said that their income was equal to or less than their welfare distributions, and only fifty-one percent of those working received health care coverage from their employer or Medicaid, even though all remained eligible for Medicaid by virtue of poverty-level wages.[83]  Advocates have long contended that thousands of poor families leaving welfare have had their Medicaid coverage improperly terminated, a problem soon to be rectified as a result of a July 11, 2001 settlement in federal district court in Mangracina v. Turner in which the city agreed to reinstate over 40,000 affected individuals and reimburse them for out-of-pocket medical expenses accrued due to their improper termination from Medicaid.[84]

Besides WEP's failure to provide a meaningful transition from welfare to work, failing to provide adequate and appropriate transitional childcare, without which recipients are unable to comply with WEP participation requirements or find and sustain regular employment, may contribute to the city’s overall unemployment rate. 

Statistics on this issue are abundant and compelling.  A 1999 study found that thirty-six percent of parents were either unable to work or lost their jobs due to lack of quality childcare.[85]  When the New York City Public Advocate examined HRA's childcare policies and practices, researchers found that the city’s system was a chaotic and ineffective bureaucracy that failed to ensure “that children are being cared for in safe, appropriate childcare settings, frequently contradict[ing  HRA's] own mandates and undermin[ing] parents’ efforts to become self-sufficient.”[86]  Given the state legislature's new budgetary cutbacks in childcare subsidies amounting to $304 million for the coming fiscal year,[87] we cannot expect to see the city's situation remedied anytime soon.

While the city has long stressed that parents who participate in WEP are providing good role models for their children, a Child Trends study by the Manpower Demonstration Research Corporation on the effects of workfare on these parents' adolescent children uncovered significantly different outcomes.[88]  Adolescents whose welfare recipient parents are required to engage in workfare activities have lower academic achievement and more behavior problems than children in welfare households where mothers remain in the home.[89]  In all three target locations (Florida, Minnesota, and Canada), "there were no positive impacts [on adolescents of parents participating in welfare-to-work programs] in any of the studies."[90]

Researchers hypothesized that parents have less time and energy to monitor adolescent behavior, that the stress of working might result in harsher parenting styles, or that adolescents are assuming more responsibilities at home, particularly childcare, thus creating too great a burden.  Whatever the cause, the study found that these adolescents engaged in increased smoking, drinking, drug use, and delinquent activity, did worse in school on measures such as performing at grade level, and were more likely to act out in school than adolescents whose mothers received welfare but did not participate in work programs.[91]

The city's refusal to recognize education and training programs as satisfying WEP work requirements is another major flaw in the program.  At every level, from literacy and basic education to two- and four-year college programs, public assistance recipients are routinely denied the right to participate in education and training and are instead assigned to WEP activities that teach few skills and rarely lead to employment.  For example, before HRA began to systematically force recipients out of college programs or deny new recipients the opportunity to engage in such activities, approximately 28,000 individuals received welfare and attended a CUNY school.  By the year 2000, that number had diminished to fewer than 6,000.[92] 

Although strongly opposed by Mayor Giuliani, the New York State Legislature amended the Social Services Law in January 2001 to permit students to count their hours in work-study programs or internships toward their weekly workfare requirement.  Yet in June 2001, six months after the law took effect, few HRA caseworkers were aware of the law.  As a result, students are required to challenge workers' erroneous and improper determinations through the lengthy, costly, and time-consuming administrative hearing process in order to keep their benefits and stay in school.[93] 

Finally, WEP displaces thousands of city workers who should be employed to do the work that WEP workers do at nominal cost to the city.  While the majority of WEP workers are performing entry-level jobs, many are placed in more complex jobs with higher degrees of responsibility.  HRA may assign a WEP worker to jobs ranging from keeping parks clean and safe, to doing light repair work, to painting, to office duties.

One study found that by 1999, the Giuliani administration had raised WEP participation from a few thousand to nearly 40,000.[94]  At least eighty-six percent of those surveyed reported doing the same work as municipal employees.[95]  As the WEP work force was dramatically increasing, New York City's municipal labor force was reduced by 20,000, with WEP workers now doing the tasks that these workers had previously performed.[96]

D.        Privatization

At every level of government, the most recent round of welfare reform has encouraged the contracting out of a wide range of services traditionally provided by the public sector.  Many public services have been “privatized” for years, but welfare reform legislation, coupled with the Giuliani administration’s strong support for the concept, have combined to substantially expand the use of private contracts by HRA. 

The City Project, an advocacy group that focuses on the New York City budget and the way in which the city allocates its funds, estimates that contracts for human services now represent eleven percent of the city budget.[97]  This administration has also made extensive use of “sole-source” contracts, awarded without competitive bidding based on claims of "urgency."

This report will not review the many arguments for and against privatization but will note some of the concerns raised when government services are extensively contracted out.[98]

In its 2000 report, City Project called the city’s contracting practices “random, decentralized, and unaccountable,” despite 1989 New York City Charter revisions designed to improve accountability.  Indeed, HRA’s 1999-2000 plans to award $500 million in contracts for a variety of basic welfare-related functions were deferred by the city comptroller for several months due to a lack of necessary information and apparent irregularities.[99]  While the contracts were eventually approved,[100] the episode served to highlight a number of causes for concern with regard to privatization efforts:

(a)        Contracting to for-profit agencies.  As huge contracts to companies like Lockheed Martin and Maximus proliferate, a critical question must be raised:  To what extent does a corporation's commitment to a profit lead it to unduly cut costs and services?  

(b)        Performance-based standards.  Few would oppose the proposition that both government and private agencies should be evaluated on the basis of performance.  But reasonable and appropriate criteria for measuring performance must be established.  Thus while it may be entirely appropriate to insist that a job placement company demonstrate a significant number of successful job placements, it may be unrealistic to insist on immediate job placements from a provider of basic literacy instruction.

(c)        Accountability.  The issue of private agency accountability will inevitably be explored by means of litigation because there is no clear present answer to the question of a private agency's accountability to its clients for the agency's abuse of discretion or transgression of applicable legal standards.  For example, are a private entity's records, compiled pursuant to a government contract, readily available under Freedom of Information Laws?  If hearings are requested and the relevant records are in the control of a private agency, who is responsible to ensure that they are properly preserved and produced at appropriate times?  If an actionable wrong is committed, what remedies are available and against whom do they apply?

(d)        Faith-based initiatives.  With the energetic support of the new Bush administration, it can be anticipated that faith-based groups will receive an increasing share of contract services.  In New York City, the Giuliani administration has undertaken one particularly noteworthy initiative, the so-called Faith-Based Demonstration Project.  Of particular concern in this instance is the fact that eligibility to perform this public function was limited to faith-based organizations, a restriction of dubious legality.

(e)        Processing delays.  One of the more troubling aspects of privatization in New York City concerns simply the delay involved in processing payments from the city.  A City Project study revealed that there is typically a delay of nearly four months from a contract award until the first payment to a community-based organization; in the case of HRA, the wait is generally 4½ months.  As a result, private agencies must often take out loans to survive until payments are commenced, or must delay the provision of services.[101]

E.         Hunger and Homelessness 

Any society's measure of its success must take into account the humane treatment of its members, including access to food and shelter for all.  Yet at a time when the country has experienced its most prolonged prosperity in history, hunger and homeless in New York City continue to rise.

            1.         Hunger.  In their zeal to eliminate dependency, city officials have routinely obstructed access to adequate food for low-income New Yorkers.[102]  Studies indicate that this obstruction coincides with a thirty-five percent drop in food stamp cases in New York City between 1996 and 1999, despite persistently high poverty rates of around twenty-four percent.[103]  Because the Food Stamp Program is the principal safeguard against hunger in this country, declining participation has led to increased demand at already over-burdened food pantries and soup kitchens.  Every day, approximately 400,000 New Yorkers suffer from moderate to severe, a figure that includes 118,000 children.[104]

A number of advocacy groups, as well as one City Council member, have documented increased use of food pantries[105] and the increased number of individuals turned away empty handed.[106]  These reports uniformly trace this deterioration in the quality of life to implementation of the city's welfare reform policies.  Notwithstanding a documented increase in demand for food by the needy, New York City regularly fails to make Food Stamp Program applications readily accessible to potentially eligible households and imposes eligibility requirements that exceed the standards set by the Food Stamp Act and regulations.[107]

            2.         Homelessness

The Giuliani administration did not invent the problem of homelessness; the causes are complex and longstanding, and satisfactory remedies remain elusive.  However, the city’s policies have made a bad situation unnecessarily worse. 

An August 2001 study reported that the number of homeless persons in New York City shelters is running thirty percent higher than last year, with officials expecting new records to be set in the coming winter.[108]  In July, a record 6,252 families with 11,594 children, or 20,655 members of homeless families, were in the shelter system, surpassing the previous high in the late 1980's and mid-1990's of 18,700.  Advocates report that the Giuliani administration, unlike the Koch and Dinkins administrations before, have abandoned the policy of creating low-cost housing to counter the rise in New York City housing costs.  The city's Department of Housing Preservation and Development, which produced 1,500 apartments each year during the Koch administration's initiative on homelessness, provided only 117 apartments in a nine-month period last year.[109] 

Since the late 1980's, the largest group of homeless persons is women and children.  Officials cite domestic violence, evictions and declines in subsidized housing as likely reasons for the rise in homeless families.[110]  Yet in the face of conditions that require greater numbers of families to seek public shelter, Martin Oesterreich, the city's commissioner of homeless services, was quoted as saying, "I can't screw the front door any tighter," in reference to the rigorous screening procedures begun by the Giuliani administration in 1996, hurdles that result in more families being turned away.[111]  Despite ongoing litigation on behalf of these families, each night approximately five-hundred eligible children and parents are given beds for one night only, forcing them to return to the screening unit in the South Bronx each morning to reapply.[112]

The continued disruption in the lives of these children results in long-lasting trauma.  In a study released in April 2001, the Institute for Children and Poverty  reported that the typical homeless child in New York City is five years old, has suffered an increase in emotional distress since becoming homeless, has had to change schools in the last year, is more than twice as likely to repeat a grade as a non-homeless child, is four times as likely to suffer from asthma, and receives primary medical care only in an emergency room or walk-in clinic.[113] 

The study also documented the correlation between benefit loss and homelessness.  Over half of homeless parents reported that their welfare benefits had been reduced or discontinued in the preceding year, forty-two percent reported losing their food stamps, and twenty-seven percent had experienced cuts in Medicaid.  One-fifth of parents who had their benefits reduced or cut in the last year reported becoming homeless as a result, while only ten percent reported finding a job as a result.  Of those who succeeded in finding a job, less than half were currently working.[114]

In Callahan v. Giuliani,[115] the administration's decision to use the status of an applicant's welfare case to determine eligibility for emergency shelter was enjoined based on a finding that welfare status was not a reliable indicator of whether the client had, in fact, complied with the requirements of HRA's programs.  The court found that applications are routinely denied and cases improperly discontinued, and that persons with language limitations, disabilities, or social dysfunction are particularly vulnerable to wrongful agency actions.[116]

For fifteen years, the city has been under court order to stop forcing homeless families to sleep on the benches and floors at the Emergency Assistance Unit (EAU), located in the Bronx, where families must apply in order to obtain immediate and long-term emergency housing.[117]  Although the EAU has never been a model of efficiency,[118] studies demonstrate that the city regularly denies applications for shelter, depriving families of any semblance of normal family life for weeks and months,[119] and consistently fails to provide legal notification of reasons for denials.[120]

As recently as April 2001, the Giuliani administration presented yet another plan to the court detailing how it will "rapidly add beds at homeless shelters and move hundreds of other families to permanent apartments" in an effort to avoid a contempt order for its mistreatment of homeless families.[121]  The chief assistant corporation counsel acknowledged that the city had been unable to live up to all of its pledges to relocate four-hundred-sixty families to subsidized apartments by the end of June; only nine families had been moved by April.[122]

As the accumulation of data in the foregoing discussion makes clear, using caseload reduction to evaluate the success of New York City's welfare reform programs is a meaningless and cynical exercise.  While there has been support for the abstract concept of workfare, its practical application has produced results that are wholly inconsistent with a strategy of moving people towards financial independence or of providing a true safety net for those in need.  Nonetheless, the city has both the resources and the expertise to reform the way we address poverty in future administrations with strategies set forth below.


Part III.  Alternative Proposals

Perhaps the most important information we have gained about welfare reform in New York City is that this administration's transformation of the system has focused upon caseload reduction, not remedying or alleviating poverty.  A substantial number of those who have left welfare have obtained employment and for some, this has meant an improvement in their living standard. 

But as the wealth of research described above indicates, even during a period of remarkable economic growth, many of those who have moved off welfare have struggled with low-paying and temporary jobs without employee benefits; many others have left the rolls without employment at all.  Many have moved to the streets and soup kitchens; the demand at shelters has never been greater.  For those remaining on welfare or in need of welfare, basic survival is an increasingly difficult challenge.  A realistic look at life in poverty suggests a number of urgently needed policy modifications.

A.        Easing Hardship for Welfare Recipients

            The most fundamental change is required to care for those with no choice but to rely on welfare: the grant in New York State, now unchanged in eleven years, must be substantially increased.  The real value of the grant has diminished by close to fifty percent since the mid-1970’s, such that meeting basic survival needs is virtually impossible in the typical case.  Yet the decline in the public assistance caseload combined with continuing state budget surpluses make a reasonable grant increase eminently affordable.

An important component of the reassessment of the welfare grant is the need for an honest, realistic examination of the shelter allowance.  The portion of the grant designated for housing bears no meaningful relation to the actual cost of housing in New York City.  Any of a range of alternatives would improve housing affordability.  These include:

  • a general increase in the public assistance grant, as discussed above, from which the recipient could allocate more funds for rent;
  • an increase in the housing portion of the grant, although we favor the general increase affording the recipient the ability to make allocation choices; and

  • the creation of a housing subsidy program similar to the federal Section 8 program, although we prefer an entitlement over the capped Section 8 benefit.

A separate housing subsidy has the advantage of not counting as income for food stamp budgeting purposes.[123]

B.        Easing Hardship for Those Leaving Welfare

While still campaigning for the presidency, Bill Clinton began to use the language, “making work pay.”  The central tenet of this policy is that no person employed full-time should be living in poverty.  Putting aside reservations about the welfare reform legislation he later signed, President Clinton’s proposals for making entry-level employment available should be pursued.[124]  Among key features designed to “make work pay” are:

  • a significant increase in the hourly minimum wage;
  • an expansion of both the size of the Earned Income Tax Credit and those households eligible to receive it;

  • a health care system that covers every employed person and his or her family; and

  • more widely available childcare resources.

 As Katherine Edin and Laura Lein note in Making Ends Meet,[125] many of those who leave welfare for employment suffer a net loss of income, due largely to the increased cost of childcare, health care, travel, and clothing.[126]  Adoption of the proposals outlined above would make substantial contributions toward alleviating this misfortune.

Finally, the housing crisis afflicts not only public assistance recipients, but also those households with higher incomes.  The New York Times recently reported on the panic of many of the more than two million residents of rent-stabilized apartments who are facing increases by the Rent Guidelines Board.[127]  Owners are having a hard time maintaining their buildings without higher rents, but tenants say that rent absorbs nearly their entire income, leaving less and less for food and other necessities.  Programs such as housing subsidies and incentives for rehabilitation and new construction, similar to those proposed for the welfare population, are also desperately needed for non-welfare, lower income families.

C.        Modifying the Administration of Welfare

1.         System Access 

Recent HRA practice has focused on diverting people who are seeking assistance, persuading them not to apply, to seek help elsewhere, or to save money by living doubled up with others.  People who do manage to apply often see their applications summarily rejected for failure to comply with any one of a multitude of often inappropriate and burdensome procedures, including onerous WEP requirements.

A fundamental change in the culture of the welfare system is urgently needed.  HRA, at every level of the hierarchy, must make clear that the system exists to provide assistance to people in need.  Only eligible people should receive benefits, but every New York resident is entitled to be informed of and to apply for benefits to which he or she might be entitled.  On the same day persons enter an Income Support or Job Center expressing a possible need for assistance, they must be permitted to commence the application process.

In addition, applicants should immediately be given the opportunity to apply for expedited benefits for emergency needs.  Preferably, no WEP assignments would be made while an application is pending, as a person applying for welfare is, by definition, experiencing crises often involving hunger and homelessness.  At a minimum, no assignment should be made until there has been a thorough evaluation of the individual’s employability.

2.         Special Populations

As difficult as it has become for anyone to negotiate the welfare system, it is often simply overwhelming for various subgroups of needy New Yorkers who are, for one or more reasons, exceptionally vulnerable.  Among these are people with disabilities including those with HIV/AIDS, the homeless, people with alcohol and substance abuse problems, people with limited literacy or English proficiency, and victims of domestic violence.  When people struggling with these challenges confront a complex, hostile welfare administration, they are likely to abandon the effort to pursue needed benefits, to have their applications rejected, or to have their benefits terminated for failure to comply with some administrative or WEP requirement.  The failure to serve these individuals may, in many instances, violate the Americans with Disabilities Act or the Rehabilitation Act of 1972.  But whether or not there is a legal violation, a system that effectively denies them assistance is morally unacceptable.

While the problems posed and, therefore, appropriate responses for each of these groups are in significant ways unique, there are common elements of an approach that should be adopted across the board. 

First, procedures must be adopted to identify the presence and severity of each individual's disability or limitation.  This may sometimes be relatively simple, requiring no more than medical verification or reliable self-reporting. In other instances, there may be complicating issues, such as applicant denial or incapacity or a special need for confidentiality, privacy, and trust.  Considerable research exists regarding the enhanced capacity of public agencies to identify and serve clients with one or more of these difficulties.  A good-faith review of the research and implementation of any of a number of potential program designs will substantially improve the situation.

Second, once the individual's problem has been identified, appropriate accommodations must be implemented.  Such accommodations, designed to ensure that benefits are not improperly denied solely because of administrative obstacles, should be applicable to all who need assistance.  But until there is a willingness to engage in such a dramatic, system-wide restructuring, at a minimum, procedures should be implemented to identify and serve these special needs populations. 

Some accommodations are relatively easy to identify.  For example, requirements that are duplicative or unnecessary should be eliminated; a simple reduction in the number of mandated application activities would correspondingly reduce the risk of non-compliance and consequent sanction.

A valuable addition to welfare administration would be the inclusion of protective measures to guard against inappropriate benefit rejections, terminations, or reductions.  For example, there should be in place a triggering mechanism whenever it appears that a special needs person has failed to comply with a mandated action.  Under usual circumstances, this would generate a notice of denial, termination or reduction of benefits, with prescribed methods for challenging this adverse action.  Unfortunately, those with disabilities may be no more capable of utilizing the means to challenge the action than they were able to comply with the initial requirement. 

This problem would be significantly mitigated if the initial failure to comply generated not a notice of adverse action, but rather triggered specified outreach efforts, e.g., phone calls, home visits, or contacts to designated relatives, friends, or service providers, to ensure that the failure to comply was not related to the individual’s disability.  Once again, a wide range of choices can be explored once the agency recasts its orientation away from caseload reduction and towards assisting the needy.

3.         Welfare to Employment

Determining Employability.  The first step in the process of assigning public assistance recipients to work activities is the determination of employability.  Closely related to the welfare system’s general treatment of people with disabilities, individuals who are unable or are seriously limited in their ability to engage in work activities are often improperly evaluated and determined to be employable.  The inevitable result is that recipients either jeopardize their health by trying to comply with inappropriate assignments or face sanctions for non-compliance.

Recipients must be better informed of their rights and obligations in the employability determination process and must be given ample time to secure medical documentation, with mandated agency assistance when needed.  HRA and its contract agencies must be directed to give appropriate weight to evidence provided by the individual’s treating health practitioners.  Once a valid determination has been made, the agency must use care to ensure that any assignment given is appropriate to the individual’s condition and limitations.

Access to Education and Training.  Since early in the Giuliani administration, HRA has actively discouraged recipient participation in education and training in favor of workfare.  As a result, few people have gained skills relevant to the labor market and few have obtained jobs as a result of their work activities, while a tremendous number of sanctions have been imposed for alleged non-compliance.  As the labor market increasingly demands higher levels of education and skill for living-wage employment, the city should respond by providing access to appropriate training and education for welfare recipients.  This should include access to every level of education, from literacy and English as a Second Language to post-secondary education.

The city may, consistent with state and federal law, permit and even encourage many more recipients to participate in more meaningful activities.  Indeed, many other states and even other counties in New York State permit a much wider array of activities to count as a recipient’s work-related involvement than is permitted in New York City.  Furthermore, legislation has been proposed in both the New York City Council and the state legislature that would authorize participation in a range of education and training activities to count towards meeting work requirements.  The next administration should actively support such legislative initiatives.

In addition, the successful implementation of a workfare program in which recipients are appropriately assigned requires a thorough, up-front assessment of their skills and education, as well as their particular training and service needs.  Although assessments are already provided for in the law, work assignments are currently made even before the assessment is conducted.  In addition, assessments tend to be perfunctory, and little genuine effort is made to assure that assignments reflect the outcome of the assessment.  The city should support legislative initiatives that mandate assessments before assignments can be made, that would guarantee that assessments be conducted by trained personnel, and that require reasonable efforts to conform assignments to the information gained in the assessment.

Reliance on Workfare.  New York City assigns a greater percentage of welfare recipients to workfare than any jurisdiction in the country.  As noted above, workfare has little or no value in helping people to move from welfare to employment.  Therefore, we reiterate our support for a dramatic reorienting of HRA practice, whether by reason of state or local legislation or as the result of a change in city policy, to permit, or better, to encourage recipients to engage in appropriate education and training as work-related activities.  To the extent that workfare will still be used as a work activity, HRA should be required to ensure that work assignments reflect the individual’s assessment in terms of skill strengths and deficits, preferences, and employment goals.  To the extent feasible in terms of civil service law and collective bargaining agreements, workfare assignments should readily be converted to actual offers of employment, perhaps after a period of successful participation.  Above all, all workfare participants should receive a

living wage, that is, a wage sufficient to lift them out of poverty.

D.        Privatization

 There may be settings in which the contracting out of city services is appropriate.  But safeguards must be implemented to ensure that the privatization of governmental functions does not lead to a diminution of services or a loss of accountability.

First, the contracting process must be thoroughly transparent, open and fair.  Even the appearance of bias undermines the credibility of the process.  In addition, measures must be in place to guarantee that privatization does not result in a dilution of public access to information or in a decline in agency responsibility and accountability.

Finally, a thorough public review should be undertaken concerning the issue of “charitable choice,” which involves contracting to faith-based providers.  While such providers have long played a critical role in the provision of social services, the perils to both the providers and to government of publicly funded, explicitly faith-oriented services merit considerable caution and debate before moving ahead.

V.  Conclusion

 As the end of the Giuliani era approaches, the next mayoral administration should abandon the policy of equating the success of welfare reform with caseload reduction and instead develop new principles that address the reality of the continuing poverty disclosed by research conducted in New York City over the past five years.  The new administration should establish a system designed to (1) address the barriers to financial independence faced by those who remain in need of support; (2) provide access to reasonable financial support for those who are currently unable to provide adequately for themselves; and  (3) ensure the timely, respectful, and proper administration of benefit delivery by the Human Resources Administration and by private entities under contract to the agency.

August  2001


Committee on Social Welfare Law



Cathleen Clements, Chair*
Ronald Israel, Secretary
Robert F. Bacigalupi*
Amy I. Berman
Valerie J. Bogart
Catherine F. Bowman
Kissa Broadie
Constance P. Carden
Timothy J. Casey*
Paul M. Dodyk*
Lorraine R. Doran
Hon. Saralee Evans**
Donald J. Friedman*
Arlene K. Gilbert
Hon. Emily Jane Goodman**
Glenn E. Harris
Elizabeth A. Hay
Ilizabeth G. Hempstead
Risa E. Kaufman
Hih Song Kim
William G. Lienhard
Felix Lopez
Helen J. Lukievics
Sara L. Mandelbaum
Israella F. Mayeri
Carolyn McQuade
Francis Mendez
Emily Ruben
Marie-Elena Ruffo
Hon. Laura Safer-Espinoza**
Rebecca Scharf
Matthew D. Schneider
William Tatlock
Juhu Thukral
Charlene Visconti


* Contributed to the authorship of the report

** Justices Evans, Goodman, and Safer-Espinoza took no part in the deliberations or vote on the report. 




[1] Throughout this report, the term "welfare reform" is used to denote legislation generated by the federal Personal Responsibility and Work Reconciliation Act and subsequent New York State legislation.  The Committee does not believe that true "reform" has taken place under the strict definition of the word: to make better by removing faults and defects (Webster's New Universal Unabridged Dictionary).

[2] HRA Facts, New York City Human Resources Administration (July 2000); "Lowest Welfare Levels Since 1966," New York Times (July 7, 2001).

[3] Hunger in New York State: An Analysis of Statewide and County-Level Trends in Government and Food Program Utilization, New York State Nutrition Consortium, 1999; Full Coffers, Empty Plates – Children Go Hungry in a City of Plenty, New York City Coalition Against Hunger (November 1999).

[4] Déjà vu: Family Homelessness in New York City, Institute for Children and Poverty (April 2001).

[5] A partial list includes: Reynolds v. Giuliani, Turner, Wing and DeBuono, 35 F. Supp.2d 331 (S.D.N.Y. 1999) (right to apply for cash assistance, food stamps and Medicaid); Morel v. Giuliani, 927 F. Supp. 622 (S.D.N.Y. 1995) (failure to provide benefits unchanged throughout fair hearing process); Piron v. Wing, Ind. No. 401310 (Sup. Ct. N.Y. County 1997 [Informal relief; no decision]) (failure to timely comply with favorable fair hearing decisions related to welfare); Mangracina v. Turner, 98 Civ. 5585 (JSR) (failure to continue Medicaid benefits when closing public assistance cases); Sanchez v. Turner, LEXIS 3439 (S.D.N.Y. 2001) (refusal to allow welfare advocates in welfare offices unless accompanied by client); Freeman v. Scoppetta, 98 Civ. 5636 (S.D.N.Y. 1999) (failure to timely respond to requests for special or additional welfare benefits for care of disabled foster children [stipulation; no decision]); Brown v. Giuliani, 158 F.R.D. 251 (E.D.N.Y.1994) (failure to timely respond to requests for special needs welfare grants); Matthews v. Barrios-Paoli, Ind. No. 404575/97 (Sup. Ct., N.Y. County 1997) (HRA demand that 19-year-old high school students drop out of high school to perform workfare); Hesthag v. Hammons Ind. No. 403426/96 (Sup. Ct., N.Y. County 1996) (failure to schedule workfare hours to allow a Home Relief recipient to complete the second half of a two-year associates degree nursing program); Capers v. Giuliani, Ind. No. 402894/97 (Sup. Ct., N.Y. County 1997) (refusal to modify dangerous and unhealthy conditions of workfare assignments); Davila v. Hammons, Ind. No. 407163/97 (Sup. Ct., N.Y. County 1997) (failure to assess employability of workfare participants).  See also "The Wages of Welfare Reform: A Report on New York City's Job Centers," The Record of the Association of the Bar of the City of New York (July/August 1999).

[6] In addition to original research, the Committee used as a resource Downside: The Human Consequences of the Giuliani Administration's Welfare Caseload Cuts, Timothy Casey, Federation of Protestant Welfare Agencies (November 2000), a discussion of 34 studies conducted in New York City.

[7] New York State has not taken this option thus far, although the Giuliani administration and the governor have annually urged the legislature to do so.

[8] Workfare is defined as tasks to which welfare recipients are assigned, not for wages, but as a condition of receiving their public assistance grant.

[9] "Forty Percent in New York City Are Foreign-Born, Study Finds," New York Times (July 24, 2000) (results of household survey taken in 1999 by U.S. Census Bureau).

[10] "The Real Test of Welfare Reform Still Lies Ahead," New York Times (July 2001) (Editorial-Opinion piece by William Julius Wilson, Harvard Kennedy School of Government, Andrew J. Cherlin, Johns Hopkins University).

[11] Article XVII has been judicially construed to mandate that the state cannot deny aid to needy New Yorkers who comply with the eligibility requirements, but broad discretion is left to the legislature to determine the level of aid.  Indeed, the level of the welfare grant has been unchanged since 1990.  Thus, the $577-benefit-level for a family of three in New York City is now less than half the federal poverty level.  

[12] See Report on the Governor's Proposed 1996-1997 Budget: Its Effect on Our State's Most Vulnerable Populations, The Association of the Bar of the City of New York (November 1996).

[13] Exemptions to the two-year limit on cash may be applied for based on a disability finding unless alcohol or substance abuse is indicated.

[14] "State Rethinks Deal to Provide Extended Welfare via A.T.M.," New York Times (July 14, 2001).

[15] Id.

[16] Snapshots of America's Families, The Urban Institute (January 1999), based on over 44,000 interviews, found fifty-four percent of low-income children suffering food shortages; young child poverty rates increased by twenty percent since 1979, with a disproportionate share in the three most populous states: California, Texas and New York; forty-two percent of all American children under age six living in poverty, i.e., below the federal poverty line of $12,802 for a family of three.

[17] R. Giuliani, “We are going to end welfare by the end of this century completely.” Reaching Out to All New Yorkers by Restoring Work to the Center of City Life, Republic National Bank (July 20, 1998).

[18]Welfare Reform Revisited: Implementation in New York City, New York City Independent Budget Office (September 1998); Welfare Reform in New York: A Report on Implementation Issues in New York City, Task Force for Sensible Welfare Reform, The New School's Milano Graduate School (January 1999).

[19] Opportunities for Change: Lessons Learned from Families Who Leave Welfare, Citizens Committee for Children (January 2000).

[20] The Human Resources Administration is the local social services agency responsible for administering New York=s cash assistance, food stamp, and Medicaid programs.

[21] Reynolds v. Giuliani, supra.

[22] Id., Order and Decision (January 25, 1999).

[23] "The Wages of Welfare Reform: A Report on New York City's Job Centers," Committee on Social Welfare Law, The Record of the Association of the Bar of the City of New York (July/August 1999).

[24] Hunger Is No Accident: New York and Federal Policies Violate the Human Right to Food, New York City Welfare Reform and Human Rights Documentation Project (July 2000).

[25] Commissioner Jason Turner, Address at the Nelson A. Rockefeller Institute of Government (November 1998).

[26]Testimony before the General Welfare Committee, New York City Council (April 30, 2001).

[27] Hunger Is No Accident, supra.

[28] Id.

[29] See Testimony, General Welfare Committee, supra.  This phenomenon is perhaps most noteworthy with regard to the arrival in December 2001 of the five-year time limit for those recipients who have been receiving Family Assistance since the adoption of the PRA in 1996.  Approximately 46,000 New York City families will face federal welfare cutoffs.  "As Welfare Deadline Looms, Answers Don't Seem so Easy," New York Times (June 25, 2001); "Lowest Welfare Levels Since 1966," New York Times (July 7, 2001).

[30] Id.

[31] Id.

[32] Nowhere to Turn: New York City’s Failure to Inform Parents on Public Assistance About Their Child Care Rights,W Legal Defense and Education Fund (2000); see also A Status Report of Selected Aspects of the Implementation of Welfare Reform in New York City, State of New York Office of the State Comptroller, Report 99-N-4 (August 21, 2000).

[33] Id.

[34] Still Nowhere to Turn: New York City's Continuing Failure to Inform Parents About Their Childcare Rights, NOW Legal Defense and Education Fund (2001).

[35] See, e.g., a federal lawsuit charging the Giuliani administration with failing to protect women in workfare jobs from sexual and racial harassment by their supervisors, infra.

[36] "Case Study: The Depressed Poor," New York Times Magazine (May 6, 2001).

[37] "The New Face of Homelessness is Youthful: Only the Great Depression Saw More Children Wandering America's Mean Streets," San Francisco Chronicle (July 1, 1999).

[38] Hernandez v. Barrios-Paolis, 93 N.Y.2d 781, 698 N.Y.S. 2d 590, 720 N.E.2d 866 (1999).

[39] Id.

[40] Henrietta D. v. Giuliani, 119 F. Supp.2d 181  (E.D.N.Y. 1996).

[41] Id.

[42] Id.

[43] Id.

[44] Hanna v. Turner, Ind. No. 111105/98 (Sup. Ct. N.Y. County 1999).

[45] Id.

[46] "City Fined on AIDS Housing," New York Daily News (June 21, 2001).

[47] Dangerous Indifference: New York City's Failure to Implement the Family Violence Option, NOW Legal Defense and Education Fund, Legal Aid Society, Women, Welfare and Abuse Task Force, Urban Justice Center (2000).

[48] Id.

[49] Studies have suggested a rate of domestic violence as high as sixty-five percent among women applying for public assistance.  Domestic Violence: Prevalence and Implications for Employment Among Welfare Recipients, U.S. General Accounting Office Report to Congressional Committees (November 1998).

[50] "The New Face of Homelessness is Youthful," San Francisco Chronicle (July 1, 1999).

[51] "Misuse of Drug Treatment Records,"  New York Times Editorial (October 1999).

[52] Letter to Frank Lipton, Deputy Commissioner, HRA, from Kathleen Riddle, President, John Coppola, Executive Director, New York State Association of Alcoholism & Substance Abuse Providers (October 19, 1999).

[53] Letter from Frank Lipton, Deputy Commissioner, HRA, to Kathleen Riddle, President, John Coppola, Executive Director, New York State Association of Alcoholism & Substance Abuse Providers (November 19, 1999).

[54]  Social Services Law §132(4)(c).

[55] Decision in Docket Number 02-99-3130, U.S. Department of Health and Human Services, Office of the Secretary, Office for Civil Rights, Region II (October 21 1999).

[56] Id.

[57] System Failure: Mayor Giuliani’s Welfare System is Hostile to Poor and Immigrant New Yorkers, Make the Road by Walking (April 1999).

[58]Eating Welfare, CAAV: Organizing Asian Communities/Southeast Asian Youth Leadership Project (July 2000).

[59] Id.

[60] Id.

[61]Decision in Docket Number 02-99-3130, U.S. Department of Health and Human Services, supra.

[62] New York State Department of Social Services Bureau of Fair Hearings, Agency Workload Comparison, April 20, 1999.

[63] Id.

[64] Fridman v. The City of New York, HS Systems, Inc., Marva Livingston Hammons and Aurelio Salon, Jr., M.D., 96 Civ. 6099  (S.D.N.Y.) (personal injury lawsuit following heart attack and subsequent lifetime disability for failure to exempt plaintiff from strenuous workfare assignment despite documentation of preexisting cardiac condition).

[65] Omnibus Consolidation Rescissions and Appropriations Act (OCRAA) of 1996, Public Law No. 104-134, Sec. 504, reenacted in OCRAA of 1997, Public Law No. 104-298, Sec. 502 (which reduced and restricted funding to the Legal Services Corporation).

[66] New York Law Journal (February 10, 1998), quoting Matter of Lewis v. Barrios-Paoli, Index No. 400695/97 (Sup. Ct. N.Y. County).

[67] Memorandum DSS-524EL, State of New York, Department of Social Services, December 11, 1996.

[68] Matter of Lewis v. Barrios-Paoli, supra.

[69] Id.

[70] New York Law Journal (May 14, 1999), quoting Martinez v. Turner, Index No. 401732/98 (Sup. Ct. N.Y. County 1998).

[71] Id.

[72] Id.

[73] New York Law Journal (April 15, 1999), quoting In Re Eli Raitport v. New York City Department of Social Services, Index No. 400145/98 (App. Div. 1st Dept.).

[74] Matter of Nembhard v. Turner, Index No. 403024/99 (Sup. Ct. N.Y. County).

[75] The Work Experience Program: New York City’s Public Sector Sweat Shop Economy, Community Voices Heard (2000).

[76]Id.

[77] HRA JOBSTAT (March 1999).

[78] "NYC Nixed Harassment Claims," "City Must Shield Workfare Force on Harassment: City Is Accused of Ignoring Harassment in Workfare Program," New York Times (October 1, 1999).

[79] "Federal Suit Accuses City of Not Acting on Harassment Complaints," New York Times (July 15, 2001).

[80] Id.

[81] After Welfare: A Study of Work and Benefit Use After Case Closing, The Nelson A. Rockefeller Institute of Government (July 1999); see also Local District and State Performance Measures, Tables TA 4a, TA 4b, New York State Office of Temporary and Disability Assistance (January 1998) and "Evidence Is Scant That Workfare Leads to Full-Time Jobs," New York Times (April 12, 1998).

[82] Leaving Welfare: Findings from a Survey of Former New York City Welfare Recipients,  New York City Human Resources Administration (September 1998).

[83] IdSee also Mangracina v. Turner, 98 Civ. 5585 (JSR) (failure to continue Medicaid benefits when closing public assistance cases).

[84] "Medicaid to be Restored for Thousands," New York Times (July 12, 2001).

[85] The Human Cost of Waiting for Childcare, The Children's Aid Society (December 1999).

[86] Welfare and Child Care: What About the Children? Report by the Public Advocate for New York City (June 1997).

[87] "Details Emerge on a State Budget That Is Meant to Be Painful," New York Times (August 1, 2001).

[88] "Surprising Result in Welfare-to-Work Studies," New York Times (July 31, 2001).

[89] Id.

[90] Id.

[91] Id.

[92] Workfare: The Real Deal II,  Community Food Resource Center  (July 1997).

[93] "When a Day's Work Still Doesn't Count: Job Rules for Students on Welfare Continue to Cause Confusion," New York Times (June 13, 2001).

[94] WEP Work Experience Program: New York City’s Public Sector Sweat Shop Economy, Community Voices Heard (2000).

[95] Id.

[96] Id.

[97] Focus on Contracting, City Project Newsletter, Vol. 1, No. 1 (December, 2000).  In The City Project’s terminology, human services covers a broad range of activities, e.g., childcare, AIDS services, employment services, and homeless services.

[98] For a discussion of privatization issues, see, e.g., “Managing the Contracting Process for Results in Welfare Reform,” Welfare Information Network Issue Notes (November 1998).

[99] “A Setback for City Hall Over Welfare,” New York Times (February 3, 2000).

[100] "Rejecting Favoritism Claim, Court Upholds a City Welfare Contract," New York Times (November 25, 2000).  The article noted that although the City was now free to finalize these contracts, criminal investigations of the contract procedures continued.  Sanctions were later issued against Commissioner Turner and First Deputy Commissioner Mark Hoover for other conflict-of-interest violations.  "Questions Mounting for Turner," New York Newsday (October 18, 2000); "$8,500 Ethics Fine for HRA's No. 2," New York Newsday (October 26, 2000); "City Fines Welfare Aide 8.5G in Ethics Case," New York Daily News, October 26, 2000).

[101] “Managing the Contracting Process for Results in Welfare Reform,” Welfare Information Network Issue Notes, supra.

[102] HRA Facts (February 1996, March 2000); Hunger Is No Accident: New York and Federal Policies Violate the Human Right to Food, New York City Welfare Reform and Human Rights Documentation Project (July 2000), citing Poverty in New York City, CSS Data Brief, Community Service Society (October 1999).

[103] Id.

[104] Id.

[105] New York [Food Stamp] Program Access Review: November-December 1998. U.S. Department of Agriculture, Food and Nutrition Service, Northeast Region (February 5, 1999).  See also Who Feeds the Hungry? Food For Survival, The New York City Food Bank, Hunts Point Co-op Market (2000); Hungry City: Are We Doing Enough to Feed the Needy? Councilmember A. Gifford Miller, (May 1999); Living on the Edge, Hunger Action Network of New York State (November 1998).

[106] Full  Coffers, Empty Plates, New York City Coalition Against Hunger (2000); Rationing Charity: New York City Struggles to Keep Up with Rising Hunger, New York City Coalition Against Hunger (October 1998).

[107] Hunger Is No Accident: New York and Federal Policies Violate the  Human Right to Food, New York City Welfare Reform and Human Rights Documentation Project (July 2000); see also Reynolds v. Giuliani, supra.

[108] "Use of Shelters by Families Sets Record in New York," New York Times (August 1, 2001).

[109] Id.

[110] "Shelter Population Reaches Highest Level Since 1980's," New York Times (February 7, 2001).

[111] Id.

[112] Id.

[113]Déjà Vu: Family Homelessness in New York City, Institute for Children and Poverty (April 2001).

[114] Id.

[115] Callahan v. Giuliani, Index No. 41494/82, (Sup. Ct., N.Y. County 2000).

[116] Id.

[117] Although previous administrations provided application centers throughout the city, the Giuliani administration requires all applicants to travel to a single center in the South Bronx in order to apply for entry to a homeless shelter.

[118] See McCain v. Giuliani, 252 A.D.2d 461, 676 N.Y.S.2d 215 (1st Dep't 1998).

[119]Homeless Families: Out of Sight, Out of Mind.  How New York City Created a Hidden Human Crisis at the Emergency Assistance Unit in 1998, The Action Research Project on Hunger, Homelessness, and Family Health (June 1999)..

[120] A prerequisite for remedying the underlying bases for denial.  Charles Dickens Meets Franz Kafka: How The Giuliani Administration Flouted Court Orders And Abused Homeless Families And Children, The Action Research Project on Hunger, Homelessness, and Family Health (November 1997).

[121] "City Offers New Plan on Homeless in a Bid to Avoid a Contempt Order," New York Times (April 24, 2001).

[122] Id.

[123] The proposals noted here each seek to enhance the capacity of the household to pay for existing housing.  Clearly, a long-term approach to the affordable housing crisis must involve a significant expansion of the city’s housing stock through rehabilitation and new construction.

[124] President Clinton’s proposals, in turn, derived largely from Poor Support: Poverty in the American Family, David Ellwood (Basic Books, 1988).  A Harvard professor who joined Clinton administration, Dr. Elwood resigned in protest shortly after the president signed the Personal Responsibility and Work Opportunity Act of 1996.

[125]Making Ends Meet: How Single Mothers Survive Welfare and Low-Wage Work, Russell Sage Foundation (1997).

[126] See, e.g.,Economic Policy Institute's study, released July 24, 2001, reporting that 80 million Americans have incomes that will not cover their minimal needs, or nearly 30 percent of the US population.  The Washington-based research group found that the minimum budget for a typical family of three could be as much as $46,000 a year, depending on location.  See also The Self-Sufficiency Standard for the City of New York, Women's Center for Education and Career Advancement (September 2000).

[127] "Tales of Hardship From Tenants and Owners," New York Times (June 14, 2001).