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In a hearing that included testimony from children as young as 6 years old, an Assembly budget panel on Wednesday rejected Gov. Jerry Brown's welfare-to-work cuts.

The Assembly's health and human services budget subcommittee voted 3-1 along party lines against cutting grant levels and eliminating adults after 24 months, instead of 48, if they cannot find work. Brown had counted on CalWORKs cuts to save $946 million to help close a deficit he estimates at $9.2 billion.

The state has reduced welfare benefits since the recession, such as shrinking the adult time limit from 60 months to 48 months and cutting maximum grants by 8 percent last year. Brown this year proposed restructuring CalWORKs to spend more on benefits for people who find work and less on those who cannot.

Welfare advocates testified Wednesday that Brown's plan would harm families because many recipients have tried and failed to find jobs in the current economy.

The panel instead agreed to find other ways to save and wait to see what the state's revenue picture looks like after tax dollars come in March and April. Though lawmakers likely won't take substantive floor action on the state budget until June, Wednesday's action marked the first significant legislative rejection of Brown's plan since he introduced it in January.

The only Brown items the panel agreed to Wednesday come with a higher immediate state cost rather than general fund savings. Democrats argue that the changes create more incentives for people to work and reduce dependence on the program in the long run. Lawmakers agreed to ignore $225 in monthly income - rather than $112 - when determining whether someone is eligible to receive welfare benefits, which would cost the state about $90 million.

They also agreed to provide a $50 monthly work bonus to non-CalWORKs families receiving food stamp benefits or state subsidized child care starting in July 2013. That change is largely intended to count more people toward meeting federal work requirements and avoid penalties, though it would cost the state $126 million annually in future years.



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