Panel questions whether $77M in federal aid was ‘left on the table’

After months of complaints by Gov. M. Jodi Rell that they were not doing their jobs, the state lawmakers studying ways to streamline the budget are tossing a challenge back at the outgoing administration: Did it fail to secure nearly $77 million in federal welfare aid?

The Commission on Enhancing Agency Outcomes is asking officials of the Department of Social Services to check their records in light of commission researchers’ findings that the state may not have sought all the money available to it.

But a spokesman for DSS said Tuesday that while the agency would work with lawmakers, officials there don’t believe they failed to seek any available funding.

The legislative commission first raised questions late last month about $5 billion in federal stimulus aid allocated for Temporary Aid to Needy Families, a federal welfare program that largely serves single women with children.

Researchers from the Program Review and Investigations Committee assigned to the efficiency panel estimated as much as $133 million of this $5 billion had been reserved for Connecticut. The key to securing all of that money would whether state officials could demonstrate sufficient expenditures due to increasing welfare caseloads, employment subsidies or other types of aid such as rental and food assistance and support services for domestic violence victims.

Legislative researchers found it difficult to determine exactly how much funding the Rell administration sought, but noted that it was well short of $133 million. According to researchers, state records show Connecticut applied for $56.3 million, while federal records show a request for $38 million.

“It also appears that Connecticut interpreted eligibility, expenses and reporting requirements too narrowly,” researchers wrote. For example, state assistance to one of Connecticut’s largest food banks was not factored into the application for federal aid because of difficulties in accounting for increased spending. But the federal program’s guidelines show that exceptions in estimating expenditures are allowed, and three neighboring states – New York, New Jersey and Massachusetts – all took advantage of them, researchers wrote.

The commission’s co-chairmen, Sen. Gayle Slossberg, D-Milford, and Rep. James Spallone, D-Essex, wrote to Social Services Commission Michael P. Starkowski on Nov. 24, asking that his office seek an official interpretation from the U.S. Department of Health and Human Services about the state’s potential eligibility for added funds.

“Given the amount of federal revenue ‘left on the table,'” the co-chairmen wrote, “if the state is allowed to amend its application, the department should take immediate action.”

The commission, which is tasked with identifying at least $50 million in budget savings by Dec. 31, tentatively has scheduled a final meeting for Dec. 15.

State Department of Social Services spokesman David Dearborn said Tuesday that a response is being prepared for the panel and that agency officials would work to answer all questions. Details on the precise amount of funding sought by the department were not available late Tuesday.

But Dearborn also said that “I don’t have any indications that there’s anything further the state could have done on this.”

The administration’s application reflected additional expenses tied to employment subsidies and other support services, but Connecticut’s welfare caseload in the TANF program has remained relatively level between 18,000 and 19,000 households in recent years, he said.

“I’m looking forward to their response,” Spallone said Tuesday evening, declining further comment until he could review specific details about the department’s federal aid application.

The relationship between the legislative panel and the Rell administration has been frosty since shortly after the fiscal year began on July 1. The governor accused the group several times this past summer and fall of not meeting its charge to find $50 million in savings, arguing a specific plan should have been adopted and submitted to the full legislature before the current fiscal year began.

The commission tentatively endorsed more than $250 million in new cost-cutting measures last week, targeting state health care services for the poor and elderly, contract awards, energy costs, agency consolidations and tax enforcement. The proposals would save an estimated to save $153 million this fiscal year, and an additional $101.7 million starting in 2011-12.

All recommendations by the group are expected to be reviewed by the General Assembly during the 2011 session, which begins Jan. 5.