CDCAN Report #194-2010: No cost of living from federal government for Social Security, SSI benefits in January 2011

SACRAMENTO, CALIF (CDCAN) [Updated 10/15/2010  11:09 PM  (Pacific Time)]  -  For the second straight year there will be no automatic cost of living increase in January 2011 for the federally funded SSI (Supplemental Security Income) grants that is supplemented in California by the State Supplemental Payment (SSP) grants,  that go to hundreds of thousands of people with disabilities, the blind and low income seniors.  No automatic cost of living increases will be given to federal Social Security benefits to millions of seniors across the nation, also for the second straight year.

That means on January 1, 2011 – barring any last minute federal legislation after the November election the SSI/SSP grant levels in California will remain the same as it is as of October 15, 2010:

• Individuals - $845 (SSI portion - $674 and SSP portion - $171)
• Couples - $1,407 (SSI portion - $1,011 and SSP portion - $396)

Automatic yearly cost of living adjustments for the state portion (SSP) of the grant was eliminated as part of the 2009-2010 State Budget revised in July 2009, effective June 2011. 

2010-2011 State Budget “Trailer Bills” Now On Governor’s Desk

Meanwhile, in an update on the State Budget:  As of October 13th, all the budget related trailer bills, passed by the Assembly and State Senate on October 8th have finally reached the Governor’s desk.  It normally takes several days to prepare a bill that is passed into law into a final form – a process called “enrollment” that is the document the Governor either signs or vetoes. 

Those budget “trailer bills” include several key pieces of the budget agreement that was reached earlier this month by the Governor and four Democratic and Republican legislative leaders including:

• AB 1612 - the human services budget trailer bill that deals with changes and reductions to the In-Home Supportive Services program
• SB 853 – the health budget trailer bill that that deals with additional 1.25% cut to most regional center providers and regional center operations (which will take effect retroactively to July 1, 2010);  reauthorization of the nursing home quality assurance fee; and Medi-Cal; provisions dealing with closure and transition of residents and workers at Lanterman Developmental Center in Pomona;  (a separate bill deals with extending certain provisions of the Agnews Developmental Center housing transition process and plans for Lanterman)
• SB 208 and AB 342 -  two bills dealing with adding additional requirements to the Section 1115 Medicaid Waiver that has already been submitted to the federal government.
• The date when the Governor signs the budget trailer bills is crucial for several bills where certain new provisions – including a 3.6% reduction to authorized hours for all recipients of IHSS and imposing new disqualifying crimes for IHSS workers – begin to take effect 90 days from the date the bill is actually signed into law.
• The main budget trailer bills – dealing with health (SB 853), human services (AB 1619), transportation, education finance are certain to be signed.  Less certain are some bills that are not as critical to the overall budget agreement – such as the creation of a new “Secretary of Volunteerism and Service”.

As previously reported last week, the Governor already signed into law the main budget bill – SB 870, a few hours after the State Senate gave its approval, on October 8th, Friday (the Assembly approved it the night before on October 7th).  The Governor also signed on that day a budget related bill dealing with State finance to provide the State Controller with temporary authority to delay certain  payments in order to pay bills that have been unpaid due to the absence of a state budget, since July 1st.

The Governor – who returned from a six day trip for meetings with the Russian president in Moscow and later a short visit to the United Kingdom, with meetings with the British prime minister – will likely act on those budget related bills in the next several days.

CDCAN will report immediately when the Governor takes action on any of the budget trailer bills.

Since 1975 Federal Law Requires Automatic Cost of Living Increases For SSI

Since 1975 the federal government enacted a federal law that requires automatic cost of living increases to Social Security and related benefit programs including SSI, based on certain cost of living measurements.

JANUARY 2009 SSI FEDERAL COST OF LIVING ADJUSTMENT

• In 2008 the cost of living measurements during the reporting time period – the third quarter of that year (July-August-September) showed a spike in the rate of inflation that in turn resulted in a higher than expected cost of living adjustment (5.8%) that was applied to Social Security and SSI benefits in January 2009.
• That increase turned out to be highest cost of living adjustment increase to Social Security (and SSI)  in the previous 27 years. 
• However it turned out that the inflation rate in 2008 – after measuring the entire year – turned out to be much less – about one-tenth of 1% for the year – the lowest in 56 years. 

JANUARY 2010 SSI FEDERAL COST OF LIVING ADJUSTMENT

• In 2009 the federal cost of living measurements showed no cost of living increases – which meant no cost of living adjustments to Social Security or SSI  last January 1, 2010 – the first time that has happened since 1975. 

JANUARY 2011 SSI FEDERAL COST OF LIVING ADJUSTMENT  

• This year – in 2010, those same measurements also showed no cost of living increases in the third quarter (July-August –September)  – which means that there will be no cost of living adjustment for Social Security or SSI on January 1, 2011.

President and House Speaker Pelosi Have Talked About Special Increase For Social Security – But Outlook for Legislation in Lame Duck Session Seems Bleak

Both President Barack Obama and House Speaker Nancy Pelosi (Democrat – San Francisco) have talked about legislation that would provide for a special increase to Social Security – and presumably SSI when Congress comes back after the November elections for a “lame duck” session (meaning with members who will soon be retiring or with members who were voted out of office but who can still serve until January when their terms expire).

However it is not clear how Democrats in either house would be able to muster the needed votes to overcome what is likely to be strong Republican opposition – especially if Republicans win significant number of new seats or even take control in January of one or both houses of Congress.

No New Cuts to SSI/SSP Grants in 2010-2011 State Budget – But Permanent Elimination of the June State Cost Of Living Adjustment Will Take Effect June 1, 2011, Approved As Part of the 2009-2010 State Budget in July 2009

While the 2010-2011 State Budget contained no new reductions to the SSI/SSP program, there IS a reduction that will occur in the 2010-2011 State Budget year – the permanent elimination of the State cost of living adjustment, that would have been due to SSI/SSP recipients June 1, 2011.  That was passed as part of the 2009-2010 State Budget as revised in July.

• SSI/SSP Grant Levels: No additional new reductions to SSI/SSP grants to couples or individuals at least through June 30, 2011 (end of the State budget year).
• CAPI Program - No additional new reductions to the CAPI (Cash Assistance Program for Immigrants program), at least through June 30, 2011 (end of the State budget year) which is maximum $845 for individuals and $1,407 for couples. 
• SSI/SSP Federal cost of living due January 1, 2011:  the 2010-2011 State Budget requires any federal cost of living adjustment (COLA) for SSI to be “passed through” to the SSI/SSP recipients  – IF there is one.  As of October 15, 2010, the federal government announced there will be no cost of living adjustment to Social Security and to SSI benefits for January 2011.  That means the SSI/SSP grants will remain at the same level it is as of October 15, 2010, at least through next year.    
• SSI/SSP State cost of living (June 1, 2011) – effective this date, there will be no future automatic cost of living adjustments to the State portion (SSP) of the SSI/SSP grants unless the Legislature specifically grants it.  The elimination of the automatic cost of living adjustments also applied to CalWORKS grants and was passed by the Legislature and signed into the law by the Governor as part of the 2009-2010 State Budget as revised in July 2009.

Impact of People in California

SSI/SSP grant maximum grants levels will remain the same in January 2011 at level it is now (maximum individual grants of $845 and couples, $1,407), with no cost of living increase from the federal government.

Also hurting SSI/SSP recipients is the suspension of the June 2010 state cost of living adjustment for the SSP portion of the grant and the permanent elimination of all future State cost of living adjustments for the SSP portion of the grants (effective June 1, 2011) means the grant levels will remain the same.

With costs increasing in other areas – such as food, health insurance costs, medicines, transportation, housing – advocates have raised concerns – especially for low income seniors, people with disabilities and the blind on fixed incomes.

Background of SSI/SSP

Sometimes confused with Social Security benefits, SSI program does fall under the Social Security Administration – and some benefit requirements – such as the yearly automatic cost of living adjustments – are the same in both programs. 

• The California SSI/SSP program provides monthly cash grants for low income individuals (and couples) with disabilities, the blind and seniors.  As reported, the SSI portion of the grant is federal money – and the SSP portion is state funds to supplement the federal grant  - a program that some states, such as California, have opted to provided. 
• Under federal law, a federal cost–of–living adjustment (COLA) is made to the federal (SSI) portion of the grant every January – the amount of the adjustment or increase varies depending on the cost of living measurements the federal government uses.
• In California, the SSI/SSP program is overseen statewide by the Department of Social Services, including determining eligibility (for the federal government).   The State contracts with the US Social Security Administration to actually administer and pay the SSI/SSP benefit payments.
• Generally, to be eligible for the program, an applicant’s monthly income, with some exceptions for certain sources of income, must be at or below the amount of the SSI/SSP monthly grant (currently $845 for individuals). Additionally, an individual is usually ineligible for SSI/SSP if he or she has assets in excess of $2,000 (or $3,000 for couples), with certain exclusions, such as homes and vehicles.  To qualify for SSI/SSP on the basis of age, a person must be age 65 or older. To be eligible for the grant based on disability, an applicant must demonstrate that he or she is unable to work because of a permanent or long–term mental or physical impairment.
• CAPI – as previously reported, the State funded only Cash Assistance Program for Legal Immigrants provides a monthly cash grant to legal immigrants who have disabilities, are blind and/or are seniors, who meet SSI/SSP eligibility requirements, but who are not otherwise eligible due to their immigration status.