Welfare benefits to be cut Aug. 1

HELENA (AP) - As they predicted even before the 2003 Legislature ended, state welfare officials announced Monday they will reduce benefits to 17,000 people in Montana beginning Aug. 1. The reduction affects those relying on a program that provides cash assistance to the poor. The payment rate will drop from 40.5 percent of the federal poverty level to 30 percent.

For a three-person household, the change will mean a reduction in benefits from $507 per month to $375. Because individual income will decrease, an increase in food stamps may result.

The cut is a result of lawmakers' slicing about $2 million from the cash assistance program in April, at a time when the number of people seeking state help is projected to go up.

Lawmakers have defended the move, saying they needed to put some of the money into a program that pays child care expenses for single parents trying to get jobs. But critics argued the reduced cash payments will force more people to seek child care aid as they try to find jobs.

A public hearing on the proposed change is planned for Friday in Helena at the auditorium of the Department of Public Health and Human Services. A series of eight meeting in other cities will be conducted later this month and in July.

''We obviously will be listening and taking down information at the hearing, but to be completely honest, right now we don't see any alternative'' but to reduce the payments on Aug. 1, said Hank Hudson, administrator of the DPHHS Human and Community Services Division.

The department was provided $31.6 million for the cash benefits in each of the next two years. But if the benefits remain the same and cases grow by the expected 9 percent, the program would be short $9.1 million the first year and $13.2 million the second year.

Hudson said the department considered and rejected some other options, including a smaller reduction or simply halting all payments when the program runs out of money.

''There is no easy way to keep the program going without hurting clients, but we think this is the most equitable method overall,'' Hudson said.