Two-Tier Welfare Payments Rejected : Law: Supreme Court lets stand a ruling that Minnesota could not limit benefits to new residents. The action is a setback to similar California statute.

By DAVID G. SAVAGE

Jan. 19, 1994 12 AM PT

TIMES STAFF WRITER

WASHINGTON — In a setback for California’s campaign to limit welfare costs, the Supreme Court on Tuesday let stand a ruling that forbids states to pay lower welfare benefits to new residents.

The justices rejected appeals filed by Minnesota Atty. Gen. Hubert H. Humphrey III and California Atty. Gen. Dan Lungren, both of whom argued that fiscally strapped states should be permitted to employ a “two-tier system” for distributing state benefits.

The high court action appears to block efforts by lawmakers in California, New York and Illinois to restrict the levels of state aid given to new legal residents.

Pressing for this change in 1992, Gov. Pete Wilson decried the “welfare magnet” that draws poor people from other states to take advantage of California’s relatively generous benefits.

“We’re extremely disappointed,” said Amy Albright, a spokeswoman for the California Department of Social Services. “We had hoped the Supreme Court would reconsider this issue.”

Two years ago, the state Legislature reduced welfare benefits for newcomers to California, but that measure has been blocked by a federal judge.

The recent laws have run afoul of a series of Supreme Court decisions between 1969 and 1981. Those rulings said that a state may not discriminate among its legal residents based on the length of time they have lived there. To do so, the court said, would violate the fundamental “right to travel” that is enjoyed by all Americans.

Based on that rationale, the Minnesota Supreme Court in August struck down that state’s new law, which limited welfare benefits for new adult residents to 60% of the state maximum for six months. No one would have suffered a true loss of benefits by moving to Minnesota, however, since the state pledged to match the benefits paid by another state.

Nonetheless, the Minnesota high court invalidated the law on the grounds that the Constitution “mandates that the state distribute benefits equally to its needy residents . . . without distinguishing between (them) on the duration of their residency.”

Last January, U.S. District Judge David Levi of Sacramento blocked enforcement of the California statute on the same grounds. That law, enacted in 1992, would have limited the welfare benefits paid to new Californians for 12 months. During this period, the newcomers could not receive benefits that were higher than the benefits paid in their previous state.

In California, a needy mother with two children receives $607 a month, Albright said. By contrast, Texas would pay $221 a month to the same mother, Florida $364 per month, she said.

If enforced, the 1992 measure would have saved California an estimated $22.5 million during this fiscal year.

But Levi invalidated the provision on the grounds that the Constitution “does not permit significant distinctions between new and old residents based on the duration of their residency.”

In his appeal of the Minnesota decision, Humphrey, the son of former Vice President Hubert H. Humphrey, urged the high court to reconsider its precedents and to rule that the Constitution does not demand “an absolute ban on durational residency requirements” in state law.

Without comment or dissent, the justices rejected the appeal in the case of Steffen vs. Mitchell, 93-720.

Lungren also filed a separate brief urging the high court to “recognize that the severe fiscal crisis (in California) is sufficient justification for the implementation of a two-tier system for the provision of public benefits.”

California state attorneys have appealed Levi’s decision to the U.S. 9th Circuit Court of Appeals. But after Tuesday’s high court action, their chances for success are limited.

Meanwhile, the Supreme Court also let stand a ruling concluding that the California state government violated federal labor law when it delayed payments to state workers during the 1990 budget crisis. The paychecks were issued two weeks late.

Responding to a lawsuit filed by 1,800 state highway workers, a federal appeals court in San Francisco said that state and private employers are required by law to issue paychecks on the regular pay day.

In its unsuccessful appeal in Wilson vs. Biggs, 93-772, state lawyers argued that the state Constitution precludes making such payments until a budget is approved.