Effects Of Furloughs In California

From a report of the California State Senate Rules Committee:

Disability Programs. We found that by taking workers off the job as many as three days a month, furloughs have delayed tens of millions of dollars in monthly checks for people with long-term disabilities. Among our specific findings about the federal Social Security Administration disability programs:
• Federal disability benefits of $68 million to $99 million a year will be delayed for thousands of qualified Californians because furloughs have slowed the processing of applications.
• Each furlough day delays the processing of an estimated 1,476 applications for federal disability benefits, with a corresponding delay of $420,800 in benefits for blind, needy or disabled people.
• The backlog of applications for Social Security disability benefits in California is growing.
• An estimated 27,000 hours of labor per month are lost to furloughs in the programs that determine which Californians qualify for disability benefits.
• The average amount of time off taken by the state workers who determine eligibility for federal disability benefits increased by 47% between the third quarter of 2008 – before furloughs – and the same quarter in 2009.
• Furlough of the people who determine eligibility will cost the state between $18 million and $31 million a year in salaries and other administrative costs that would have otherwise been paid by the federal government – with a corresponding loss of at least $1.4 million in state income taxes.
• Federal officials have gone to court to argue that California’s furloughs hinder delivery of benefits that can prevent homelessness for vulnerable Californians.
• They have also warned California officials that federal regulations require states to avoid labor restrictions that impinge prompt payment of benefits.

California is furloughing disability determination employees even though their salaries are paid for by federal funds. Furloughing these employees saves the state government no money. In fact these furloughs worsen the state's budget situation since it reduces the taxes paid by those state employees. More importantly, the recipients of Social Security disability benefits do pay sales taxes and the money they spend provides for employment for others who do pay income taxes. There is no rational explanation for what California and several other states are doing.