Maryland is considering restoring welfare benefits to about 4,700 persons cut from the Aid to Families with Dependent Children program by, in effect, circumventing the tighter restrictions imposed by the Reagan administration.
Under a proposal by state welfare officials, the so-called "standard of need," the minimum subsistence level that determines eligibility for AFDC benefits, would be increased, restoring benefits to at least some of the 34,500 persons eliminated from welfare roles in Maryland on Oct. 1.
To beleaguered state officials, changing the standard of need represents a potentially valuable tactic in coping with the effects of the Reagan cutbacks, and officials in several other states and the District of Columbia are thinking about joining Maryland in doing it.
"Changing the standard is probably the most significant action a state can do to counter the Reagan budget," said Dave Racine, director of government affairs for the American Public Welfare Association.
The U.S. Office of Management and Budget, which expects to save more than $1 billion dollars in fiscal year 1982 from welfare reductions, discounted the effect of the state's proposals at this stage but acknowledged that wide adoption of the changes could be costly.
"I don't have a sense there's a widespread defection in the large case-load states," said Allen Meyers, a welfare specialist within OMB. "It's very hard to say this is a trend that's confounding the numbers. The fact Maryland hasn't done it raised the standard in years may mean they were ready for it, anyway."
Maryland's officials plan to raise the state's standard of need, the amount of money each state sets for miniumum subsistence in the state.
Under the Reagan administration's tighter welfare rules that went into effect Oct. 1, no one earning more than 150 percent of a state's standard of need is eligible for welfare.
In Maryland, for example, this one provision dropped about 4,700 of the so-called working poor, people who formerly had been allowed to deduct up to $160 monthly in child care and $75 for transportation expenses from their monthly income. Under the Reagan rules, these deductions are not allowed and so their incomes exceeded the maximum.
Other provisions of the new, stricter welfare rules dropped another 29,800 people from the state's AFDC rolls, and the proposal to raise Maryland's standard of need does not affect them.
The standard currently stands at $326 and is the amount that the state believes is necessary for a family of four to exist for one month.
By raising Maryland's standard to $400 or $450 a month, state officials say welfare benefits -- and in many cases Medicaid benefits -- would be restored for about 4,700 of the working poor, whose incomes put them just above the new eligibility levels. For most AFDC families, losing welfare eligibility means losing government-paid medical benefits, too.
"I don't believe President Reagan and Mr. Stockman understood they were doing something that stupid, counterproductive and harmful for the working poor," said Kalman Hettleman, secretary of the Maryland Department of Human Resources, whose office briefed Gov. Harry Hughes on the proposal last week.
Although the tactic would cost Maryland between $2 million and $3.6 million, depending on which level the governor chooses, the money would come from the $6 million in expected savings from the Reagan welfare cuts, money that already had been budgeted, said Hettleman's aide, Mark Friedman.
According to Kettleman, the standard could be raised through emergency rules and be effective by February. "I'm very comfortable and confident the governor will respond in a fair way" on the proposal, he said.
In a letter to be released today to the legislative committee that would be responsible for changing the state's standard, Gov. Harry Hughes says he will decide on the proposal within the next three weeks.
Cheryl Lynch, a lobbyist for Catholic Charities in Maryland, who has urged the legislative committee to raise the standard, said the maneuver "is not a slap in the face to the Reagan administration.
"The Reagan administration has asked states to take a bigger role," she said. "This simply shows the states taking more responsiblity."
The vice-chairman of the General Assembly's Committee on Administrative, Executive and Legislative Review, which must approve changes in the state's welfare rules, said the committee needs more complete figures to know whether the state can restore federal cuts without financial harm. The states and the federal government share the costs for welfare evenly.
"We'll find the so-called state surplus being used up by the greater number of unemployed," predicted Del. Carter Hickman (D-Church Hill).