Clarence Ayers was baffled.
At 73, he was raising his great-granddaughter in rural Fresno County. He relied on $334 a month in public assistance to help cover the teenager's expenses: new shoes when she outgrew her old ones, transportation to the after-school activities she enjoyed.
But last summer, county officials said they were slicing his CalWorks payment by 10% and for the most perplexing of reasons: Over the years, they had mistakenly sent $10,000 to the girl's mother and grandfather.
"Irene wasn't even born when some of that money was paid," Ayers said. "She was being punished for something she never did."
For decades, if county officials couldn't track down a parent or guardian who owed them money, they went after the children — even if they no longer lived together.
Now, the much-criticized practice is ending as part of an agreement to settle a lawsuit filed by Ayers and others who accused state officials of essentially holding children responsible for their caregivers' debts.
Details and total costs of the settlement are still being hammered out, but the California Department of Social Services said refunds will be provided for any such collections made since Jan. 6. Earlier this year, counties were told to stop collecting on past overpayments from adults whose families benefited from the funds when they were children.
"We're very pleased that the department has recognized that this is something they want to change," said Patti Prunhuber, a Public Interest Law Project attorney involved in the case. "These debts do not belong to these children. They are not responsible for them. They didn't create them, and they shouldn't follow them into their new households or into adulthood."
Officials now will focus on recovering overpayments from the parents or caregivers who received the funds, said department spokesman Michael Weston.
A program administered at the county level, CalWorks provides cash assistance to some of the state's neediest families. The program has been pummeled by budget cuts in recent years, whittling down how much families can qualify for and how long they can receive the aid.
If county officials overpay a family by $35 or more, state law requires them to try to recover it, according to court filings. One option is to track down other household members. In some cases, officials allegedly garnished the benefits or tax refunds of young people whose caregivers had been paid too much because of a county mistake, legal aid attorneys said.
Another plaintiff in the lawsuit, Jamie Hartley, was just 16 in 2008 when Riverside County paid her mother for her older brother's expenses, even though he no longer qualified for the program. County officials threatened to seize Hartley's 2011 tax refund to help collect the $766 debt — money she was counting on to help cover college living expenses, according to court papers.
It's not clear how many people were targets of such practices, which date back at least to 1981, Weston said. Until 1996, federal law required that officials recover overpayments from any member of the household possible, he said.
Now states can decide whether to pursue those who were minors when the money was provided. In Los Angeles County alone, 4,682 children and 88 adults were having money docked from their benefits to recoup such overpayments at the time the practice was stopped, officials said. The county stopped going after tax refunds in 2000.
In the last two years, legal aid attorneys received a rash of complaints from people who had received collection notices, said Antionette Dozier, an attorney for the Western Center on Law and Poverty who also worked on the case. It appeared that changes in systems used to recover overpayments had turned up a number of old cases, Dozier said.
In 2010, Pilar Lopez received a letter from Butte County officials saying she owed nearly $7,000. If she didn't erase the debt, officials said they would seize her tax refund, a huge financial blow to the mother of three who was paying her way through Chico State.
The CalWorks money had actually gone to Lopez's father during a period in the 1990s when she'd lived mainly with other relatives in a different county. After she tracked down school and medical records that backed up her account — a process that took months — Butte County officials relented.
"Why are you going after a minor when they didn't even know what money meant back then?" said Lopez, 32. "I literally could not sleep at night. I kept thinking, 'Where am I going to get the money?'"
The settlement came as a relief to Ayers, the 73-year-old raising his 14-year-old great-granddaughter, Irene. He said details of how the state debt was incurred were never fully explained. Irene's mother was a child herself when at least some of the payments were made, Ayers said, and her grandfather is no longer alive.
Retired after working in transportation on movie sets, he said he lives on Social Security income, his savings wiped out by a series of family funerals.
The CalWorks grant he receives to support Irene is a "big help," he said. "She's growing so fast." Every week, she asks for money for a new pair of shoes, a school trip or a science project. "She's active at school. I don't want to stop that."