(b) It is the intent of the Legislature that the counties use the funds, when appropriated, to do all of the following:

1. (1) Improve the quality of jobs provided to recipients.
2. (2) Help individuals attain long-term self-sufficiency.
3. (3) Prevent the need for CalWORKs benefits for those families making the transition from the CalWORKs program.

(d) In order to provide counties with additional incentive to move CalWORKs recipients to employment, each county shall receive the state share of savings, including federal funds under the Temporary Assistance for Needy Families block grant subject to the amounts appropriated in the annual Budget Act, resulting from the following outcomes:

1. (1) Recipients exiting the program due to employment that has lasted a minimum of six months.
2. (2) Increased earnings by recipients due to employment.
3. (3) Diversion of applicants from the program pursuant to Section 11266.5 for six months in addition to the number of months equivalent to the diversion payment.

(e)

1. (1) For purposes of subdivision (d), the department, shall apply the method for valuing the outcomes to determine county share of savings that was utilized in fiscal years 1998–99 and 1999–2000, except that increased earning by recipients due to employment shall be valued at 50 percent of actual grant savings instead of 100 percent.
2. (2) The method shall be adjusted as appropriate, and determined in consultation with program stakeholders, to account for any changes made to the Temporary Assistance to Needy Families program requirements for block grant funding levels as a result of Congressional reauthorization of the program in 2002.

(g)

1. (1) Notwithstanding Section 11250 or any other provision of law, commencing October 1, 2000, exclusively for purposes of county performance incentives provided under this section and exclusively for purposes of providing nonassistance services pursuant to Section 42 U.S.C. Sec. 601(a)(1) and (2) to families not receiving aid under this chapter, “needy families” also includes any family in which the minor child is living with a parent or adult relative caregiver and the family’s income is less than 200 percent of the official federal poverty guidelines applicable to a family of the size involved.
2. (2) A county shall not expend more than 25 percent of its performance incentive funds for purposes of this subdivision.
3. (3) For purposes of this subdivision, “nonassistance services” means services that do not constitute assistance as defined in applicable federal law and regulations governing the Temporary Assistance for Needy Families program.