BILL ANALYSIS Senate Appropriations Committee Fiscal Summary Senator Tom Torlakson, Chairman 433 (Beall) Hearing Date: 8/30/07 Amended: 6/1/07 Consultant: John Miller Policy Vote: Human Svcs 3 - 2 _________________________________________________________________ ____ BILL SUMMARY: AB 433 requires the Department of Social Services to establish categorical eligibility for food stamps to qualified Medi-Cal recipients. _________________________________________________________________ ____ Fiscal Impact (in thousands) Major Provisions 2007-08 2008-09 2009-10 Fund Food benefits (costs) $ 0 $ 7,000 $ 7,000 GF $ 0 $10,000 $10,000 FF $ 0 $ 3,000 $ 3,000 Cty Mandate costs undetermined Food benefits (new) $ 0 $(200,000) $(200,000)FF School lunches (new) $ 0 $( 30,000) $( 30,000) FF Sales tax revenue (new)$ 0 $( 5,000) $( 5,000) FF _________________________________________________________________ ____ STAFF COMMENTS: SUSPENSE FILE AS PROPOSED TO BE AMENDED This measure seeks to increase access to healthier foods for low income individuals and to maximize federal benefits available to low income families. The bill requires the department to establish categorical eligibility for food stamp benefits for Medi-Cal recipients qualified as TANF beneficiaries and directs the department to convene a group to find a new name for the food stamp program. The state currently has developed categorical food stamp eligibility for individuals qualified for cash assistance. The bill further mandates counties to make reasonable efforts to identify eligible Medi-Cal beneficiaries who would be eligible and benefit from access to better food. Providing categorical eligibility to families receiving Medi-Cal could cost up to $20 million annually for administering additional cases. Of this amount one half would be paid by the federal government with the remaining $10 million split between the state (70%) and county governments (30%). Expansion of the food stamp program would generate nearly $200 million in federal food stamp benefits and would qualify children in these families for $30 million in free school meals which are primarily federally funded. In addition to the federal benefits, the state would realize roughly $5 million in sales tax revenue as provision of food stamps would allow poor families to spend more on taxable products. California has one of the lowest rates of food stamp participation in the nation. More than 2 million California families are eligible for food stamps but do not receive them. Amendments reduce state administrative costs and delay implementation by 6 months.