BILL ANALYSIS Ó AB 69 Page 1 Date of Hearing: April 5, 2011 ASSEMBLY COMMITTEE ON HUMAN SERVICES Jim Beall Jr., Chair AB 69 (Beall) - As Introduced: December 15, 2010 SUBJECT : Senior nutrition benefits SUMMARY : Seeks to identify, through the Social Security Administration (SSA) benefits database, needy seniors who may be eligible for CalFresh benefits in order to enroll them and improve their nutrition. Specifically, this bill : 1)Requires the Department of Social Services (DSS) to seek a federal waiver to establish a pilot project in two counties, and: a) Work with SSA to develop ways to target social security recipients eligible for CalFresh benefits; b) Develop a streamlined application process to enroll eligible seniors in CalFresh who are 65 years and older; c) Consider other states' experiences when implementing the pilot project that would reduce paperwork and increase nutritional benefits, including but not limited to, self-certification or key eligibility factors, standardization of benefits and deductions, and automation of the application process; and d) Consider other strategies to increase CalFresh participation among existing eligible seniors. EXISTING LAW : 1)Prohibits CalFresh eligibility for seniors who receive Supplemental Security Income/State Supplementary Payment (SSI/SSP), also known as "Cash-out." 2)Provides, under federal law, the Supplemental Nutrition Assistance Program (SNAP), known in California as CalFresh (formerly the Food Stamp Program), under which nutrition assistance benefits formerly referred to as food stamps are distributed to eligible households. AB 69 Page 2 FISCAL EFFECT : Unknown COMMENTS : According to the author, senior participation in the CalFresh program is disturbing low and this bill attempts to reach out to this vulnerable group and enroll them in CalFresh. Background Good nutrition is especially important for seniors. It can help improve resistance to illness and disease or help manage existing health problems. It can improve mental acuity and increase longevity. And for many seniors relying on prescription medications, nutrition is vital - as many medications are required to be taken with food. But many seniors are struggling. According to the Elder Economic Security Standard Index, about half a million seniors who live alone are not able to make ends meet. Many struggle to afford nutritious food. According to the California Health Interview Survey, nearly 20% of low-income seniors in California are "food insecure" or an inability to secure adequate food. While a number of programs exist to increase resources for food, one of the largest remains severely underutilized: only 10% of eligible seniors participate in CalFresh and only 5% of eligible Social Security recipients in California participate in CalFresh. Since the creation of the Food Stamp Program, very few seniors have participated. In the 1970's, "cashout" was established and seniors on SSI in California have been barred from participating since then. This has meant a large segment of the senior population has been ineligible for quite some time, while actually eligible senior populations have gotten confused over their eligibility (especially those receiving other benefits from the Social Security Administration). Since 1997, the federal government has required the Social Security Administration to give SSI applicants the opportunity to file a food stamp application. This requirement and a general interest in increasing enrollment among seniors have led many states to develop and test the now proven successful strategies that have increased enrollment among SSI recipients. However, no such efforts have occurred to enroll recipients of Social Security. AB 69 Page 3 Why senior participation is so low CalFresh participation is low across all populations, but there are clearly some unique barriers to participation among seniors such as transportation, a confusing application process, and the perceived stigma of receiving "charity." Despite some special rules for seniors the application process is still challenging for many. Other states have taken steps to make it easier for some seniors to participate. For example, many states operate Combined Application Projects (CAPs) to enroll elderly SSI recipients into SNAP (the federal name for CalFresh). Though SSI recipients in California are ineligible for CalFresh, the approaches used in other states may prove successful if applied to other California senior populations that are indeed eligible. Given that the Social Security Administration was the primary partner in the CAP projects in other states, the hope is that they could be enlisted in an effort to test strategies for enrolling Social Security recipients in California into CalFresh. This bill seeks to design and implement a pilot project that would use the existing information within the SSA database to identify eligible CalFresh seniors and enroll them in a very streamlined fashion. If successful, the projects in two counties could increase senior participation and obtain critical nutrition benefits for this vulnerable group. At the same time, the increase in participation would have the added plus of infusing much needed economic stimulus for grocery stores, farmers, and related businesses involved in the growing, selling, and distribution of food. Indeed, this effect is recognized with the support from the California Farm Bureau Federation, California Retailers Association, California Grocers Association, and the California Restaurant Association. AB 69 Page 4 Positive fiscal effect of food stamp benefits According to Moody's Investor Services, an independent provider of credit ratings and financial services research, CalFresh benefits have the highest economic multiplier effect out of all government programs or fiscal policy tools that stimulate the economy. Moody's finds that for every CalFresh dollar spent, $1.74 is generated in economic activity. (The USDA finds this amount to be $1.84). Additionally, these benefits generate sales tax revenue for county and the state coffers. To the extent that this bill increases CalFresh participation, the state could expect to receive additional state General Fund revenue due to increased taxable purchases by recipients. This is possible because studies show that low-income families such as CalFresh recipients spend approximately 45% of their income on taxable goods. By providing these families with CalFresh benefits, 45% of the money previously used by the family to purchase food would now be used for purchasing taxable goods. REGISTERED SUPPORT / OPPOSITION : Support AARP Alameda County Community Food Bank California Association of Food Banks California Catholic Conference, Inc. California Commission on Aging California Communities United Institute California Farm Bureau Federation (Farm Bureau) California Grocers Association (CGA) California Hunger Action Coalition California Restaurant Association California Retailers Association California School Employees Association, AFL-CIO California Senior Legislature (CSL) Catholic Charities of California (co-sponsor) Catholic Charities of California United Community Action Partnership of Orange County FOOD Share, Inc. Hunger Action, Los Angeles JERICHO Second Harvest Food Bank, Santa Cruz County Senior Services Coalition, Alameda Co. AB 69 Page 5 St. Anthony's Opposition None on file. Analysis Prepared by : Frances Chacon / HUM. S. / (916) 319-2089