BILL ANALYSIS                                                                                                                                                                                                    Ó






                                  SENATE HUMAN
                               SERVICES COMMITTEE
                          Senator Leland Y. Yee, Chair


          BILL NO:       AB 191                                       
          A
          AUTHOR:        Bocanegra                                    
          B
          VERSION:       May 24, 2013
          HEARING DATE:  June 25, 2013                                
          1
          FISCAL:        Yes                                          
          9
                                                                      
          1
          CONSULTANT:    Mareva Brown                                
                                        

                                     SUBJECT
                                         
                                    CalFresh

                                     SUMMARY  

          This bill would raise the maximum gross income allowed for  
          CalFresh beneficiaries if an applicant is categorically  
          eligible for the program due to Medi-Cal eligiblity, as  
          specified. This bill additionally requires the state to  
          notify the legislature and to develop a plan to maintain  
          the Low-Income Home Energy Assistance Program (LIHEAP) if  
          program costs exceed allocated funding. It requires the  
          California Department of Social Services (DSS) to ensure  
          that receipt of LIHEAP benefits does not adversely affect  
          eligibility or benefit level under the CalFresh program. It  
          also entitles a homeless household to use the homeless  
          shelter deduction rather than the standard utility  
          allowance, if the benefit is greater.

                                     ABSTRACT  

           Existing law:
           
             1)   Establishes under federal law the Supplemental  
               Nutrition Assistance Program (SNAP) pursuant to the  

                                                         Continued---




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               Food Stamp Act of 1964 which provides federal funds to  
               states to assist needy households in maintaining  
               proper nutrition. (P.L. 88-525, 78 § 703-709)


             2)   Establishes in California statute the CalFresh  
               program to administer the provision of federal SNAP  
               benefits to families and individuals meeting specified  
               criteria. (WIC 18900 et seq.)


             3)   Establishes in federal regulations income  
               eligibility standards that define participants as  
               those whose incomes are determined to be a substantial  
               limiting factor in permitting them to obtain a more  
               nutritious diet, as specified. Permits some forms of  
               assistance to be excluded from the calculation of  
               income for the purposes of eligibility for SNAP and  
               others, such as a homeless deduction, to be  
               automatically calculated. (7 CFR 273.9)



             4)   Provides that any child who is eligible for federal  
               SNAP benefits is automatically certified to receive  
               free school meals without an additional application.  
               (7 USC § 2020(u)(2)(A)).

             5)   Establishes in state law a LIHEAP program, "Heat  
               and Eat," which provides a nominal benefit and program  
               information to beneficiaries who, in turn, are able to  
               reduce required paperwork and, in some cases, increase  
               SNAP benefits by qualifying for a standard utility  
               allowance. (WIC 18901.2 (a))


             6)   Creates within federal statute a program of  
               broad-based categorical eligibility which permits  
               states to make qualifying applicants who are eligible  
               for Temporary Assistance to Needy Families (TANF)  
               automatically eligible for SNAP nutrition benefits. (7  
               USC § 2014)


             7)   Creates in California statute a program of  





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               categorical eligibility for CalFresh benefits if an  
               individual is a CalWORKs recipient, or is receiving  
               indigent cash assistance from a county, or is eligible  
               to receive food assistance through the Food Assistance  
               Program for Legal Immigrants (WIC 18930). Participants  
               still must meet other requirements specified in  
               federal law; however, they are not required to go  
               through a separate application process if they do  
               qualify for CalFresh benefits.


             8)   Establishes in state law the Medi-Cal program to  
               provide health care to low-income individuals, as  
               specified. (WIC 14000 et seq.)

           This bill:

              1)   Requires that if the demand for the nominal LIHEAP  
               service benefit exceeds allocated funding established  
               by the California Department of Community Services and  
               Development (CSD) in the LIHEAP state plan, CSD and  
               DSS shall report that information to the Legislature  
               and develop a plan to maintain the program as  
               intended. 

             2)   Prohibits receipt of the nominal LIHEAP service  
               benefit from adversely affecting a CalFresh recipient  
               household's eligibility or reducing a household's  
               CalFresh benefits, in addition to existing  
               prohibitions that the LIHEAP benefit disqualify a  
               CalFresh applicant or beneficiary from receiving other  
               LIHEAP or utility benefits.

             3)   Provides an entitlement for a homeless family to  
               use the homeless shelter deduction in calculating  
               CalFresh benefit levels instead of the full standard  
               utility allowance (SUA), if using the SUA results in a  
               lower amount of CalFresh benefits for a homeless  
               household. 

             4)   Requires DSS, to the extent permitted by federal  
               law, to raise the maximum gross income allowed in the  
               CalFresh gross income test for any individual who is  
               categorically eligible for CalFresh and a member of a  
               household that receives, or is eligible to receive,  





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               medical assistance under the state's Medi-Cal program.

                                  FISCAL IMPACT  

            An Assembly Appropriations Committee analysis concluded  
            this bill would have a number of potential costs and  
            revenues including: 

                     Administrative costs for an estimated 5,000 new  
                 cases of up to $400,000 ($200,000 GF) per year and  
                 approximately $8 million in additional federal  
                 (SNAP) funding. Those federal benefits would  
                 generate more than $200,000 in GF revenue through  
                 increased sales taxes. 

                     Administrative costs for an estimated 60,000  
                 individuals who are Medi-Cal recipients but are not  
                 participating in CalFresh of about $1.5 million  
                 ($750,000 GF) and up to $80 million in additional  
                 federal SNAP funding. Those federal benefits would  
                 generate close to $2 million in GF revenue through  
                 increased sales taxes. 

                     Administrative costs of $787,000 ($393,000 GF)  
                 related to an estimated 10,000 Medi-Cal  
                 beneficiaries who would be added to the program and  
                 would participate in CalFresh as a result of federal  
                 health care reform in 2014. The federal benefits  
                 would generate over $1 million in GF revenue through  
                 increased sales taxes. 

                     Approximately $3 million (GF) annually for an  
                 estimated 750 new participants in the California  
                 Food Assistance Program (CFAP), which provides  
                 nutrition benefits for recent, legal immigrants who  
                 are ineligible for federal SNAP benefits.  The  
                 nutrition benefits provided to those families will  
                 generate approximately $80,000 in state sales tax  
                 revenue. 


                            BACKGROUND AND DISCUSSION  

           Purpose of the bill






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           According to the author, while nutrition is a critical  
          component of overall health and wellbeing, many households  
          with a Medi-Cal recipient who would be otherwise eligible  
          for the program are barred from participating in the  
          program because they have a gross income above the CalFresh  
          limit. This means that while they would qualify under net  
          income qualifications, it is only the CalFresh gross income  
          test that prevents otherwise eligible households from  
          accessing CalFresh food benefits. These households  
          typically are working poor families with high expenses,  
          such as child care costs.
          
          Under this bill, these families' gross income test would be  
          raised from the current limit of 130% of Federal Poverty  
          Level (FPL) to 200% of FPL. The net income test would still  
          apply. The FPL in 2013 for a family of four is $23,550  
          annually. The author states that this bill has the  
          potential to increase CalFresh participation by 227,000  
          Californians. 
          
          This policy additionally would benefit children of these  
          families because children in CalFresh households are  
          automatically enrolled for free school meals, through an  
          existing process called direct certification, the author  
          writes. According to California Food Policy Advocates  
          (CFPA), of the 2.5 million Medi-Cal beneficiaries who are  
          currently eligible for CalFresh, only 1.3 million actually  
          participate in the program, or just over half.
           
          The author further states that AB 191 could bring up to $10  
          million in federal nutrition benefits to the state.  
          According to USDA estimates, every SNAP (CalFresh) dollar  
          spent generates $1.79 in economic activity. The author also  
          states that this bill would also bring California up to  
          speed with 27 other states that have used categorical  
          eligibility to increase CalFresh access. 
          
          Additionally, this bill was amended to include cleanup  
          language from AB 6 (Fuentes, Chapter 501, Statutes of  
          2011), which created California's "Heat and Eat" program to  
          permit applicants to draw down a nominal LIHEAP benefit  
          and, by extension, simplify the application process for  
          beneficiaries. The cleanup language, which is mirrored in  
          this year's Human Services budget trailer bill, AB 74  
          (Committee on Budget, 2013), would ensure that if payments  





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          from the program exceed allocated funding, the state and  
          legislature would work out a plan to ensure the  
          continuation of the program. It also prohibits use of the  
          LIHEAP benefit from disadvantaging any applicant or  
          beneficiary of the program. The final cleanup piece from AB  
          6 is to permit applicants and caseworkers to apply the  
          homeless shelter deduction rather than the standard utility  
          allowance (SUA) if the homeless deduction results in a  
          higher food benefit for a household. 

           CalFresh

           CalFresh food benefits for low-income, needy Californians  
          are wholly funded through the SNAP program at the US  
          Department of Agriculture (USDA). CalFresh is administered  
          locally by county welfare departments, and the federal,  
          state, and county governments share in the cost of  
          administration of the program.

          Generally, eligibility for the program is determined by the  
          USDA and is consistent across the nation, although states  
          may seek waivers to modify some elements of the program. It  
          includes a gross and net income asset test, work  
          requirements, and other documentation requirements. From  
          that information, a caseworker calculates eligibility and  
          benefits based on specified income and deductions. 

          Currently, the maximum allowable gross income is 130% of  
          the Federal Poverty Level (FPL).  All households must meet  
          both gross and net monthly income thresholds to qualify,  
          with the exception of households with elderly or disabled  
          members who are not subject to gross income criteria but  
          must have a net monthly income at or below 100% of the FPL.  
           Cash resources generally cannot exceed $2,000, or $3,250  
          for households in which there is a household member who has  
          a disability or is 60 years of age or older.  The average  
          CalFresh benefit per household per month is $336 ($153 per  
          person), with nearly 1.9 million households in California  
          receiving benefits. The CalFresh benefit is delivered on an  
          EBT card, which can be swiped at grocery stores, farmer's  
          markets and other food sales locations.


           Categorical Eligiblity






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           Federal law provides two pathways for SNAP eligibility:  
          either by meeting federal eligibility requirements, or by  
          being automatically or "categorically" eligible for SNAP,  
          based on being eligible for other low-income assistance  
          programs. In April 2012, there were 46 million people in 22  
          million households benefitting from SNAP, according to a  
          summary of the program by the Congressional Research  
          Service in 2012. 

          Traditionally across the country, categorical eligibility  
          establishes the eligibility for SNAP benefits through  
          eligibility in the state TANF program or other specified  
          public benefits. In California, this translates to  
          categorical eligibility for CalFresh benefits if the  
          recipient is eligible for or receiving the CalWORKs  
          benefits, or county-run General Assistance programs.  
          Additionally, the 1996 welfare reform law permitted states  
          to convey categorical eligibility to recipients of a TANF  
          "benefit," beyond cash aid, based on a wide range of  
          benefits and services. TANF benefits other than cash  
          assistance typically are available to a broader range of  
          households and at higher levels of income than are TANF  
          cash assistance benefits.<1> In total, 43 jurisdictions  
          have implemented what the USDA has called "broad-based"  
          categorical eligibility.

          Recent efforts in Congress to eliminate the Categorical  
          Eligibility program have thus far been unsuccessful,  
          however, the issue has arisen several times in recent  
          years, including in current conversations about the federal  
          funding for SNAP.
           
          Participation rate

           California's SNAP participation rates have consistently  
          ranked among the lowest in the nation. In 2010, just 55  
          percent of all eligible individuals participated in  
          CalFresh, according to USDA data, which is an improvement  
          over prior years. Since the beginning of the recession,  
          CalFresh enrollment has increased approximately 21 percent  
          from FY 2009 to FY 2010. Still, that growth has not met the  
          -------------------------
          <1> Falk, Gene and Randy Alison Aussenberg, "The  
          Supplemental Nutrition Assistance Program: Categorical  
          Eligibility," Congressional Research Service, July 17,  
          2012.




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          growing need for nutrition assistance, according to a 2013  
          report, "Lost Dollars, Empty Plates," published by the  
          California Food Policy Advocates.<2>

          According to the report, more than 4.1 million Californians  
          were participating in CalFresh as of November 2012, up from  
          3.9 million participants a year earlier. The USDA's target  
          participation rate for states was 71 percent in 2011.  
          Between 2004 to 2008, CalFresh served approximately  
          one-third of California's eligible working poor and no more  
          than half of all eligible individuals in the state.  From  
          FFY 2002 to 2006, CalFresh served no more than 11 percent  
          of the state's eligible seniors, 60 years or older.  

          CalFresh participants received more than $612 million in  
          federal monthly nutrition assistance benefits for eligible  
          children, adults, and seniors, for an average household  
          benefit of $332 per month during FY 2012.
           

          Related legislation
           
          AB 6 (Fuentes) Chapter 501, Statutes of 2011 made a number  
          of broad changes to CalFresh policy, including implementing  
          "Heat and Eat," to draw federal funds from the LIHEAP block  
          grant and to simplify verification of utility costs for  
          CalFresh applicants.
          
          AB 1560 (Fuentes, 2012) was identical to this bill.  It was  
          held on the suspense file in the Senate Appropriations  
          Committee.
           
           AB 433 (Beall) Chapter 623, Statutes of 2008, established  
          categorical eligibility for CalFresh benefits for  
          individuals at or below 130% of the federal poverty level,  
          regardless of the level of their assets.  Language that  
          would have established categorical eligibility for Medi-Cal  
          beneficiaries was stripped from the final version of the  
          bill. 

          AB 2205 (Evans, 2006) would have established CalFresh  
          categorical eligibility for Medi-Cal recipients if they  
          -------------------------
          <2>  
          http://cfpa.net/CalFresh/CFPAPublications/LDEP-FullReport-20 
          13.pdf




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          were eligible for or receiving services from the CalWORKs  
          program.  This bill was vetoed by the governor. 

                                     COMMENTS

              1.   Identical language regarding LIHEAP benefits and  
               use of the Standard Utilities Allowance (SUA) for  
               homeless families is included in this year's Human  
               Services trailer bill, AB 74 (Committee on Budget).  
               The trailer bill was passed by both houses on June 14,  
               2013. Staff recommends deleting this language from the  
               bill as it is now redundant. 

               Staff recommends the following amendment:  Remove  
          Section 1 from this bill.

             2.   In response to concerns that the bill's language  
               could permit the higher gross income test for  
               additional participants, the author has proposed  
               amending the bill to clarify that the gross income  
               test change shall only apply to individuals determined  
               categorically eligible for CalFresh because of their  
               Medi-Cal eligibility. Staff recommends the following  
               amendment:
          
                (2) The department, to the extent permitted by federal  
               law, shall raise the maximum gross income allowed in  
               the CalFresh gross income test for any individual who  
               is categorically eligible for CalFresh pursuant to  
               paragraph (1), and who is a member of a household that  
               receives, or is eligible to receive, medical  
               assistance under Chapter 7 (commencing with Section  
               14000) of Part 3. 
                
                (2) The department shall to the extent permitted by  
               federal law, design and implement a program of  
               categorical eligibility for CalFresh, for the purposes  
               of establishing the gross income limit for the  
               TANF/MOE funded service that confers categorical  
               eligibility for any household who is categorically  
               eligible pursuant to section (1) and that includes a  
               member that receives, or is eligible to receive,  
               medical assistance under chapter 7 (commencing with  
               section 1400) of Part 3. 
           





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                                  PRIOR VOTES  


          Assembly Floor:               54 - 23
          Assembly Appropriations       12 - 5
          Assembly Human Services         5 - 2


                                    POSITIONS  

          Support:       AARP
                         AFSCME
                         Alameda County Community Food Bank
                         Asian Law Alliance
                         California Association of Food Banks
                         California Catholic Conference
                         California Food Policy Advocates
                         County Health Executives Association of  
          California (CHEAC)
                         Feeding America San Diego
                         Food for People, Inc.
                         Greenlining Institute 
                         Health Access California
                         Interfaith Community Services
                         Jewish Family Service of Los Angeles
                         Jewish Family Service of San Diego
                         Latino Coalition for a Healthy California
                         National Association of Social Workers
                         San Diego Hunger Coalition
                         San Francisco and Marin Food Banks
                         Second Harvest Food Bank
                         St. Anthony Foundation
                         Women Organizing Resources Knowledge &  
          Services

          Oppose:   None received 






                                   -- END --
          





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