BILL NUMBER: AB 1280	AMENDED
	BILL TEXT

	AMENDED IN SENATE  AUGUST 20, 2013
	AMENDED IN SENATE  AUGUST 12, 2013
	AMENDED IN SENATE  JUNE 13, 2013

INTRODUCED BY   Assembly Member John A. Pérez

                        FEBRUARY 22, 2013

   An act to add Section 1339.1 to the Unemployment Insurance Code,
and to amend Section 11006.2 of the Welfare and Institutions Code,
relating to health and human services.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1280, as amended, John A. Pérez. Public assistance payments and
unemployment compensation benefits: electronic fund transfer:
qualifying accounts.
   Existing law provides for protection, care, and assistance for
people of the state, and the promotion of the welfare and happiness
of all people in the state by providing appropriate aid and services
to the needy and distressed. Programs established for this purpose
include the California Work Opportunity and Responsibility to Kids
(CalWORKs) Program, which provides cash assistance and other social
services to needy families, using federal Temporary Assistance for
Needy Families (TANF) block grant program, state, and county funds,
and CalFresh, whereby nutrition assistance benefits allocated to the
state by the federal government are distributed to eligible
individuals by each county. Counties administer the CalWORKs and
CalFresh programs.
   Existing law authorizes the State Department of Social Services to
provide for the delivery of public assistance payments at any time
during the month and authorizes any person entitled to the receipt of
public assistance payments to authorize payment to be directly
deposited by electronic fund transfer into the person's account at a
financial institution of his or her choice under a program of direct
deposit by electronic transfer established by the county treasurer.
Existing law requires each county treasurer to make an agreement with
one or more financial institutions participating in the Automated
Clearing House and to, by December 1, 2001, establish a program for
the direct deposit by electronic fund transfer of payments to any
person entitled to the receipt of public assistance benefits who
authorizes the direct deposit of the benefits into the person's
account at the financial institution of his or her choice.
   This bill would instead authorize a person entitled to receipt of
public assistance payments to authorize payment to be directly
deposited by electronic fund transfer to a qualifying account, as
defined, at a financial institution of his or her choice under a
program for direct deposit by electronic transfer, as established by
the bill. The bill would require qualifying accounts to meet
specified requirements. The bill would provide that each county
treasurer has no obligation to determine whether the account at the
financial institution of the person's choice is a qualifying account,
as specified.
   Existing law also provides for unemployment compensation benefits
to eligible persons who are unemployed through no fault of their own.
These provisions are generally administered by the Employment
Development Department.
   This bill would, if unemployment compensation benefit payments are
directly deposited to an account of the recipient's choice, require
that the payments only be deposited to a qualifying account, as
defined. The bill would provide that the Employment Development
Department has no obligation to determine whether an account at the
financial institution of the recipient's choice is a qualifying
account, as specified.
   This bill would prohibit a person or entity that issues a prepaid
card or maintains or manages a prepaid card account, as defined, from
accepting or facilitating the direct deposit of public assistance
payments or unemployment compensation benefits to a prepaid card
account that does not meet the requirements of a qualified account.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1339.1 is added to the Unemployment Insurance
Code, to read:
   1339.1.  (a) (1) Notwithstanding any other provisions of this
part, if unemployment compensation benefit payments are directly
deposited to an account of the recipient's choice, as authorized
under the federal Electronic Fund Transfer Act (EFTA) (15 U.S.C. Sec.
1693 et seq.), the payments may only be deposited to an account that
meets the requirements of a qualifying account, as defined in
paragraph (2), for deposit of public assistance payments, including
unemployment compensation benefits.
   (2) For purposes of this section, a "qualifying account" is one of
the following:
   (A) A demand deposit or savings account at an insured financial
institution in the name of the person entitled to receipt of public
assistance payments.
   (B) A prepaid card account that meets all of the following:
   (i) The account is held at an insured financial institution.
   (ii) The account is set up to meet the requirements for
passthrough deposit or share insurance so that the funds accessible
through the account are  insured   eligible for
insurance  for the benefit of the person entitled to the receipt
of public assistance payments by the Federal Deposit Insurance
Corporation in accordance with Part 330 of Title 12 of the Code of
Federal Regulations, or the National Credit Union Share Insurance
Fund in accordance with Part 745 of Title 12 of the Code of Federal
Regulations.
   (iii) The account is not attached to any credit or overdraft
feature that is automatically repaid from the account after delivery
of the payment.
   (iv) The issuer of the card complies with all of the requirements,
and provides the holder of the card with all of the consumer
protections, that apply to a payroll card account under the rules
implementing the EFTA or other rules subsequently adopted under the
EFTA that apply to prepaid card accounts.
   (3) A person or entity that issues a prepaid card or maintains or
manages a prepaid card account that does not comply with paragraph
(2) shall not accept or facilitate the direct deposit of 
public assistance payments, including  unemployment
compensation  benefits,   benefit payments 
to the prepaid card account.
   (b) The department has no obligation to determine whether an
account at the financial institution of the recipient's choice is a
qualifying account, as described in subdivision (a). For purposes of
this section, the department shall not be held liable for authorizing
a direct deposit of unemployment compensation benefit payments into
a prepaid card account designated by the recipient that does not
comply with paragraph (2) of subdivision (a).
   (c) For the purposes of this section, the following definitions
shall apply:
   (1) "Financial institution" means a state or national bank, a
state or federal savings and loan association, a mutual savings bank,
or a state or federal credit union.
   (2) "Issuer" means a person or entity that issues a prepaid card.
   (3) "Payroll card account" shall have the same meaning as that
term is defined in the regulations implementing the EFTA.
   (4) "Prepaid card" or "prepaid card account" means either of the
following:
   (A) A card, code, or other means of access to funds of a recipient
that is usable at multiple, unaffiliated merchants for goods or
services, or usable at automated teller machines.
   (B) The same as those terms or related terms are defined in the
regulations adopted under the EFTA regarding general use reloadable
cards.
  SEC. 2.  Section 11006.2 of the Welfare and Institutions Code is
amended to read:
   11006.2.  (a) The department may provide for the delivery of
public assistance payments at any time during the month.
   (b) (1) Notwithstanding any other law, any person entitled to the
receipt of public assistance payments may authorize payment to be
directly deposited by electronic fund transfer into the person's
qualifying account at the financial institution of his or her choice
under a program for direct deposit by electronic transfer as
established in this section. The direct deposit to a qualifying
account shall discharge the department's obligation with respect to
the payment.
   (2) Each county treasurer shall make an agreement with one or more
financial institutions participating in the Automated Clearing House
pursuant to the local rules, and shall, by December 1, 2001,
establish a program for the direct deposit by electronic fund
transfer of payments to any person entitled to the receipt of public
assistance benefits who authorizes the direct deposit of the benefits
into the person's qualifying account at the financial institution of
his or her choice. Each county treasurer has no obligation to
determine whether the account at the financial institution of the
person's choice is a qualifying account, as defined in paragraph (3).

   (3) For purposes of this section, a "qualifying account" is one of
the following:
   (A) A demand deposit or savings account at an insured financial
institution in the name of the person entitled to receipt of public
assistance payments.
   (B) A prepaid card account that meets all of the following:
   (i) The account is held at an insured financial institution.
   (ii) The account is set up to meet the requirements for
passthrough deposit or share insurance so that the funds accessible
through the account are  insured   eligible for
insurance  for the benefit of the person entitled to the receipt
of public assistance payments by the Federal Deposit Insurance
Corporation in accordance with Part 330 of Title 12 of the Code of
Federal Regulations, or the National Credit Union Share Insurance
Fund in accordance with Part 745 of Title 12 of the Code of Federal
Regulations.
   (iii) The account is not attached to any credit or overdraft
feature that is automatically repaid from the account after delivery
of the payment.
   (iv) The issuer of the card complies with all of the requirements,
and provides the holder of the card with all of the consumer
protections, that apply to a payroll card account under the rules
implementing the federal Electronic Fund Transfer Act (EFTA) (15
U.S.C. Sec. 1693 et seq.) or other rules subsequently adopted under
the EFTA that apply to prepaid card accounts.
   (4) A person or entity that issues a prepaid card or maintains or
manages a prepaid card account that does not comply with paragraph
(3) shall not accept or facilitate the direct deposit of public
assistance payments to the prepaid card account.
   (5) For purposes of this section, each county treasurer and county
welfare department shall not be held liable for authorizing a direct
deposit of public assistance payments into a prepaid card account,
designated by the person entitled to receipt of public assistance
benefits, that does not comply with paragraph (3).
   (6) This subdivision shall apply in each county that offers a
program for direct deposit by electronic funds transfer to some or
all of its employees.
   (c) For the purposes of this section, the following definitions
shall apply:
   (1) "Financial institution" means a state or national bank, a
state or federal savings and loan association, a mutual savings bank,
or a state or federal credit union.
   (2) "Issuer" means a person or entity that issues a prepaid card.
   (3) "Payroll card account" shall have the same meaning as that
term is defined in the regulations implementing the EFTA.
   (4) "Prepaid card" or "prepaid card account" means either of the
following:
   (A) A card, code, or other means of access to funds of a recipient
that is usable at multiple, unaffiliated merchants for goods or
services, or usable at automated teller machines.
    (B) The same as those terms or related terms are defined in the
regulations adopted under the EFTA regarding general use reloadable
cards.