BILL ANALYSIS Ó
AJR 35
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Date of Hearing: April 26, 2016
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Susan Bonilla, Chair
AJR 35
(Brown) - As Introduced March 17, 2016
SUBJECT: Supplemental Nutrition Assistance Program: cash-out
policy
SUMMARY: Memorializes the California Legislature's request to
the federal government to enable California to end the
Supplemental Nutrition Assistance Program (SNAP) cash-out policy
in such a way as to maximize benefits and participation while at
the same time mitigating or eliminating harm for those
households that would currently be detrimentally impacted by
ending the policy.
Specifically, this bill:
1)Makes a number of declarations, including:
a) The federal SNAP, formerly known as the Food Stamp
Program, offers nutrition to millions of eligible,
low-income individuals and families, and yet, many
low-income seniors and people with disabilities in
California cannot receive SNAP benefits;
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b) CalFresh, California's SNAP program, provides monthly
benefits to millions of eligible low-income Californians
through an electronic benefit transfer (EBT) card that can
be used to purchase food;
c) SNAP benefits are provided on a sliding scale based on
income, household size, and certain household expenses;
d) The federal Supplemental Security Income (SSI) program
provides income support to the elderly, blind, or disabled
who meet income and other eligibility criteria, and is
supplemented by the State Supplementary Payment program
(SSP);
e) 1.3 million SSI/SSP recipients in California are
ineligible for SNAP due to the cash-out policy;
f) California's cash-out policy, established in 1974,
allowed California to cash out SNAP benefits to SSI/SSP
recipients by including the estimated values of SNAP
benefits, approximately $10 per month in California at the
time, within SSI/SSP benefits, thereby reducing
administrative and other expenditures, and also preventing
SSI/SSP recipients in California from being eligible for
SNAP;
g) California is the only state in which SSI/SSP recipients
are ineligible for SNAP under the cash-out policy;
h) California's SSI/SSP recipients currently live closer
to, or below, the federal poverty level (FPL) than when the
program began;
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i) SSI/SSP benefits have risen and fallen over time, and
the annual cost-of-living-adjustment (COLA) for SSI/SSP was
repealed in the state in 2009;
j) SSI/SSP recipients in California would, on average, be
eligible for more CalFresh benefits than the $10 monthly
amount;
aa) Technology has advanced to a point where electronic
benefits could be made available to an SSI/SSP recipient if
the state developed a method of activating an EBT card by
asking questions telephonically, or through other efficient
means, to determine if the automatically calculated
benefits are correct;
bb) California's cash-out policy hurts many low-income
seniors and people with disabilities and continuing this
policy poses many significant risks to these individuals'
health and well-being; and
cc) California's cash-out policy benefits some mixed SSI/SSP
households, where some members of the household receive
SSI/SSP benefits and other members do not, resulting in
greater CalFresh benefits overall, and California could
provide mixed SSI/SSP households with alternative benefits
to replace the reduced or eliminated CalFresh benefits
resulting from an end to the cash-out policy.
2)Resolves that the California Legislature requests the federal
government to change federal policy in order to allow
California to equitably end the SNAP cash-out policy in a way
that would maximize benefits for and participation of
newly-eligible individuals while at the same time mitigating
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or eliminating harm to low-income families and medically needy
children who could be made ineligible for certain benefits
under a program without a cash-out policy.
3)Resolves that the Chief Clerk of the Assembly transmit copies
of the resolution in question to the President and Vice
President of the United States, and the Speaker of the House
of Representatives, the Majority Leader of the Senate, each
Senator and Representative from California in the Congress of
the United States, and the author.
EXISTING LAW:
1)Establishes under federal law the Supplemental Nutrition
Assistance Program (SNAP) pursuant to the Food Stamp Act of
1964 and establishes, in California statute, the CalFresh
program to administer the provision of federal SNAP benefits
to families and individuals meeting certain criteria, as
specified. (WIC 18900 et seq.)
2)Establishes the Electronic Benefits Transfer (EBT) Act, and
defines the EBT system as the program designed to provide
benefits to those eligible to receive public assistance
benefits such as CalWORKs and CalFresh. (WIC 10065 et seq.)
3)Establishes the State Supplementary Program for Aged, Blind
and Disabled, which is intended to supplement SSI and provide
persons whose need results from age, blindness or disability
with assistance and services that help them meet basic needs
and maintain or increase independence. (WIC 12000 et seq.)
4)Provides that eligibility requirements for SSP match federal
SSI criteria, and requires a minimum level of SSP benefits to
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be provided in order to maintain federal Medicaid funding, as
specified. (WIC 12000 et seq.)
5)Prohibits an individual who receives SSI and/or SSP benefits
as a resident of California from receiving food stamp
benefits. (7 CFR § 273.20 (a))
6)Disregards the income and resources of an SSI recipient living
in a household from CalFresh eligibility and benefit
determination for that household. (7 CFR § 273.20 (c))
FISCAL EFFECT: Unknown.
COMMENTS:
CalFresh: CalFresh benefits are funded entirely by the federal
government through SNAP, and the United States Department of
Agriculture (USDA) sets specific eligibility requirements for
SNAP programs across the United States, including a gross and
net income test, work requirements, and other documentation
requirements. The maximum allowable gross income is typically
200% of the Federal Poverty Level (FPL). Households with
elderly or disabled members are not subject to gross income
criteria but must have a net monthly income at or below 100% of
the FPL. Other households must meet both gross and net monthly
income tests. CalFresh is administered locally by county human
services agencies, and the federal, state, and county
governments share in the cost of administration of the program.
Benefits are made available on a monthly basis for food purchase
through an ATM-like EBT card. However, unlike other types of
benefits that may be accessed through an EBT card, CalFresh
benefits cannot be withdrawn in cash at point-of-sale terminals
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or at ATM machines. CalFresh benefits can only be used to
purchase food items to be prepared and consumed at home, as well
as seeds and plants that can be grown at home and produce food.
The average monthly benefit for a CalFresh recipient is $144.35
per month, or $4.81 per person per day.
SSI/SSP: The SSI/SSP program provides a monthly cash benefit to
needy aged, blind, and disabled individuals and couples to help
them pay for basic living expenses, such as food, clothing and
shelter. In order to be eligible for SSI/SSP, an individual
must be 65 years of age or older, blind, or have disabilities
(children who are blind or have disabilities can qualify), and
must meet certain federal income and resource requirements. The
SSI portion of the benefit is federally-funded and only provided
through an approved application to the Social Security
Administration (SSA), while the SSP portion is paid for with
General Fund dollars, and a qualified SSI recipient is
automatically qualified for SSP. The SSI portion of the grant
is meant to provide an income floor for qualifying low-income
individuals and couples.
SSI/SSP grants are adjusted based on whether a recipient is
aged, blind or disabled; the individual's or couple's living
arrangement, a recipient's marital status, and a recipient's
status as a minor. The current SSI/SSP maximum grant levels are
$889.40 per month for an individual ($156.40 SSP) and $1,496 per
month for couples ($396.20 SSP), which places individuals at 90%
of poverty and couples at 112% of poverty based on federal
guidelines. The estimated SSI/SSP caseload for 2016-17 is 1.31
million cases (including 1.51 million people), which are
composed of 28% aged persons, 1% blind persons and 71% persons
with disabilities. Over 81% of SSI/SSP cases are individual
cases.
The Social Security Administration applies an annual cost of
living adjustment (COLA) to the SSI portion of the grant
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pursuant to annual increases in the Consumer Price Index (CPI).
This federal COLA is passed through to SSI/SSP recipients in
California, which allows SSI/SSP grants to remain at the minimum
level allowed under federal law for individuals and couples,
thereby allowing the state to maintain its federal Medicaid
funding. During the state's economic downturn, the SSI/SSP
program was one of many safety net programs negatively impacted.
The COLA California once applied to the SSP amount was made
inoperative as part of the 2009-10 Budget Act.
The Governor's 2016-17 Budget proposed in January includes a
cost-of-living increase to the SSP beginning January 1, 2017,
that is equal to the California Necessities Index (CNI),
estimated to be 2.96%. This will have the effect of increasing
SSI/SSP monthly grant amounts by $17 for individuals and $31 for
couples.
Cash-out policy: California's cash-out policy dates back to
1974. That year, the federal government began the combined
SSI/SSP program and, among other things, authorized states to
increase the amount of their SSP to include the value of the
food stamp allotment in lieu of separately administering food
stamps to SSI/SSP recipients, with the goal of lowering
administrative costs. This meant that California increased its
monthly SSP grant by $10. Today, California remains the only
state with a cash-out policy.
In "mixed" households that contain a disabled or elderly
household member who receives SSI/SSP, the SSI/SSP income is
disregarded when determining the household's CalFresh
eligibility and level of benefits. This means that ending the
cash-out policy could create "winners" and "losers": SSI/SSP
recipients would stand to gain higher levels of food assistance
by becoming eligible for CalFresh, while mixed households could
see their nutrition assistance reduced or eliminated if the
SSI/SSP income is now counted for purposes of determining
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household CalFresh eligibility and benefit levels. Currently,
according to the author, it is estimated that approximately
60,000 medically needy children in mixed households may be
detrimentally impacted by ending the state's cash-out policy.
Need for this bill: According to the author, "The Federal
Supplemental Nutrition Assistance Program (SNAP), known as
CalFresh in our state, supports millions of low-income
Californians. Unfortunately, 1.3 million SSI/SSP recipients are
ineligible for CalFresh benefits because of a policy known as
'cash-out.' This policy, which only impacts California, started
in 1974 when the federal government began the combined
federal-state SSI/SSP program. A $10 food-stamp benefit was
traded for a $10 cash benefit due to the extreme administrative
costs of delivering the $10 food stamp benefit. This policy
made sense in the mid 1970's, but today, it is hurting our poor
vulnerable populations because the $10 cash benefit has been
decimated by decades of budget and fiscal changes. California's
SSI/SSP recipients are living much closer to, or below, the
federal poverty level than they were when the program began.
While ending the program would solve this problem, doing so
without a change to federal policy would reduce benefits for
approximately 58,000 medically dependent children. A federal
change would allow California to provide CalFresh benefits to
SSI/SSP recipients and maintain the current benefits for
medically dependent children."
REGISTERED SUPPORT / OPPOSITION:
Support
Bay Area Community Services
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California Alliance for Retired Americans
California Association of Public Affairs (CAPA)
Mercy Brown Bag Program
Personal Assistance Services Council of Los Angeles County
Resources for Independent Living
San Francisco Senior Disability Action
St. Mary's Center
Opposition
None on file.
Analysis Prepared by:Daphne Hunt / HUM. S. / (916) 319-2089
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