BILL ANALYSIS Ó
AB 1747
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Date of Hearing: May 18, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1747 (Weber) - As Amended May 11, 2016
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| |Higher Education | |11 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY: This bill requires, as a condition of participation in
the Cal Grant Program, each public and private postsecondary
educational institution to take a number of steps to facilitate
student access to nutrition programs. Specifically, this bill:
1)Requires a public or private postsecondary education
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institution, as a condition of its participation in the Cal
Grant Program, to do all of the following:
a) Ensure campus access to surcharge-free transactions
using the electronic benefits transfer (EBT) system, except
for the imposition of a surcharge by an owner or operator,
other than the institution, of an automated teller machine
on a campus, or an issuer of an EBT card, if otherwise
permitted by law.
b) Increase access to, and information about, the
Restaurant Meals Program on campus, as specified; and
1)Specifies that a public or private postsecondary education
institution is not required to create, operate, or maintain an
EBT system on behalf of on-campus food vendors.
2)Allows public postsecondary educational institutions that are
successful in raising money for CalFresh outreach activities
to receive matching funds from the United States Department of
Agriculture, as specified.
3)Creates the Public Higher Education Pantry Assistance Program
Account in the Emergency Food Assistance Program, and
allocates funds in the account to food banks if:
a) The primary function of the food bank is the
distribution of food to low-income households; and
b) The food bank has identified specific costs associated
with supporting on-campus pantry and hunger relief efforts
serving low-income students.
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FISCAL EFFECT:
1)Community Colleges. Unknown one-time costs to California
Community Colleges, likely in the high tens of thousands of
dollars (GF/Prop 98), to install and set up stand-alone
terminals and design and implement the system
administratively. Ongoing costs, likely in the hundreds of
thousands of dollars (GF/Prop 98) to cover associated fees and
operating costs. There are 72 community college districts and
113 campuses statewide. Assuming a cost of approximately $250
per terminal, one terminal on each of the 113 campuses would
cost approximately $28,250. This would be higher if to the
extent each campus had multiple terminals. Vendor fees will
likely be approximately $200,000 annually statewide based on
available data.
This bill conditions receipt of state funds for student
financial aid on community college districts providing
surcharge-free EBT access on each campus. If a community
college district submits a claim for reimbursement, the
Commission on State Mandates could determine activities
related this requirement to be a reimbursable mandate based on
practical compulsion - that there is no reasonable alternative
but to comply with bill's requirement.
2)California State University (CSU). Unknown one-time costs to
the CSU, likely in the thousands of dollars (GF), to install
and set up stand-alone terminals and pay vendor fees.
Assuming a cost of approximately $250 per terminal, one
terminal on each of the 23 campuses would cost approximately
$5,750. This number could vary as some campuses may already
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have terminals and others may want more than one. On-going
costs to cover vendor fees, likely be in the low thousands of
dollars (GF) per campus annually, based on available data.
3)University of California (UC). Unknown one-time costs to the
UC, likely in the hundreds of thousands of dollars (GF), to
install and set up stand-alone terminals and to make software
and hardware adjustments to campus infrastructure. Assuming
one terminal on each of the 10 campuses, total cost would be
approximately $2,500. On-going costs to pay vendor fees,
likely in the low thousands of dollars (GF) per campus
annually, based on available data. In addition, UC
anticipates on-going costs of approximately $500,000 for 0.5
FTE staff per campus to coordinate with departments and ensure
compliance with the bill's requirements.
4)Minor and absorbable costs associated with applying to become
an approved vendor for the Restaurant Meals Program.
COMMENTS:
1)Purpose. This bill seeks to address the growing incidence of
hunger among low-income college students in California. A
growing number of college students are enrolled in SNAP, but
few students who receive SNAP benefits can purchase food on
college campuses. According to a December 2015 report, by
Wisconsin Hope Lab, entitled, "Hungry to Learn: Addressing
Food and Housing Insecurity Among Undergraduates," of a survey
of more than 4,000 undergraduates at 10 community colleges
across the nation, half of all of the respondents reported
that they struggle with food and/or housing insecurity. The
report also found that 20 percent of the student respondents
indicated that they are hungry.
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2)Electronic Benefit Transfer (EBT). EBT is an electronic
system that automates the delivery, redemption, and
reconciliation of issued public assistance benefits such as
CalWORKs and Cal Fresh benefits. EBT is currently used in all
50 states. In California, CalWORKs and CalFresh recipients
access their benefits via what has been named the Golden State
Advantage EBT card. Like a bank-issued automated teller
machine (ATM) card, the cardholder slides this card through a
point-of-sale (POS) device, or uses the card at an ATM.
Under existing law, the electronics benefit processor cannot
charge a recipient a fee for cash transactions until after the
fourth transaction within a month; however surcharges for
subsequent transactions currently range from $1.00 to $3.50.
In 2014-15, low-income Californians paid more than $19 million
in EBT related surcharge fees to banks, according to data from
the California Department of Social Services.
This bill requires an education institution to ensure
surcharge-free EBT access on each campus, except that banks
can continue to impose their surcharges.
3)CalFresh. CalFresh benefits are funded by the federal
government through the Supplemental Nutrition Assistance
Program (SNAP), and the United States Department of
Agriculture (USDA) sets specific eligibility requirements for
SNAP programs across the United States. The maximum allowable
gross income is 200% of the Federal Poverty Level (FPL).
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 or at
ATM machines. The average monthly benefit for a CalFresh
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recipient is $144.35 per month, or $4.81 per person per day.
4)Restaurant Meal Program: Under SNAP rules, recipients are
limited to purchasing only non-prepared food items; however
some people are less able to use SNAP food benefits in
traditional ways due to the lack of necessary tools,
appliances or physical abilities required to prepare their own
meals. Accordingly, SNAP allows states to participate in the
Restaurant Meal Program option, which allows SNAP recipients
to purchase hot prepared food in authorized restaurants.
California operates the largest Restaurant Meal Program and
has allowed counties to utilize this option since 2003.
This bill requires education institutions located in counties
that participate in the Restaurant Meals Program to apply to
become an approved food vendor if they have a qualifying food
facility on campus, and to provide information to all their
on-campus food vendors regarding the Program, including how to
apply.
5)Prior Legislation.
a) AB 832 (Weber), 2013, would have required all
convenience stores and bookstores at the California State
University, the University of California, and community
colleges to accept the use of EBT cards. It was held in
the Assembly Human Services Committee.
b) AB 756 (Mitchell), 2011, would have prohibited
surcharges on ATM withdrawals and POS transactions for
CalWORKs recipients when they use their state-issued EBT
card. It was held in the Assembly Human Services
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Committee.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081