BILL ANALYSIS Ó AB 2054 Page 1 Date of Hearing: April 20, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair AB 2054 (Thurmond) - As Introduced February 17, 2016 ----------------------------------------------------------------- |Policy |Human Services |Vote:|6 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill directs the California Health and Human Services Agency to design and implement the Summer Electronic Benefits Transfer for Children (SEBTC). Specifically, this bill: 1)Defines "SEBTC," to mean a program, pilot, or demonstration project that provides nutrition assistance when school is out of session via electronic benefits transfer (EBT) to households with children eligible for free and reduced price meals, as specified. AB 2054 Page 2 2)Requires the California Department of Health and Human Services Agency, in conjunction with other agencies as specified, and pursuant to federal approval and/or authorization, to design and implement the SEBTC to provide nutrition assistance benefits to eligible households. 3)Requires the SEBTC system to be compatible with the State's existing EBT system, comply with any federal laws and regulations governing SEBTC, and comply with any and all privacy and confidentiality procedures, as specified. FISCAL EFFECT: 1)Unknown costs, but likely in the hundreds of millions of dollars, to fund the benefit level provided to eligible households. The bill does not specify a benefit level but, for example, if the monthly benefit was $45 per child (as proposed in the Federal budget), the annual cost to fund the benefit level would be approximately $918.5 million, based on an estimated caseload of 1.7 million eligible children. If the proposed federal program is in place, this cost would be 100% federally funded. Absent the program, the program would be entirely state funded. 2)Unknown, but potentially significant costs for automation, design, implementation and operation of a Summer EBT program. If a Federal program is in place, such as is proposed in the 2017 federal budget, these costs would be a shared federal/state/county cost (50/35/15). Otherwise, these costs would be entirely state funded. COMMENTS: AB 2054 Page 3 1)Purpose. According to the author, "Research and common sense tell us that children need year-round access to nutritious meals in order to learn, grow, and achieve at their full potential?Research also shows that food insecurity increases during the summer months. Currently, federally funded summer meal programs operate in a number of communities across California. While summer meal programs provide valuable resources when and where they are able to reach children, nearly 90% of low-income school-age children in California are not served by these programs?Complex problems like child hunger need multiple solutions. Fortunately, one clear solution has already been rigorously tested and proven effective: Summer Electronic Benefits for Children. SEBTC provides nutrition assistance for the purchase of groceries when school is out of session and children lose access to school meals. This bill will prepare California to implement SEBTC, which has been successfully serving children in other areas of the country since 2011." 2)Background. Electronic Benefit Transfer (EBT) is an electronic system that automates the delivery, redemption, and reconciliation of issued public assistance benefits such as CalWORKs. EBT is also the method for distributing Cal Fresh benefits (formerly known as Food Stamps and currently known federally as Supplemental Nutrition Assistance Program (SNAP)). 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. In 2011, as part of its efforts to end child hunger, the United States Department of Agriculture's (USDA) Food and Nutrition Service (FNS) created the Summer Electronic Benefits Transfer for Children program to study the use of SNAP and Women, Infants, and Children (WIC) EBT technology by providing AB 2054 Page 4 children and their families with more resources to use at food stores during the summer months. In 2011, the USDA began "proof-of concept" demonstrations in two states, Michigan and Texas, for the WIC model, and in three states, Connecticut, Missouri, and Oregon, for the SNAP model. Each state provided benefits to 2,500 children in the summer of 2011. In 2012, each of the five proof-of-concept states increased operations to reach 5,000 children in new parts of their states. In addition to this, in 2012, five new states and Tribal Organizations implemented SEBTC projects: Cherokee Nation (WIC), Chickasaw Nation (WIC), Nevada (WIC), Delaware (SNAP), and Washington (SNAP). 3)Federal Budget. The President's FY 2017 proposed budget invests $12 billion over 10 years to create a permanent, universal Summer EBT program. Specifically, the proposal includes a $45 monthly benefit per child during the summer months for school-aged children eligible for free and reduced price meals through the National School Lunch Program (NSLP). The monthly benefit can be redeemed for food purchases at grocery stores and would be annually adjusted for inflation going forward. The program would be phased in over ten years with 10% of states participating by 2017 and serving almost one million low-income children. By 2026, when all states are expected to participate, nearly 20 million children will receive SEBTC benefits 4)Prior Legislation. AB 1542 (Ducheny), Chapter 270, Statutes of 1997, implemented federal welfare reform and established the CalWORKs program, and conformed to federal law in establishing the Electronic Benefits Transfer (EBT) Act. Analysis Prepared by:Jennifer Swenson / APPR. / (916) AB 2054 Page 5 319-2081