BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
324 (Beall)
Hearing Date: 8/27/2009 Amended: 8/24/2009
Consultant: Katie Johnson Policy Vote: Hum. Serv. 4-1
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BILL SUMMARY: AB 324 would require the California Department of
Aging to establish and annually update the Elder Economic
Security Standard Index, a tool that would quantify the basic
living costs of elders in California based on their counties of
residence.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
CDA EESSI implementation $30 $60 $60
Private
and annual calculation
CDA administration unknown, but potentially in the
hundredsGeneral/
Of thousands; eventually offset by
Private
private donations
Cost pressure on state unknown, but potentially in the
millionsGeneral/
means tested programs of dollars annually Federal
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STAFF COMMENTS: SUSPENSE FILE.
Existing law, the Mello-Granlund Older Californians Act,
establishes the California Department of Aging (CDA).
This bill would define the Elder Economic Security Standard
Index (EESSI) to mean an index that quantifies the costs that
elders face in meeting their basic needs, including, but not
limited to, food, shelter, health care, transportation,
utilities, and essential household items, in the private market.
The EESSI is derived by applying the methodology developed by
the Wider Opportunities for Women and Gerontology Institute to
publicly available data sources on the costs to live in each
county of the state.
This bill would redefine "greatest economic need" as the need
resulting from an income level at or below the thresholds
established by the EESSI. Under existing law, "greatest economic
need" is defined as the need resulting from an income level at
or below the poverty threshold established by the Bureau of the
Census.
This bill would require CDA to report the EESSI data for each
service are in its state plan as part of its mission as a
department.
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AB 324 (Beall)
Commencing in the 2010 calendar year, this bill would require
CDA to annually update the EESSI using the methodology developed
for the 2008 EESSI for each of California's 58 counties.
Utilizing the most recent demographic data available, this bill
would require CDA to annually calculate, beginning in 2010, the
number, percentage, and demographic profile of elders living
below the updated EESSI for that year.
Staff recommends that the bill be amended to specify an
implementation date instead of the ambiguous phrase "the 2010
calendar year".
This bill would require CDA to analyze the number and percentage
of elders living below the current EESSI for that year by
county, race, ethnicity, gender, age, housing, and other
relevant demographic factors. This bill would authorize CDA to
contract with the President of the University of California (UC)
for this purpose. If CDA were to contract with the UC to perform
the analysis, it would be an ongoing annual General Fund cost of
approximately $60,000. If CDA were to complete the analysis
in-house, it could cost approximately $85,000 in FY 2009-2010
and $100,000 - $150,000 ongoing in General Funds to provide for
research analysts, training in the EESSI and statistical
software, annually locating and gathering the most current
demographic and economic data within CA's counties, and annually
updating the EESSI.
This bill would require the 33 area agencies on aging (AAAs) to
annually update the Linkages Program intake form to include the
most current EESSI with the purpose of identifying elders in
economic need and to refer those elders to other resources and
programs. This bill would delete the existing requirement to
grant priority enrollment and services to low-income individuals
within the Linkages Programs.
According to an August 6, 2009, CDA Program Memo, among other
General Fund budget cuts, 9 months of funding for the Linkages
Program and 4 other programs was eliminated in FY 2009-2010, and
all funding was eliminated for FY 2010-2011. Although statutory
authority will continue to exist for Linkages, it is unknown
which AAAs will continue to operate the program.
Additionally, if an AAA chooses to close its Linkages Program,
it would be unreasonable for the AAA to annually update the
Linkages intake form, as required by this bill. Staff recommends
that the bill be amended to clarify that if an AAA chooses to
operate a Linkages Program, it would annually update the
program's intake form to include the most current EESSI.
This bill would provide that nothing in this act should be
construed to mandate changes in the current funding allocations
to AAAs. However, since this bill would connect more elders to
local resources and programs, there would be unknown, but
potentially significant, cost pressure on those programs to
accommodate the increased number of elders seeking services,
which could result in the need to expand the
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AB 324 (Beall)
services. AAAs administer various community-based programs
funded primarily by the General Fund and federal funds.
The August 24 amendments would request that the University of
California (UC) update the Elder Economic Security Standard
Index (EESSI) and provide it to the AAAs for purposes of
developing the area plan. They would permit CDA to accept
voluntary contributions to fund the UC's work to update the
EESSI and would require that any donations be deposited into the
continuously appropriated California Elder Economic Security
Standard Index Fund (EESSI Fund), which this bill would create
in the State Treasury. 5 percent of funds in the EESSI Fund
would be available for CDA's administrative costs and would
provide that any CDA start-up costs would be refunded by the
EESSI Fund. Staff recommends that the bill be amended to specify
that funds in the California Elder Economic Security Standard
Index Fund be available upon appropriation by the Legislature,
and not continuously appropriated, to ensure Legislative
oversight of the program. The amendments would prohibit the use
of state funds for purposes of updating the EESSI and would also
prohibit CDA from applying for grants or soliciting private
funds in order to pay for the update costs.
The amendments would provide that in the event the UC declines
to update the EESSI, AAAs would not be required to use the EESSI
in updating their area plans. The amendments would require the
Director of Finance to determine whether or not there are
sufficient moneys from private donations available in the EESSI
Fund for purposes of updating the EESSI each year an AAA's area
plan is updated. If the Director of Finance determines that
there are insufficient funds in the EESSI Fund, the fund would
cease to exist. If the EESSI fund ceases to exist, all
provisions in this bill related to the EESSI updates would be
repealed. The amendments would state that this bill should not
be construed, based on the use of the EESSI, to affect
means-tested programs administered through the Mello-Granlund
Older Californians Act. However, to the extent that the EESSI
data reveals that a significant number of elderly Californians
are below the EESSI, there would be pressure on the government
to change eligibility criteria for means-tested programs, such
as Medi-Cal, which provides health coverage to the aged, blind,
and disabled, among others, and increase access to assistance.