This measure would request the federal government to change federal policy in order to allow California to equitably end the Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.

This measure would request the federal government to change federal policy in order to allow California to equitably end the Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.

This measure would request the federal government to change federal policy in order to allow California to equitably end the Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.

This measure would request the federal government to change federal policy in order to allow California to equitably end the Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.

WHEREAS, The federal Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP; and

WHEREAS, SNAP, known as CalFresh in California, supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an electronic benefit transfer (EBT) card, analogous to a debit card, that can be used to purchase food; and

WHEREAS, SNAP benefits, which are available to most households living with incomes at, or below, 130 percent of the federal poverty level, are provided on a sliding scale based on income, household size, and certain household expenses; and

WHEREAS, The federal Supplemental Security Income (SSI) program provides income support to the elderly, blind, or disabled who meet income, resource, and other tests, and the State Supplementary Payment (SSP) program supplements SSI benefits; and

WHEREAS, The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out; and

WHEREAS, Californias cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose the option of cashing out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits; and

WHEREAS, By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP; and

WHEREAS, California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy; and

WHEREAS, In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible; and

WHEREAS, Californias SSI/SSP recipients are now living much closer to, or below, the federal poverty level than they were when the program began. In 1980, for example, an SSI/SSP benefit put a recipients income threshold at 128 percent of the federal poverty level. In 2016, an SSI/SSP benefit put a recipients income threshold at about 91 percent of the federal poverty level; and

WHEREAS, Over the years, Californias SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009; and

WHEREAS, SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks; and

WHEREAS, 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; and

WHEREAS, Californias cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals health and well-being; and

WHEREAS, Californias 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 for the household. 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; now, therefore, be it

Resolved by the Assembly and the Senate of the State of California, jointly, That the Legislature of the State of California 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy; and be it further

Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

WHEREAS, The federal Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP; and

WHEREAS, SNAP, known as CalFresh in California, supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an electronic benefit transfer (EBT) card, analogous to a debit card, that can be used to purchase food; and

WHEREAS, SNAP benefits, which are available to most households living with incomes at, or below, 130 percent of the federal poverty level, are provided on a sliding scale based on income, household size, and certain household expenses; and

WHEREAS, The federal Supplemental Security Income (SSI) program provides income support to the elderly, blind, or disabled who meet income, resource, and other tests, and the State Supplementary Payment (SSP) program supplements SSI benefits; and

WHEREAS, The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out; and

WHEREAS, Californias cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose the option of cashing out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits; and

WHEREAS, By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP; and

WHEREAS, California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy; and

WHEREAS, In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible; and

WHEREAS, Californias SSI/SSP recipients are now living much closer to, or below, the federal poverty level than they were when the program began. In 1980, for example, an SSI/SSP benefit put a recipients income threshold at 128 percent of the federal poverty level. In 2016, an SSI/SSP benefit put a recipients income threshold at about 91 percent of the federal poverty level; and

WHEREAS, Over the years, Californias SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009; and

WHEREAS, SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks; and

WHEREAS, 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; and

WHEREAS, Californias cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals health and well-being; and

WHEREAS, Californias 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 for the household. 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; now, therefore, be it

Resolved by the Assembly and the Senate of the State of California, jointly, That the Legislature of the State of California 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy; and be it further

Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

WHEREAS, The federal Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP; and

WHEREAS, SNAP, known as CalFresh in California, supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an electronic benefit transfer (EBT) card, analogous to a debit card, that can be used to purchase food; and

WHEREAS, SNAP benefits, which are available to most households living with incomes at, or below, 130 percent of the federal poverty level, are provided on a sliding scale based on income, household size, and certain household expenses; and

WHEREAS, The federal Supplemental Security Income (SSI) program provides income support to the elderly, blind, or disabled who meet income, resource, and other tests, and the State Supplementary Payment (SSP) program supplements SSI benefits; and

WHEREAS, The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out; and

WHEREAS, Californias cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose the option of cashing out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits; and

WHEREAS, By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP; and

WHEREAS, California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy; and

WHEREAS, In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible; and

WHEREAS, Californias SSI/SSP recipients are now living much closer to, or below, the federal poverty level than they were when the program began. In 1980, for example, an SSI/SSP benefit put a recipients income threshold at 128 percent of the federal poverty level. In 2016, an SSI/SSP benefit put a recipients income threshold at about 91 percent of the federal poverty level; and

WHEREAS, Over the years, Californias SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009; and

WHEREAS, SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks; and

WHEREAS, 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; and

WHEREAS, Californias cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals health and well-being; and

WHEREAS, Californias 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 for the household. 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; now, therefore, be it

Resolved by the Assembly and the Senate of the State of California, jointly, That the Legislature of the State of California 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy; and be it further

Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

WHEREAS, The federal Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP; and

WHEREAS, SNAP, known as CalFresh in California, supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an electronic benefit transfer (EBT) card, analogous to a debit card, that can be used to purchase food; and

WHEREAS, SNAP benefits, which are available to most households living with incomes at, or below, 130 percent of the federal poverty level, are provided on a sliding scale based on income, household size, and certain household expenses; and

WHEREAS, The federal Supplemental Security Income (SSI) program provides income support to the elderly, blind, or disabled who meet income, resource, and other tests, and the State Supplementary Payment (SSP) program supplements SSI benefits; and

WHEREAS, The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out; and

WHEREAS, Californias cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose the option of cashing out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits; and

WHEREAS, By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP; and

WHEREAS, California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy; and

WHEREAS, In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible; and

WHEREAS, Californias SSI/SSP recipients are now living much closer to, or below, the federal poverty level than they were when the program began. In 1980, for example, an SSI/SSP benefit put a recipients income threshold at 128 percent of the federal poverty level. In 2016, an SSI/SSP benefit put a recipients income threshold at about 91 percent of the federal poverty level; and

WHEREAS, Over the years, Californias SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009; and

WHEREAS, SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks; and

WHEREAS, 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; and

WHEREAS, Californias cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals health and well-being; and

WHEREAS, Californias 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 for the household. 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; now, therefore, be it

Resolved by the Assembly and the Senate of the State of California, jointly, That the Legislature of the State of California 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy; and be it further

Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

 CONSENT  

Bill No: AJR 35

Author:

:

Vote: 21

SENATE HUMAN SERVICES COMMITTEE: 5-0, 6/28/16

AYES: McGuire, Berryhill, Hancock, Liu, Nguyen

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 80-0, 6/1/16 - See last page for vote

SUBJECT:

SOURCE: Coalition of California Welfare Rights Organizations

DIGEST: This resolution requests the federal government to change its policy in order to allow California to equitably end the federal Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families.

ANALYSIS:

Existing federal law:

1. Establishes under federal law the SNAP program within the US Department of Agriculture to promote the general welfare and to safeguard the health and wellbeing of the nation’s population by raising the levels of nutrition among low-income households. It establishes SNAP eligibility requirements, including income that is at or below 130 percent of the Federal Poverty Level (FPL) and is a substantial limiting factor in permitting a recipient to obtain a more nutritious diet. (7 CFR 271.1; 7 CFR 273.9)
2. Establishes the national SSI program, which provides supplemental security income to individuals who have attained age 65 or are blind or disabled and requires that the income and resources of certain SSI recipients shall not be considered in determining eligibility or level of benefits of the household, as specified. (42 U.S.C. 1381 et. seq.) (7 CFR § 273.20 (c))
3. 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))

Existing state law:

1. Establishes California’s CalFresh program to administer federal SNAP benefits to families and individuals that meet specified criteria. (WIC 18900 et seq.)
2. Establishes the SSP, which supplements federal SSI payments in order to provide persons who are aged, blind or disabled with assistance and services that help them meet basic needs and maintain or increase independence. (WIC 12000 et seq.)
3. Provides that eligibility requirements for state SSP match federal SSI criteria, and requires a minimum level of SSP benefits be provided in order to maintain federal Medicaid funding, as specified. (WIC 12000 et seq.)
4. Requires annual adjustments, based on the California Necessities Index (CNI), as defined, to SSI/SSP payment schedules to reflect increases or decreases in the cost of living, as specified. Further stipulates that such adjustments shall not be made, unless otherwise required by statute for the 2011 calendar year and each year thereafter. (WIC 12201)

This resolution:

1. Makes a series of legislative findings and resolutions regarding the effects of California’s cash-out policy for SNAP benefits, which makes SSI/SSP recipients ineligible for SNAP, including:
2. The federal SNAP offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP.
3. CalFresh supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an EBT card, analogous to a debit card that can be used to purchase food.
4. SNAP benefits, which are available to most households living with incomes at or below 130 percent of the FPL, are provided on a sliding scale based on household income, size and expenses.
5. The federal SSI program provides income support to elderly, blind, or disabled individuals who meet income, resource, and other tests, and the SSP program supplements SSI benefits.
6. The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out.
7. California’s cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose to cash out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits.
8. By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP.
9. California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy.
10. In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible.
11. California’s SSI/SSP recipients are now living much closer to, or below, the FPL than they were when the program began.
12. Over the years, California’s SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009.
13. SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks.
14. California’s cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals’ health and well-being.
15. 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 for the household. 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.
16. Resolves that the 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.
17. Resolves that the Chief Clerk of the Assembly transmit copies of the resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

Background

California is the only state in which SSI/SSP recipients are ineligible for CalFresh benefits because of the “cash-out” policy. AJR 35 urges the federal government to change policy to allow California to equitably end the SNAP cash-out policy in a way that would maximize benefits to, and participation among seniors, and mitigate or eliminate harm to low income families and medically needy children.

The SSI/SSP program provides a monthly cash benefit to qualified individuals and couples in order to help them pay for basic living expenses, such as food, clothing and shelter. In order to be eligible, a person must be at least 65 years-old, blind or disabled (including disabled children) and meet income and resource requirements. A qualified SSI recipient is automatically qualified for SSP. SSI is a federally funded benefit; the SSP benefit is funded with the state’s General Fund and California sets SSP rates. The SSI/SSP caseload for FY 2016-17 is 1.31 million.

The federal Social Security Administration provides an annual Cost of Living adjustment (COLA) to the SSI which is based on the Consumer Price Index. While the federal government has regularly increased its SSI contribution since 2011, the state has frozen or decreased its SSP contribution in recent years. Specifically, the state-funded COLAs for SSP were suspended periodically throughout as a cost-savings strategy during the Great Recession.

The current SSI/SSP maximum grant levels are $889.40 per month for an individual and $1,496 per month for couples, which places individuals at 90 percent the FPL and couples at 112 percent of the FPL. SSI/SSP maximum payment for individuals was as high as $907 in January 2009 (before the recession) and decreased to a low of $830.40 in June 2011. The state’s SSP contribution was at its lowest level in June 2011 at $156.40 and has not increased since then. The SSP COLA was permanently repealed in 2009.

AB 1603 (Committee on Budget, Chapter 25, Statutes of 2016), which enacts the human services budget for Fiscal Year 2016-17, includes a one-time increase to the SSP beginning January 1, 2017. This will give individuals an increase of $4.32 and couples an increase of $10.94 per month. As of January 1, 2017, SSI/SSP for an individual will be $893.72, couples will receive $1,107.14. With this increase, SSI/SSP benefit level still falls short of its highest level of $907 for individuals and $1,579 for couples, which was in place in January 2009.

Cash-out policy

California’s cash-out policy started in 1974 when the federal government began the combined SSI/SSP program in order to complement various state programs supporting the blind, elderly, and disabled populations. At that time, California chose to provide SSI/SSP recipients with a $10 cash benefit instead of a $10 food-stamp benefit. California chose the option of cashing out SNAP benefits, which was approximately $10 per month in California at the time, for SSI/SSP recipients due to the high administrative costs of delivering the $10 food-stamp benefit.

By combining the SNAP benefits into the SSI/SSP payment, SSI/SSP recipients were made ineligible for SNAP. However, in a “mixed” household, in which some members receive SSI benefits and other members do not, the SSI/SSP income is disregarded when determining the household’s CalFresh eligibility and level of benefits, making these households potentially eligible for SNAP benefits. For example, if a disabled child receives SSI/SSP and his or her household applies for CalFresh, the SSI/SSP income of this child doesn’t count toward the family’s CalFresh benefit calculation. In this case, the entire household receives higher overall benefits than it would have otherwise.

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. They would continue to receive SSI/SSP and, if they apply for CalFresh, they could receive at least $16 per month increased benefits. On the other hand, mixed households could see their nutrition assistance reduced or eliminated if the SSI/SSP income is counted for purposes of determining household CalFresh eligibility and benefit levels.

In 2010, California requested to waive the federal requirement to treat the state’s SSI/SSP population uniformly. The waiver would have permitted California to maintain the cash-out for mixed SSI/SSP households, while ending cash-out for SSI/SSP-only households. The waiver was rejected because the USDA did not believe the agency had authority to end cash-out for some, but not all, households.

Related legislation

AB 1584 (Brown, 2016) reinstates the COLA for SSP for aged, blind and disabled individuals and indexes the maximum SSI/SSP benefit to the FPL.

AB 1603 (Assembly Committee on Budget, Chapter 25, Statutes of 2016) enacted the human services budget for FY 2016-17 and includes a one-time increase to the SSP (calculated at 2.76% of CNI) beginning January 1, 2017.

FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Local: No

According to an analysis prepared by the Assembly Appropriations Committee, there would be ongoing costs of approximately $135 million (federal funds) for increased CalFresh benefits to the approximately one million individuals who would become eligible for CalFresh benefits by the elimination of the cash-out policy. There would also be unknown potential savings to the state due to a reduction in SSP benefits to 1.3 million SSI/SSP recipients. Additionally, the analysis identified unknown costs/savings (federal funds) associated with the approximately 300,000 SSI/SSP recipients in mixed households where there would be a simultaneous gain in eligibility and potential loss of CalFresh benefits within the household due to the loss of the SSI/SSP income disregard.

SUPPORT: (Verified 8/2/16)

Coalition of California Welfare Rights Organizations (source)

California Alliance for Retired Americans

California Association of Public Authorities

Mercy Brown Bag Program

Personal Assistance Services Council of Los Angeles County

Resources for Independent Living

San Francisco Senior and Disability Action

St. Mary’s Center

OPPOSITION: (Verified 8/2/16)

None received

ARGUMENTS IN SUPPORT: According to the author, after decades of budget and fiscal changes, the $10 cash-out policy for SSI/SSP recipients is causing them to live much closer to, or below, the FPL than when the program began in 1974. For example, in 1980, an SSI/SSP grant put a recipient at 128% of FPL. In 2016, the SSI/SSP grant puts a recipient about 91% of the federal poverty level, the author states. In California, SSI/SSP recipients are ineligible for CalFresh benefits because of the cash-out policy. Yet, ending the cash-out policy without changing federal policy would reduce benefits for approximately 58,000 medically dependent children, per the author.

ASSEMBLY FLOOR: 80-0, 6/1/16

AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon

Prepared by:

8/3/16 18:36:28

**** END ****

SENATE COMMITTEE ON HUMAN SERVICES

Senator McGuire, Chair

2015 - 2016 Regular

Bill No: AJR 35

Subject: Supplemental Nutrition Assistance Program: cash-out policy

SUMMARY

This joint resolution requests the federal government to change its policy in order to allow California to equitably end the federal Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the Supplemental Security Income (SSI) and the State Supplementary Payment (SSP) programs, in a way that would maximize benefits to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families.

ABSTRACT

Existing law:

1. Establishes under federal law the Supplemental Nutrition Assistance Program (SNAP) within the US Department of Agriculture (USDA) to promote the general welfare and to safeguard the health and wellbeing of the nation’s population by raising the levels of nutrition among low-income households. It establishes SNAP eligibility requirements, including income that is at or below 130 percent of the federal poverty level and is a substantial limiting factor in permitting a recipient to obtain a more nutritious diet. (7

CFR 271.1; 7 CFR 273.9)

1. Establishes in California statute the CalFresh program to administer the provisions of federal SNAP benefits to families and individuals meeting specified criteria. (WIC 18900 et seq.)
2. Establishes in the Electronic Benefits Transfer (EBT) Act a system for the distribution and use of public assistance benefits, such as CalFresh, and requires EBT access to be provided through automated teller machines (ATMs), point-of-sale devices and other devices that accept EBT transactions. (WIC 10065 et seq.)
3. Establishes in California law the SSP, which supplements federal SSI payments in order to provide persons who are aged, blind or disabled 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 state SSP match federal SSI criteria, and requires a minimum level of SSP benefits be provided in order to maintain federal Medicaid funding, as specified. (WIC 12000 et seq.)
5. Defines the California Necessities Index (CNI) to be the weighted average of changes for food, clothing, fuel, utilities, rent, and transportation for low-income consumers, and specifies the methods of computing annual adjustments to the CNI. (WIC 12201)
6. Requires annual adjustments, based on the CNI, to SSI/SSP payment schedules to reflect increases or decreases in the cost of living, as specified, but further stipulates that such adjustments shall not be made, unless otherwise required by statute, for the 2011 calendar year and each calendar year thereafter. (WIC 12201)
7. Establishes in federal law the national SSI program, which provides supplemental security income to individuals who have attained age 65 or are blind or disabled. (42 U.S.C. 1381 et. seq.))
8. 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))
9. Requires that the income and resources of certain defined SSI recipients living in a household shall not be considered in determining eligibility or level of benefits of the household, as specified. (7 CFR § 273.20 (c))

This resolution:

1. Makes a series of legislative findings and resolutions regarding the effects of California’s cash-out policy for SNAP benefits, which makes SSI/SSP recipients ineligible for SNAP, as follows:
2. The federal SNAP offers nutrition assistance to millions of eligible, low-income individuals and families and provides economic benefits to communities. Nevertheless, many low-income seniors and people with disabilities in California, who have difficulties obtaining sufficient food, cannot receive assistance through SNAP.
3. SNAP, known as CalFresh in California, supports millions of low-income Californians who meet income, resource, and other tests. This program provides monthly benefits through an EBT card, analogous to a debit card that can be used to purchase food.
4. SNAP benefits, which are available to most households living with incomes at, or below, 130 percent of the FPL, are provided on a sliding scale based on income, household size, and certain household expenses.
5. The federal SSI program provides income support to the elderly, blind, or disabled who meet income, resource, and other tests, and the SSP program supplements SSI benefits.
6. The estimated average in supplemental nutrition assistance for an SSI/SSP recipient is $135 per month, but 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to a policy known as cash-out.
7. California’s cash-out policy was established in 1974, when the federal government began the combined federal-state SSI/SSP program. Under the cash-out policy, California chose the option of cashing out SNAP benefits to SSI/SSP recipients by including the estimated value of SNAP benefits, approximately $10 per month in California as set in 1974, within SSI/SSP benefits.
8. By adding the $10 amount into existing SSI/SSP payments, California reduced state administrative and other expenditures associated with the high costs of delivering a small amount of CalFresh benefits to each SSI/SSP recipient on a monthly basis. The incorporation of the SNAP benefit into the SSI/SSP payment prevented SSI/SSP recipients in California from being eligible for SNAP.
9. California is the only state in which SSI/SSP recipients are ineligible for SNAP under this policy.
10. In 1974, many elderly, blind, or disabled SSI/SSP participants were only eligible for minimal SNAP benefit amounts, and the combined SSI and SSP income received by participants was high enough that it limited the amount of SNAP benefits for which SSI/SSP recipients were eligible.
11. California’s SSI/SSP recipients are now living much closer to, or below, the FPL than they were when the program began. In 1980, for example, an SSI/SSP benefit put a recipient’s income threshold at 128% of the FPL. In 2016, an SSI/SSP benefit put a recipient’s income threshold at about 91% of the FPL.
12. Over the years, California’s SSI/SSP benefits have risen and fallen, and the annual, automatic cost-of-living adjustment (COLA) for SSI/SSP was repealed in California in 2009.
13. SSI/SSP recipients in California, on average, would be eligible for far more CalFresh benefits today than the $10 monthly amount that they have been receiving since 1974 as food assistance in their SSI/SSP checks.
14. 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.
15. California’s cash-out policy hurts many low-income seniors and people with disabilities. Continuing the cash-out policy at this time poses many significant risks to these individuals’ health and well-being.
16. 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 for the household. 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.
17. Resolves that the 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 to, and participation among, newly eligible individuals and mitigate or eliminate harm to low-income families and the approximately 60,000 medically needy children who could be made ineligible for certain benefits under a program without the cash-out policy.
18. Resolves that the Chief Clerk of the Assembly transmit copies of the resolution to the President and Vice President of the United States, to the Speaker of the House of Representatives, to the Majority Leader of the Senate, to each Senator and Representative from California in the Congress of the United States, and to the author for appropriate distribution.

FISCAL IMPACT

According to an analysis prepared by the Assembly Appropriations Committee, there would be ongoing costs of approximately $135 million (federal funds) for increased CalFresh benefits to the approximately one million individuals who would become eligible for CalFresh benefits by the elimination of the cash-out policy. There would also be unknown potential savings to the state due to a reduction in SSP benefits to 1.3 million SSI/SSP recipients. Additionally, unknown costs/savings (federal funds) associated with the approximately 300,000 SSI/SSP recipients in mixed households where there would be a simultaneous gain in eligibility and potential loss of CalFresh benefits within the household due to the loss of the SSI/SSP income disregard.

BACKGROUND AND DISCUSSION

Purpose of the bill:

According to the author, after decades of budget and fiscal changes, the $10 cash-out policy for SSI/SSP recipients is causing them to live much closer to, or below, the federal poverty level (FPL) than when the program began in 1974. For example, in 1980, an SSI/SSP grant put a recipient at 128% of FPL. In 2016, the SSI/SSP grant puts a recipient about 91% of the federal poverty level, the author states.

In California, SSI/SSP recipients are ineligible for CalFresh benefits because of the “cash-out” policy. California is the only state in which SSI/SSP recipients are ineligible for these benefits. Unfortunately, ending the cash-out without changing federal policy would reduce benefits for approximately 60,000 medically dependent children, per the author.

AJR 35 urges 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 to, and participation among seniors, and mitigate or eliminate harm to low income families and medically needy children.

Poverty

According to the FPL, an individual must earn at least $981 per month to make ends meet, and avoid "poverty." In 2013, the US Census Bureau issued a report^[1] that indicates that nearly 25 percent of California’s 38 million residents (8.9 million) were living in poverty. Using a slightly different methodology, the Public Policy Institute of California (PPIC) issued a report^[2] that placed the statewide poverty rate at 22 percent. The same PPIC report indicates that 19 percent of adults over 65 years of age were living in poverty. According to PPIC, some of the highest poverty rates were in the San Francisco Bay Area and coastal communities. At 27 percent, Los Angeles had the highest poverty rate in the state, followed by Napa at 25.5 percent.

In a March 2015 Joint Hearing of the Assembly Committee on Aging and Long Term Care and the Assembly Committee on Human Services titled Who Can Afford to Get Old? Senior Poverty in the Golden State, numerous aged individuals and individuals with disabilities provided public comment about the financial hardship they and people they know were facing due, in part, to the low SSI/SSP grant amount.

The California Elder Economic Security Index (EESI) measures the minimum income necessary to cover basic expenses for people age 65 years and older in each of California’s counties. The EESI factors in housing, food, health care, and transportation costs. According to the EESI, a single renter living alone in a one-bedroom apartment in Kern County needs $1,565 per month to pay for basic expenses, which increases to $2,193 needed for a couple renting that same apartment.

SSI/SSP

The SSI/SSP program provides a monthly cash benefit to qualified individuals and couples in order to help them pay for basic living expenses, such as food, clothing and shelter. In order to be eligible for SSI/SSP, a person must be at least 65 years-old, blind or disabled (including disabled children) and meet certain income and resource requirements. A qualified SSI recipient is automatically qualified for SSP. SSI is a federally funded benefit. The SSP benefit is funded with the state’s General Fund and California sets its own SSP rates. The estimated SSI/SSP caseload for FY 2016-17 is 1.31 million cases. The current SSI/SSP maximum grant levels are $889.40 per month for an individual and $1,496 per month for couples, which places individuals at 90 percent of poverty and couples at 112 percent of FPL.

Changes in SSI/SSP Benefits

The federal Social Security Administration (SSA) provides an annual COLA to the SSI which is based on the Consumer Price Index. While the federal government has regularly increased its SSI contribution since 2011, the state has frozen or decreased its SSP contribution in recent years. Specifically, the state-funded COLAs for SSP was suspended periodically throughout the 1990s and into the 2000s as a cost-savings strategy during the Great Recession.

SSI/SSP maximum payments were as high as $907 in January 2009 (before the recession) and decreased to a low of $830.40 in June 2011. The state’s SSP contribution was at its lowest level in June 2011 at $156.40 and has not increased since then. The SSP COLA was permanently repealed in 2009 through statute.

AB 1603, which enacts the human services budget for Fiscal Year 2016-17, includes a one-time increase to the SSP (calculated at 2.76% of CNI) beginning January 1, 2017. This will give individuals an increase of $4.32 and couples an increase of $10.94 per month. As of January 1, 2017, SSI/SSP for an individual will be $893.72, couples will receive $1,107.14. With this increase, SSI/SSP benefit level still falls short of its highest level of $907 for individuals and $1,579 for couples, which was in place in January 2009.

Cash-out policy

California’s cash-out policy started in 1974 when the federal government began the combined SSI/SSP program in order to complement various state programs supporting the blind, elderly, and disabled populations. At that time, California chose to provide SSI/SSP recipients with a $10 cash benefit instead of a $10 food-stamp benefit. California chose the option of cashing out SNAP benefits, which was approximately $10 per month in California at the time, for SSI/SSP recipients due to the high administrative costs of delivering the $10 food-stamp benefit. Since 1974, the minimum CalFresh benefit has increased from $10 to about $16. Therefore, if the cash-out policy were terminated, some SSI/SSP recipients would be eligible for a CalFresh benefit of at least $16.

By combining the SNAP benefits into the SSI/SSP payment, SSI/SSP recipients were made ineligible for SNAP. However, in a “mixed” household, in which some members receive SSI benefits and other members do not, the SSI/SSP income is disregarded when determining the household’s CalFresh eligibility and level of benefits, making these households potentially eligible for SNAP benefits. For example, if a disabled child receives SSI/SSP and his or her household applies for CalFresh, the SSI/SSP income of this child doesn’t count toward the family’s CalFresh benefit calculation. In this case, the entire household receives higher overall benefits than it would have otherwise.

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. They would continue to receive SSI/SSP and, if they apply for CalFresh, they could receive at least $16 increase in benefits. On the other hand, mixed households could see their nutrition assistance reduced or eliminated if the SSI/SSP income is counted for purposes of determining household CalFresh eligibility and benefit levels.

Past efforts to change cash-out implementation

In 2010, California applied for a federal waiver that would have allowed California to treat the state’s SSI/SSP population uniformly. The waiver would have permitted California to maintain the cash-out for mixed SSI/SSP households, while ending cash-out for SSI/SSP-only households. If the waiver had been approved, the SSI/SSP income for mixed-SSI/SSP households would not count when determining the household CalFresh benefit. Additionally, SSI/SSP-only households would have been eligible for CalFresh. The waiver was rejected because the U.S. Department of Agriculture did not believe the agency has the authority to end cash-out for some, but not all, households.

Related legislation:

AB 1584 (Brown, 2016) reinstates the COLA for SSP for the aged, blind and disabled and indexes the maximum SSI/SSP benefit to the FPL.

AB 1603 (Assembly Committee on Budget, 2016) enacts the human services budget for Fiscal Year 2016-17 and includes a one-time increase to the SSP (calculated at 2.76% of CNI) beginning January 1, 2017.

PRIOR VOTES

POSITIONS

Support:

Coalition of California Welfare Rights Organizations (Sponsor)

California Alliance for Retired Americans

California Association of Public Authorities

Mercy Brown Bag Program

Resources for Independent Living

San Francisco Senior and Disability Action

St. Mary’s Center

The Personal Assistance Services Council of Los Angeles County

Oppose:

None.

-- END --

1. http://www.census.gov/content/dam/Census/library/publications/2014/demo/p60-251.pdf?eml=gd&utm_medium=email&utm_source=govdelivery ↑

2. http://www.ppic.org/content/pubs/report/R_1013SBR.pdf ↑

ASSEMBLY THIRD READING

ATR Bill Id:AJR 35

Author:(Brown)

As Introduced Ver:March 17, 2016

Majority vote

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:
   1. 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;
   2. 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;
   3. SNAP benefits are provided on a sliding scale based on income, household size, and certain household expenses;
   4. 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);
   5. 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to the cash-out policy;
   6. 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;
   7. California is the only state in which SSI/SSP recipients are ineligible for SNAP under the cash-out policy;
   8. California's SSI/SSP recipients currently live closer to, or below, the federal poverty level (FPL) than when the program began;
   9. 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;
   10. SSI/SSP recipients in California would, on average, be eligible for more CalFresh benefits than the $10 monthly amount;
   11. 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;
   12. 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
   13. 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 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. (Welfare and Institutions Code Section (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 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 Code of Federal Regulations Section (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: According to the Assembly Appropriations Committee, this bill may result in the following costs and savings:

1. Ongoing costs of approximately $135 million (federal funds) for increased CalFresh benefits to the approximately one million individuals who would become eligible for CalFresh benefits by the elimination of the cash-out policy;
2. Unknown potential savings to the State due to a reduction in SSP benefits to 1.3 million SSI/SSP recipients; and
3. Unknown costs/savings (federal funds) associated with the approximately 300,000 SSI/SSP recipients in mixed households where there would be a simultaneous gain in eligibility and potential loss of CalFresh benefits within the household due to the loss of the SSI/SSP income disregard.

COMMENTS:

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 SSA applies an annual cost of living adjustment (COLA) to the SSI portion of the grant 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 proposed Budget includes a cost-of-living increase to the SSP beginning January 1, 2017, that is equal to the California Necessities Index (CNI), currently estimated to be 2.76%.

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 (SNAP, formerly known as food stamps) 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 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-1970s, 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."

Analysis Prepared by: Daphne Hunt / HUM. S. / (916) 319-2089 FN: 0003238

Date of Hearing: May 18, 2016

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez, Chair

ABPCA Bill Id:AJR 35

Author:(Brown) – As Introduced Ver:March 17, 2016

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This measure requests the federal government to change its policy in order to allow California to equitably end the Supplemental Nutrition Assistance Program (SNAP) cash-out policy, administered through the SSI/SSP programs, in such a way as to maximize benefits and participation while at the same time mitigating or eliminating harm to low income families and approximately 60,000 medically needy children who would otherwise lose benefits.

FISCAL EFFECT:

1. Ongoing costs of approximately $135 million (federal funds) for increased CalFresh benefits to the approximately one million individuals who would become eligible for CalFresh benefits by the elimination of the cash-out policy.
2. Unknown potential savings to the State due to a reduction in SSP benefits to 1.3 million SSI/SSP recipients.
3. Unknown costs/savings (federal funds) associated with the approximately 300,000 SSI/SSP recipients in mixed households where there would be a simultaneous gain in eligibility and potential loss of CalFresh benefits within the household due to the loss of the SSI/SSP income disregard.

COMMENTS:

1. Purpose. According to the author, “The Federal 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. 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.”
2. Background. California’s cash-out policy started in 1974 when the federal government began the combined SSI/SSP program. At that time, states were allowed to increase their SSP instead of administering food stamps to SSI/SSP recipients. California opted for the "cash-out" policy which 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. However, this tradeoff also prevented SSI/SSP recipients in California from being eligible for SNAP. California remains the only state with a cash-out policy still in place.

Over time, the criteria for maintaining the cash-out program have changed. Instead of the inclusion of a discrete, or "extra" $10 for food purchases in the SSP, California's cash-out policy is now based on the state's implementation of federal cost-of-living adjustments (COLA) to the federal SSI benefit. Passing through the federal COLA to SSI/SSP recipients in California 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.

1. Tradeoffs. Today, 1.3 million SSI/SSP recipients in California are ineligible for SNAP (CalFresh) due to the cash-out policy. About 80% of these SSI/SSP recipients in California (primarily live-alone seniors) would, on average, be eligible for more CalFresh benefits than the $10 monthly bump they receive in SSP. They would see a net benefit from California's elimination of the cash-out policy because they stand to gain higher levels of food assistance by becoming eligible for CalFresh.

However, at the same time, maintaining the cash-out policy has direct benefits for families where only one person or a portion of the household receives SSI/SSP (usually a disabled adult or child, or elderly household member) but the rest of the family is eligible for CalFresh or other benefits. This is because in these “mixed” households the SSI/SSP income is not counted when determining the household’s CalFresh eligibility and level of benefits. These households could see their nutrition assistance reduced or eliminated if the SSI/SSP income is now counted for purposes of determining 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.

1. Past Efforts. In the early 1990's, USDA rejected two separate proposals from California to end cash-out without taking benefits sway from "mixed-status" households – i.e. households in which some members receive SSI/SSP and some do not. USDA raised both policy and legal questions regarding the suggested approaches.

This resolution 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 avoids harm to families that would lose benefits from should the cash-out policy end.

Analysis Prepared by: Jennifer Swenson / APPR. / (916) 319-2081

Date of Hearing: April 26, 2016

ASSEMBLY COMMITTEE ON HUMAN SERVICES

Susan Bonilla, Chair

ABPCA Bill Id:AJR 35 (

Author:Brown) – As Introduced Ver: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:
   1. 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;
   2. 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;
   3. SNAP benefits are provided on a sliding scale based on income, household size, and certain household expenses;
   4. 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);
   5. 1.3 million SSI/SSP recipients in California are ineligible for SNAP due to the cash-out policy;
   6. 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;
   7. California is the only state in which SSI/SSP recipients are ineligible for SNAP under the cash-out policy;
   8. California’s SSI/SSP recipients currently live closer to, or below, the federal poverty level (FPL) than when the program began;
   9. 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;
   10. SSI/SSP recipients in California would, on average, be eligible for more CalFresh benefits than the $10 monthly amount;
   11. 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;
   12. 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
   13. 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 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 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 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 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 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

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