Lost Dollars, Empty Plates

Transcription

1 Lost Dollars, Empty Plates The Impact of CalFresh Participation on State and Local Economies Tia Shimada February 2013

2 California Food Policy Advocates (CFPA) is a statewide public policy and advocacy organization dedicated to improving the health and well being of low income Californians by increasing their access to nutritious, affordable food. For more information about this report, please contact Tia Shimada at tia@cfpa.net or ext For more information about other aspects of CFPA s work on CalFresh, please contact Kerry Birnbach at kerry@cfpa.net or ext For more information about CFPA, please visit

3 Acknowledgments CFPA s efforts to improve CalFresh are supported by The California Endowment, The California Wellness Foundation, First 5 LA, Kaiser Permanente Community Benefit, and MAZON: A Jewish Response to Hunger. Their generous support is gratefully acknowledged.

4 Table of Contents Introduction... 2 CalFresh Overview... 2 Impact on State and Local Economies... 3 Impact on State and Local Budgets... 3 Underutilization of CalFresh Means Lost Dollars for All... 3 Analysis... 4 The Lost Dollars... 4 Improving CalFresh Participation... 5 County Data Tables... 8 Table Table Table Methodology Table Table Table Appendix A: Alternate Analysis Table Table Table Appendix B: Alternate Analysis Methodology Table Table Table References Last Updated

5 Introduction According to the U.S. Department of Agriculture (USDA), California ranks last among all states for participation in the Supplemental Nutrition Assistance Program (SNAP). 1 The low rate of participation harms state and local economies as well as low-income Californians. The following analysis examines the impact that increased participation in CalFresh, known federally as SNAP, would have on state, local, and household budgets. In these times of ongoing economic hardship, ensuring that CalFresh reaches all eligible individuals and families is an excellent means of bolstering economic activity while supporting the growing number of Californians in need. CalFresh Overview CalFresh/SNAP is the nation s largest source of nutrition assistance. CalFresh provides benefits to supplement household food budgets when individuals and families cannot afford enough to eat. By providing access to a nutritious, affordable diet, CalFresh benefits support productivity, promote health, and help prevent hunger. CalFresh benefits are fully federally funded. The federal government also funds 50 percent of CalFresh administrative costs, with the state and counties contributing the remaining 35 and 15 percent, 2 respectively. CalFresh has federal entitlement status which means that federal funding must be made available to provide all eligible applicants with benefits. The most recently available data from USDA show that 55 percent of all eligible individuals participated in CalFresh during fiscal year (FY) CalFresh enrollment has increased rapidly in recent years. For example, the number of Californians participating in CalFresh increased by approximately 21 percent from FY 2009 to FY As shown in Figure 1, this increase in participation has not met the growing need for nutrition assistance. As of November 2012, over 4.1 million Californians participate in CalFresh. 4 This translates to more than $612 million 5 in monthly nutrition assistance benefits for eligible children, adults, and seniors. Households received an average of $332 in monthly CalFresh benefits during FY

6 6,000,000 Figure 1. CalFresh Participation and Eligibility FY ,000,000 4,000,000 3,000,000 2,000,000 1,000, Individual Participants Eligible Individuals Sources: USDA Annual State Level Data - Persons Participating (FY and FY ), available at: USDA State Activity Reports (FY 2006 edition), available at: USDA Reaching Those In Need: State Supplemental Nutrition Assistance Participation Rates ( editions), available at: Impact on State and Local Economies CalFresh benefits support households by increasing their ability to purchase adequate amounts of nutritious food. But CalFresh benefits do more than help individual Californians. USDA has shown that every dollar in SNAP expenditures generates $1.79 in economic activity. 7 In addition to helping households meet their nutritional needs, CalFresh benefits exert a multiplier effect that stimulates the economy. Impact on State and Local Budgets The California Legislative Analyst s Office (LAO) asserts that CalFresh benefits help generate revenue for the state and local governments. 8 Receiving CalFresh benefits can allow households to redistribute income that would normally be allocated to purchasing food. A portion of this redistributed income can be spent on taxable goods, which generates sales tax revenue for the state and counties. This revenue-generating effect occurs soon after CalFresh benefits are issued, as eligible households are, by necessity, more likely to spend (rather than save) any additional income within weeks of its being received. 9 Underutilization of CalFresh Means Lost Dollars for All Underutilization of CalFresh means less for all Californians less nutrition assistance for eligible households, less economic activity, and less sales tax revenue for the state and local governments. 3

7 Fortunately, in recent years California has made great strides to increase CalFresh access and participation. For instance, California simplified out-of-office CalFresh enrollment. Customers (i.e., CalFresh applicants and clients) can now opt for a telephone interview and have greater access to online services, including online applications. In addition, customers are no longer required to provide a finger image (electronic fingerprints) in order to be deemed eligible for benefits. All of these improvements help ensure that customers are not unnecessarily burdened with multiple trips to local CalFresh offices. In October 2013, California will implement the Heat and Eat Initiative and transition to semi-annual reporting. These changes will further simplify paperwork requirements for customers and administrators. As described in the following section, more work remains to improve CalFresh participation. Analysis The Lost Dollars If CalFresh reached 100 percent a of all eligible individuals, California would receive an estimated $4.7 billion in additional federal nutrition benefits each year. Those benefits would generate an estimated $8.3 billion in additional economic activity per year. (See Appendix A for details.) Statewide Snapshot Eligible Non-Participants 3.4 million Lost Federal Dollars (Benefits) $4.7 billion Lost Economic Activity $8.3 billion Lost State Tax Revenue (GF) $83 million Lost County Tax Revenue $38 million By applying CalFresh benefits to their household food costs, CalFresh participants may have more dollars to spend on taxable goods. Using a methodology adopted from the California Legislative Analyst s Office, CFPA calculates that these dollars would result in an estimated $83 million of additional sales tax revenue for the state general fund (GF). Similarly, CalFresh participation among all eligible individuals would generate an estimated $38 million for county budgets through additional state and county sales tax. a An estimated 100 percent of eligible individuals receive SNAP benefits in Maine and Oregon. In Vermont, Washing, Michigan, and Tennessee an estimated 98, 97, 95, and 92 percent of eligible individuals, respectively, receive SNAP benefits. Seventeen additional states have estimated SNAP participation rates at or above 80 percent. Source: USDA, Reaching Those in Need: State Food Stamp Participation Rates in

8 Improving CalFresh Participation As this report demonstrates, low CalFresh participation results in fewer federal dollars for California, hampers economic activity, and leaves low-income Californians without adequate access to food. Although CalFresh participation experienced unprecedented growth during the economic recession, only 55 percent of eligible individuals receive benefits. Increasing CalFresh participation requires changes in policy and practice at the state and local levels. More broadly, it requires a shift in public perception and an evolution of the way we do business within CalFresh administration. The following recommendations articulate a vision and strategies to improve CalFresh participation. Develop a Statewide Vision Some California counties have developed innovative and efficient ways to administer CalFresh that draw on customer service-centered models from the business sector. Those innovations should be considered in the development of a streamlined, statewide vision of service. Statewide leadership is necessary to establish that vision and ensure implementation. All Doors Lead to CalFresh Healthcare Reform - California is preparing for the 2014 implementation of the Affordable Care Act (ACA). New web portals and services are being developed to enroll eligible Californians in healthcare coverage through a state exchange (recently named Covered California). ACA implementation will make two million 10 Californians newly eligible for Medi-Cal. To ensure that low-income Californians receive optimal support from these new systems and technologies, Californians should be able to connect with additional services and programs, such as CalFresh, after enrolling in healthcare coverage. Using customer information and eligibility status from one set of programs (like healthcare coverage accessed via CA Covered) to simplify enrollment and connections with respect to additional services (like CalFresh) is known as horizontal integration. Healthcare Settings - As a form of nutrition assistance, CalFresh plays a vital role in supporting overall health and wellbeing. Consequently, staff in healthcare settings (e.g., hospitals, clinics) should have a simple way of referring patients to CalFresh. Some hospitals and clinics in California are exploring ways to screen patients for food insecurity and connect them to necessary resources. These models should be evaluated, and if effective, replicated throughout the state. 5

9 Streamline CalFresh Enrollment & Administration AB 191 (Bocanegra): Strengthening the Connection Between Medi-Cal & CalFresh - A significant number of individuals who receive Medi-Cal are unaware that their households may be eligible for CalFresh. In addition, some households that include a Medi-Cal recipient may be net-income eligible for CalFresh, but have a gross income above the current limit. This means that because of the CalFresh gross income test, otherwise eligible households that have high need and high expenses (like child care) may be prevented from accessing CalFresh benefits. AB 191 proposes to make households that include a Medi-Cal recipient and have incomes up to 200 percent of the federal poverty level (FPL) categorically eligible for CalFresh. The gross income limit would be raised from the current limit of 130 percent of FPL to 200 percent of FPL for categorically eligible households that include a Medi- Cal recipient. The net income test would still apply to these households. The changes proposed by AB 191 would strengthen the link between CalFresh and Medi-Cal in an effort to provide a more comprehensive package of benefits to Californians in need. Leverage Technology for Administrative Efficiency, In-reach, and Outreach Requiring low-income households to provide their personal information multiple times in order to receive assistance is unnecessary and inefficient. With today s technology, multiple-benefit applications, pre-populating documents, and data sharing can help eliminate redundancy. Some California counties have adopted business process reengineering and harnessed technological innovations to determine eligibility and administer CalFresh benefits on the day of application. That level of efficiency should be the norm for all CalFresh administrators. Low-income households that receive Social Security, Earned Income Tax Credits, WIC, and other means-tested benefits could be eligible for CalFresh. The case files and personal information for these households exist in various government databases. Sharing these data with CalFresh administrators (upon receiving a household s consent) could save applicants and administrators substantial time. In-reach through data sharing has the potential to connect more eligible Californians with CalFresh benefits. Communicate the Value of CalFresh Legislative action initiated the development of the CalFresh brand in 2008 and the name CalFresh was officially established in More work remains to rebrand the public image of CalFresh. Program perception influences local, state, and federal policy decisions about CalFresh. Program perception can also significantly impact CalFresh participation, especially among seniors and working families. As new policies streamline 6

10 CalFresh enrollment and alter eligibility criteria, these changes must be effectively communicated to eligible Californians. Throughout California and the nation at large, policymakers and the public should recognize the value of CalFresh/SNAP in preventing hunger, supporting health, and providing economic stimulus. Administrators, elected officials, advocates, and community-based organizations in California should take steps to foster these perceptions by (1) highlighting the success of CalFresh in mitigating hunger and poverty; (2) embracing connections between nutrition assistance and health; and (3) articulating the positive economic impacts of CalFresh on all Californians. 7

11 County Data Tables The following tables describe the impact of CalFresh underutilization on California s local economies. As detailed in the Methodology section, these county-specific results incorporate the Program Access Index (PAI). The PAI is designed to estimate CalFresh utilization among individuals who meet three CalFresh eligibility criteria: income below 125% of the federal poverty threshold, no participation in the Food Distribution Program on Indian Reservations (FDPIR), and no receipt of Supplemental Security Income (SSI). USDA calculates a state-specific PAI that is one measure used to assess states administration of SNAP. The county-specific PAI used for this Lost Dollars, Empty Plates analysis was generated by CFPA using a methodology adapted from that of USDA. The county-specific PAI serves as the basis of the Lost Dollars, Empty Plates county-specific analysis because it helps describe county-by-county variation in CalFresh utilization. Please note that an alternate set of tables, based on USDA s statewide participation rate for CalFresh, is located in Appendix A. The methodology used to generate those tables can be found in Appendix B. Key differences in the two methodologies are summarized in the table below. Differences in Data Used to Generate LDEP Tables Data Category Tables 1, 2, and 3 CalFresh Participants Estimated Number of CalFresh-Eligible Individuals Estimated Number of Eligible Non-Participations Average Household Size for CalFresh Participants Monthly average for 2011 calendar year Program Access Index for each county 2011 Program Access Index for each county Monthly average for 2011 calendar year Tables 4, 5, and 6 (Appendix A) Most recent monthly data for statewide participation rate applied to the state & each county 2012 state participation rate applied to the state & each county Most recent monthly data for

12 Table 1 Columns B and C are based on the 2011 PAI, which assess three CalFresh eligibility criteria (income below 125% of poverty, no participation in FDPIR, and no receipt of SSI). County Column A Average Monthly CalFresh Participants Column B Estimated Number of Income-Eligible Individuals Column C Estimated Number Income-Eligible Non- Participants Alameda 114, ,714 61,710 Alpine Amador 2,880 3, Butte 27,186 44,077 16,891 Calaveras 4,693 4, * Colusa 1,679 3,938 2,260 Contra Costa 64, ,212 46,024 Del Norte 5,236 4, * El Dorado 10,994 16,681 5,687 Fresno 205, ,527 25,338 Glenn 3,303 5,774 2,471 Humboldt 14,692 23,555 8,863 Imperial 34,033 40,186 6,153 Inyo 1,799 2, Kern 133, ,629 60,558 Kings 21,963 29,475 7,512 Lake 9,258 13,791 4,534 Lassen 2,966 3, Los Angeles 1,011,051 1,709, ,836 Madera 25,298 33,024 7,726 Marin 8,644 20,138 11,494 Mariposa 1,679 2, Mendocino 12,960 15,696 2,736 Merced 50,565 63,512 12,947 Modoc 992 2,147 1,155 Mono 567 2,295 1,728 Monterey 40,116 75,448 35,332 Napa 6,869 15,742 8,873 Nevada 6,120 11,233 5,113 Orange 191, , ,

13 Table 1 Columns B and C are based on the 2011 PAI, which assess three CalFresh eligibility criteria (income below 125% of poverty, no participation in FDPIR, and no receipt of SSI). County Column A Average Monthly CalFresh Participants Column B Estimated Number of Income-Eligible Individuals Column C Estimated Number Income-Eligible Non- Participants Placer 17,175 27,650 10,475 Plumas 1,482 2,819 1,337 Riverside 240, , ,521 Sacramento 192, ,987 19,588 San Benito 6,210 7,951 1,741 San Bernardino 329, ,379 25,591 San Diego 222, , ,462 San Francisco 47,832 84,038 36,206 San Joaquin 99, ,813 21,810 San Luis Obispo 16,615 38,185 21,570 San Mateo 22,877 57,473 34,596 Santa Barbara 30,724 69,920 39,196 Santa Clara 97, ,364 68,575 Santa Cruz 20,100 39,834 19,734 Shasta 23,765 30,364 6,599 Sierra Siskiyou 5,663 8,332 2,670 Solano 37,980 42,704 4,724 Sonoma 30,077 58,687 28,610 Stanislaus 82,396 99,863 17,467 Sutter 11,204 16,600 5,396 Tehama 9,189 13,489 4,300 Trinity 1,453 2, Tulare 104, ,113 15,533 Tuolumne 5,055 7,334 2,278 Ventura 61,316 93,535 32,219 Yolo 15,645 38,463 22,818 Yuba 12,833 14,472 1,639 *The average monthly number of CalFresh participants exceeds the estimated number of income-eligible individuals resulting in a negative calculation of income-eligible non-participants. 10

14 Table 2 These data incorporate the 2011 PAI as a measure of CalFresh utilization among lowincome individuals. County Column A Estimated Additional Federal Benefits Received Annually through CalFresh Column B Estimated Resulting Increase in Annual Economic Activity Alameda $91,567,684 $163,906,155 Alpine $53,706 $96,133 Amador $1,240,397 $2,220,310 Butte $24,063,441 $43,073,559 Calaveras -$713,065* -$1,276,386* Colusa $2,677,348 $4,792,454 Contra Costa $65,654,662 $117,521,846 Del Norte -$1,200,072* -$2,148,129* El Dorado $8,668,856 $15,517,252 Fresno $31,459,242 $56,312,043 Glenn $2,921,750 $5,229,932 Humboldt $13,995,646 $25,052,206 Imperial $7,210,384 $12,906,588 Inyo $1,011,366 $1,810,345 Kern $73,639,584 $131,814,855 Kings $9,387,072 $16,802,860 Lake $6,894,685 $12,341,486 Lassen $1,084,798 $1,941,789 Los Angeles $992,642,500 $1,776,830,076 Madera $9,141,849 $16,363,909 Marin $20,814,334 $37,257,657 Mariposa $1,304,173 $2,334,471 Mendocino $4,239,136 $7,588,053 Merced $15,567,434 $27,865,706 Modoc $1,447,024 $2,590,173 Mono $3,192,168 $5,713,980 Monterey $45,755,016 $81,901,478 Napa $12,591,294 $22,538,417 Nevada $7,750,883 $13,874,081 Orange $229,692,179 $411,149,

15 Table 2 These data incorporate the 2011 PAI as a measure of CalFresh utilization among lowincome individuals. County Column A Estimated Additional Federal Benefits Received Annually through CalFresh Column B Estimated Resulting Increase in Annual Economic Activity Placer $13,960,804 $24,989,840 Plumas $1,767,189 $3,163,268 Riverside $135,369,992 $242,312,285 Sacramento $25,932,094 $46,418,448 San Benito $2,248,378 $4,024,596 San Bernardino $31,523,254 $56,426,624 San Diego $283,857,741 $508,105,356 San Francisco $71,914,832 $128,727,549 San Joaquin $26,151,012 $46,810,311 San Luis Obispo $32,912,303 $58,913,023 San Mateo $49,773,471 $89,094,513 Santa Barbara $52,155,225 $93,357,852 Santa Clara $96,077,957 $171,979,544 Santa Cruz $29,340,700 $52,519,852 Shasta $9,654,552 $17,281,648 Sierra $411,019 $735,723 Siskiyou $3,540,647 $6,337,757 Solano $6,981,932 $12,497,658 Sonoma $45,337,681 $81,154,449 Stanislaus $23,201,642 $41,530,939 Sutter $6,578,160 $11,774,907 Tehama $5,507,244 $9,857,967 Trinity $1,344,478 $2,406,615 Tulare $18,424,474 $32,979,809 Tuolumne $3,634,257 $6,505,319 Ventura $46,431,436 $83,112,271 Yolo $31,275,987 $55,984,017 Yuba $2,152,394 $3,852,786 *The average monthly number of CalFresh participants exceeds the estimated number of income-eligible individuals resulting in a negative calculation of additional benefits received and resulting economic activity. 12

16 Table 3 These data incorporate the 2011 PAI as a measure of CalFresh utilization among low-income individuals. County Column A Estimated Additional State Sales Tax Revenue (General Fund, Annual) Column B Estimated Additional State Sales Tax Revenue (non-general Fund, Annual) Column C Estimated Additional Sales Tax Revenue for Counties (Annual) Alameda $1,622,465 $1,055,890 $1,030,136 Alpine $952 $619 $242 Amador $21,978 $14,303 $8,373 Butte $426,374 $277,482 $108,285 Calaveras -$12,635* -$8,223* -$3,209* Colusa $47,439 $30,873 $12,048 Contra Costa $1,163,319 $757,080 $590,892 Del Norte -$21,264* -$13,838* -$5,400* El Dorado $153,601 $99,963 $39,010 Fresno $557,418 $362,764 $244,202 Glenn $51,770 $33,691 $13,148 Humboldt $247,985 $161,387 $62,980 Imperial $127,759 $83,145 $48,670 Inyo $17,920 $11,662 $6,827 Kern $1,304,801 $849,156 $331,378 Kings $166,327 $108,245 $42,242 Lake $122,165 $79,504 $31,026 Lassen $19,221 $12,509 $4,882 Los Angeles $17,588,384 $11,446,409 $11,167,228 Madera $161,982 $105,417 $61,707 Marin $368,804 $240,015 $163,913 Mariposa $23,108 $15,039 $8,803 Mendocino $75,112 $48,883 $21,461 Merced $275,835 $179,512 $70,053 Modoc $25,639 $16,686 $6,512 Mono $56,561 $36,810 $14,365 Monterey $810,722 $527,613 $205,898 Napa $223,102 $145,193 $84,991 Nevada $137,336 $89,377 $39,239 Orange $4,069,858 $2,648,638 $1,550,422 Placer $247,368 $160,986 $62,824 Plumas $31,312 $20,378 $7,

17 Table 3 These data incorporate the 2011 PAI as a measure of CalFresh utilization among low-income individuals. County Column A Estimated Additional State Sales Tax Revenue (General Fund, Annual) Column B Estimated Additional State Sales Tax Revenue (non-general Fund, Annual) Column C Estimated Additional Sales Tax Revenue for Counties (Annual) Riverside $2,398,587 $1,560,985 $913,747 Sacramento $459,484 $299,029 $175,042 San Benito $39,838 $25,927 $10,118 San Bernardino $558,553 $363,503 $212,782 San Diego $5,029,604 $3,273,235 $1,916,040 San Francisco $1,274,241 $829,268 $728,138 San Joaquin $463,363 $301,554 $176,519 San Luis Obispo $583,165 $379,520 $148,105 San Mateo $881,924 $573,950 $447,961 Santa Barbara $924,125 $601,415 $352,048 Santa Clara $1,702,381 $1,107,899 $918,745 Santa Cruz $519,881 $338,335 $231,058 Shasta $171,067 $111,329 $43,445 Sierra $7,283 $4,740 $1,850 Siskiyou $62,736 $40,828 $15,933 Solano $123,711 $80,510 $35,346 Sonoma $803,327 $522,800 $357,034 Stanislaus $411,104 $267,544 $117,458 Sutter $116,557 $75,854 $29,602 Tehama $97,581 $63,505 $24,783 Trinity $23,822 $15,504 $6,050 Tulare $326,459 $212,457 $124,365 Tuolumne $64,394 $41,908 $16,354 Ventura $822,707 $535,412 $208,941 Yolo $554,171 $360,651 $140,742 Yuba $38,138 $24,820 $9,686 *The average monthly number of CalFresh participants exceeds the estimated number of income-eligible individuals resulting in a negative calculation of additional tax revenue. 14

18 Methodology The following is a description of the data sources and calculations used to complete the Lost Dollars, Empty Plates analysis. This methodology is organized according to the data tables above. Table 1 Column A: Average Monthly CalFresh Participation Monthly CalFresh participation data were obtained from the California Department of Social Services DFA reports for January-December Monthly participation was averaged across the calendar year to account for any seasonal differences in CalFresh participation. Columns B and C: Estimated Number of Income-Eligible Participants and Income- Eligible Non-Participants CFPA s 2011 Program Access Index (PAI) analysis was used to identify the estimated number of income-eligible individuals and estimated number of income-eligible nonparticipants. The PAI is a county-level estimate of CalFresh utilization among lowincome individuals. The individuals included in the PAI calculation meet at least three CalFresh eligibility criteria: income below 125 percent of the federal poverty threshold, no participation in the Food Distribution Program on Indian Reservations (FDPIR), and no receipt of Supplement Security Income (SSI). b These individuals may or may not be fully eligible to receive CalFresh benefits. CFPA s PAI methodology is detailed in the Program Access Index: Measuring CalFresh Utilization by County report. 12 The formula used to calculate a county s PAI is: PAI = (CalFresh Participants) (Disaster CalFresh Program Participants) (Individuals with Income < 125% poverty) (FDPIR Participants) (SSI Recipients) In iterations of the Lost Dollars, Empty Plates report published prior to 2009, the USDAgenerated, statewide participation rate for CalFresh was applied to all counties to estimate the number of eligible non-participants. However, CalFresh participation can b Due to limitations in data available from the US Census Bureau (American Community Survey), the incomeeligible population is defined as those living below 125 percent of the federal poverty threshold, though CalFresh participants can have incomes up to 130 percent of the federal poverty guidelines. Individuals participating in FDPIR and individuals receiving SSI are ineligible to receive CalFresh benefits. 15

19 vary widely at the county level. Therefore, the statewide participation rate may not reflect the reality of CalFresh participation in many counties. Unfortunately, USDA does not calculate county-level participation rates. The PAI serves as the basis of the countylevel Lost Dollars, Empty Plates analysis because, unlike the statewide participation rate, it helps describe county-by-county variation. Table 2 Column A: Additional Federal Benefits Received Through CalFresh To calculate the value of additional federal benefits that would be received through CalFresh if participation reached 100 percent of eligible individuals, it is necessary to estimate the average monthly CalFresh benefit for eligible individuals. The average benefit that current non-participants would receive may be significantly different than the average benefit that current participants do receive. To account for the potential discrepancy, this analysis uses an estimate of the average monthly CalFresh benefits for eligible households in the 2012 fiscal year. Eligible households may or may not actually participate in CalFresh. The estimate ($253) c, which was calculated by Mathematica Policy Research, Inc., is lower than the USDA s calculation of the actual, average household benefit ($332) received by CalFresh participants for the fiscal year The average monthly benefit for eligible individuals was estimated from the average monthly benefit for eligible households using the following calculation: Estimated Household Benefit for Eligible Households Average Household Size = Estimated Monthly Benefit for Eligible Individuals Average household size is a county-specific statistic calculated with data from the 2011 CDSS DFA 256 reports 14 using the following calculation: Total Individuals Receiving Federal Benefits from January through December Total Number of Households Receiving Federal Benefits or Federal and State Benefits from January through December = Average Household Size The value of additional federal benefits received annually through CalFresh if CalFresh reached 100 percent of income-eligible individuals was estimated with the following calculation: c This estimate was calculated using the 2012 Baseline of the 2009 MATH SIPP+ model and provided directly to CFPA from Mathematica Policy Research, Inc. 16

20 Income-Eligible Individuals Not Receiving CalFresh Benefits x Average Monthly Benefit for Eligible Individuals x 12 = Additional Federal Benefits Received Annually through CalFresh with 100% Participation Among Income-Eligible Individuals Column B: Resulting Increase in Economic Activity According to USDA, every federal dollar spent on SNAP expenditures generates $1.79 in economic activity. 15 Applying this multiplier, the resulting increase in annual economic activity generated from the receipt of additional CalFresh benefits was estimated with the following formula: Additional Federal Benefits Received Annually through CalFresh x $1.79 = Increase in Economic Activity with 100% CalFresh Participation of Income- Eligible Individuals The estimate of economic stimulus generated by SNAP expenditures is based on a national analysis that examined the impact of SNAP on Gross Domestic Product (a nationwide measure of economic activity). The estimate is applied at the state and local levels for this Lost Dollars, Empty Plates analysis because no state- or county-specific estimates are currently available. Table 3 Columns A and B: Additional State Sales Tax Revenue The California Legislative Analyst s Office (LAO) reports that CalFresh benefits positively impact the state economy by freeing up household dollars for food and nonfood purchases, 45 percent of which will constitute taxable purchases: 16 Research shows that low-income individuals generally are not able to save money because their resources are spent on meeting their daily needs, such as shelter, food, and transportation. Therefore, for every dollar in food coupons that a low-income family receives, an additional dollar is available for the consumption of food or other items. Research done at the University of California and elsewhere indicates that individuals with income low enough to be eligible for food stamps would, on average, spend about 45 percent of their income on goods for which they would pay sales tax. The state General Fund receives about 5 cents for every dollar that is spent on a taxable good. Local governments and special funds receive the remainder of the sales tax revenue (generally about 2.25 percent). Because additional food coupons would result in low-income families spending more of their other resources on taxable goods, the receipt of federal food coupons helps to generate revenue for the state and for local governments. 17

21 Updating the LAO premise to reflect current sales tax rates and uses, the state general fund receives nearly four percent ($ ) of every dollar spent on taxable goods. 17 Over two percent ($ ) of each dollar spent on taxable goods is slated for nongeneral fund expenses that are under state jurisdiction. 18 Applying the LAO premise, the following calculations were used to estimate additional state sales tax revenue that would be generated if CalFresh participation included 100 percent of income-eligible individuals: Additional Federal Benefits Received Annually through CalFresh x 45% x $ Sales Tax = Additional State Sales Tax Revenue Generated Annually for the General Fund Additional Federal Benefits Received Annually through CalFresh x 45% x $ Sales Tax = Additional State Sales Tax Revenue Generated Annually for Non-General Fund Expenditures under State Jurisdiction Column C: Additional Sales Tax Revenue for Counties Because California counties/cities receive one percent of state sales tax ($0.01 of every dollar spent on taxable goods), 19 the LAO premise can be applied to estimate the impact of CalFresh benefits on county budgets. To fully account for the impact of CalFresh benefits on local economies, county-specific sales tax rates must be included in any calculations. The following formula was used to estimate the additional sales tax revenue for counties that would be generated annually if CalFresh reached 100 percent of income-eligible individuals: [(County sales tax rate - state sales tax rate) +.01] x (Additional Federal Benefits Received Annually through CalFresh x 45%) = Additional Sales Tax Revenue Generated Annually for the County County sales tax rates were taken from the January 2013 California Board of Equalization Publication These rates do not include and city- or district-specific taxes within each county. 18

22 Appendix A: Alternate Analysis The following tables describe the impact of CalFresh underutilization on California s state and local economies. These tables are based on the USDA-generated, statewide participation rate for CalFresh, not the county-specific PAI. The methodology used to generate these tables is detailed in Appendix B. Table 4 The estimated number of individuals eligible for CalFresh is based on statewide participation rate of 55 percent. County Column A Estimated Number of Eligible Individuals Column B Individual CalFresh Participants (11/12)* Column C Estimated Number of Eligible Non-Participants Statewide 7,459,015 4,102,458 3,356,557 Alameda 226, , ,937 Alpine Amador 6,065 3,336 2,729 Butte 54,120 29,766 24,354 Calaveras 9,025 4,964 4,061 Colusa 3,040 1,672 1,368 Contra Costa 125,893 69,241 56,652 Del Norte 9,516 5,234 4,282 El Dorado 21,311 11,721 9,590 Fresno 392, , ,516 Glenn 6,253 3,439 2,814 Humboldt 27,875 15,331 12,544 Imperial 67,355 37,045 30,310 Inyo 3,489 1,919 1,570 Kern 255, , ,793 Kings 41,231 22,677 18,554 Lake 18,527 10,190 8,337 Lassen 5,336 2,935 2,401 Los Angeles 2,019,655 1,110, ,845 Madera 46,713 25,692 21,021 Marin 16,815 9,248 7,567 Mariposa 3,218 1,770 1,448 Mendocino 24,491 13,470 11,021 Merced 97,771 53,774 43,997 Modoc 1,

23 Table 4 The estimated number of individuals eligible for CalFresh is based on statewide participation rate of 55 percent. County Column A Estimated Number of Eligible Individuals Column B Individual CalFresh Participants (11/12)* Column C Estimated Number of Eligible Non-Participants Mono 1, Monterey 76,156 41,886 34,270 Napa 12,784 7,031 5,753 Nevada 13,273 7,300 5,973 Orange 405, , ,558 Placer 32,227 17,725 14,502 Plumas 3,069 1,688 1,381 Riverside 498, , ,179 Sacramento 375, , ,039 San Benito 10,982 6,040 4,942 San Bernardino 666, , ,062 San Diego 453, , ,295 San Francisco 88,949 48,922 40,027 San Joaquin 197, ,359 88,657 San Luis Obispo 31,605 17,383 14,222 San Mateo 51,160 28,138 23,022 Santa Barbara 56,718 31,195 25,523 Santa Clara 193, ,237 86,921 Santa Cruz 39,107 21,509 17,598 Shasta 43,858 24,122 19,736 Sierra Siskiyou 11,107 6,109 4,998 Solano 74,444 40,944 33,500 Sonoma 61,998 34,099 27,899 Stanislaus 162,513 89,382 73,131 Sutter 21,425 11,784 9,641 Tehama 17,424 9,583 7,841 Trinity 2,920 1,606 1,314 Tulare 199, ,930 89,943 Tuolumne 9,333 5,133 4,200 Ventura 120,151 66,083 54,068 Yolo 30,195 16,607 13,588 Yuba 23,029 12,666 10,363 *Participation data for Siskiyou County reflect 10/

24 Table 5 These data incorporate the statewide CalFresh participation rate of 55 percent. County Column A Estimated Additional Federal Benefits Received Annually through CalFresh Column B Estimated Resulting Increase in Annual Economic Activity Statewide $4,659,504,588 $8,340,513,213 Alameda $155,575,404 $278,479,973 Alpine $196,236 $351,262 Amador $4,299,804 $7,696,649 Butte $35,349,804 $63,276,149 Calaveras $6,249,744 $11,187,042 Colusa $1,659,312 $2,970,168 Contra Costa $83,104,704 $148,757,420 Del Norte $6,366,492 $11,396,021 El Dorado $15,544,872 $27,825,321 Fresno $221,908,140 $397,215,571 Glenn $3,470,148 $6,211,565 Humboldt $20,021,040 $35,837,662 Imperial $36,162,072 $64,730,109 Inyo $2,369,736 $4,241,827 Kern $144,531,540 $258,711,457 Kings $23,761,944 $42,533,880 Lake $12,668,400 $22,676,436 Lassen $3,497,472 $6,260,475 Los Angeles $1,330,780,644 $2,382,097,353 Madera $25,247,376 $45,192,803 Marin $13,778,748 $24,663,959 Mariposa $2,138,724 $3,828,316 Mendocino $17,820,216 $31,898,187 Merced $54,809,460 $98,108,933 Modoc $1,055,700 $1,889,703 Mono $1,015,956 $1,818,561 Monterey $45,534,204 $81,506,225 Napa $8,311,464 $14,877,521 Nevada $9,454,104 $16,922,846 Orange $250,193,448 $447,846,

25 Table 5 These data incorporate the statewide CalFresh participation rate of 55 percent. County Column A Estimated Additional Federal Benefits Received Annually through CalFresh Column B Estimated Resulting Increase in Annual Economic Activity Placer $20,366,316 $36,455,706 Plumas $1,947,456 $3,485,946 Riverside $280,905,624 $502,821,067 Sacramento $229,931,460 $411,577,313 San Benito $6,381,396 $11,422,699 San Bernardino $386,376,264 $691,613,513 San Diego $282,035,844 $504,844,161 San Francisco $79,115,400 $141,616,566 San Joaquin $111,134,160 $198,930,146 San Luis Obispo $22,147,344 $39,643,746 San Mateo $34,100,352 $61,039,630 Santa Barbara $34,251,876 $61,310,858 Santa Clara $123,777,720 $221,562,119 Santa Cruz $27,363,744 $48,981,102 Shasta $30,001,752 $53,703,136 Sierra $382,536 $684,739 Siskiyou $6,821,064 $12,209,705 Solano $50,767,992 $90,874,706 Sonoma $45,824,832 $82,026,449 Stanislaus $100,875,240 $180,566,680 Sutter $12,223,764 $21,880,538 Tehama $10,164,528 $18,194,505 Trinity $2,031,912 $3,637,122 Tulare $111,439,692 $199,477,049 Tuolumne $6,903,036 $12,356,434 Ventura $78,981,264 $141,376,463 Yolo $19,173,996 $34,321,453 Yuba $14,022,180 $25,099,

26 Table 6 These data incorporate the statewide CalFresh participation rate of 55 percent. County Estimated Additional State Sales Tax Revenue (General Fund, Annual) Estimated Additional State Sales Tax Revenue (non- General Fund, Annual) Estimated Additional Sales Tax Revenue for Counties (Annual) Statewide $82,560,597 $53,729,912 $37,719,366 Alameda $2,756,602 $1,793,979 $1,750,223 Alpine $3,477 $2,263 $883 Amador $76,187 $49,582 $29,024 Butte $626,354 $407,627 $159,074 Calaveras $110,738 $72,067 $28,124 Colusa $29,401 $19,134 $7,467 Contra Costa $1,472,511 $958,301 $747,942 Del Norte $112,806 $73,414 $28,649 El Dorado $275,436 $179,252 $69,952 Fresno $3,931,935 $2,558,878 $1,722,562 Glenn $61,487 $40,015 $15,616 Humboldt $354,748 $230,868 $90,095 Imperial $640,747 $416,994 $244,094 Inyo $41,989 $27,326 $15,996 Kern $2,560,918 $1,666,629 $650,392 Kings $421,032 $274,005 $106,929 Lake $224,468 $146,082 $57,008 Lassen $61,971 $40,330 $15,739 Los Angeles $23,579,770 $15,345,564 $14,971,282 Madera $447,352 $291,134 $170,420 Marin $244,142 $158,886 $108,508 Mariposa $37,896 $24,662 $14,436 Mendocino $315,752 $205,489 $90,215 Merced $971,155 $632,022 $246,643 Modoc $18,706 $12,174 $4,751 Mono $18,001 $11,715 $4,572 Monterey $806,809 $525,066 $204,904 Napa $147,269 $95,842 $56,102 Nevada $167,515 $109,018 $47,861 Orange $4,433,115 $2,885,043 $1,688,

27 Table 6 These data incorporate the statewide CalFresh participation rate of 55 percent. County Estimated Additional State Sales Tax Revenue (General Fund, Annual) Estimated Additional State Sales Tax Revenue (non- General Fund, Annual) Estimated Additional Sales Tax Revenue for Counties (Annual) Placer $360,866 $234,849 $91,648 Plumas $34,506 $22,457 $8,764 Riverside $4,977,297 $3,239,193 $1,896,113 Sacramento $4,074,098 $2,651,397 $1,552,037 San Benito $113,070 $73,585 $28,716 San Bernardino $6,846,104 $4,455,401 $2,608,040 San Diego $4,997,323 $3,252,226 $1,903,742 San Francisco $1,401,826 $912,299 $801,043 San Joaquin $1,969,158 $1,281,516 $750,156 San Luis Obispo $392,423 $255,387 $99,663 San Mateo $604,216 $393,220 $306,903 Santa Barbara $606,900 $394,967 $231,200 Santa Clara $2,193,186 $1,427,312 $1,183,624 Santa Cruz $484,851 $315,538 $215,489 Shasta $531,594 $345,958 $135,008 Sierra $6,778 $4,411 $1,721 Siskiyou $120,861 $78,655 $30,695 Solano $899,545 $585,418 $257,013 Sonoma $811,959 $528,418 $360,871 Stanislaus $1,787,383 $1,163,218 $510,681 Sutter $216,590 $140,955 $55,007 Tehama $180,103 $117,210 $45,740 Trinity $36,003 $23,430 $9,144 Tulare $1,974,572 $1,285,039 $752,218 Tuolumne $122,313 $79,601 $31,064 Ventura $1,399,449 $910,753 $355,416 Yolo $339,739 $221,100 $86,283 Yuba $248,456 $161,693 $63,

28 Appendix B: Alternate Analysis Methodology The following is a description of the data sources and calculations used to complete the Lost Dollars, Empty Plates analysis using the statewide CalFresh participation rate. The methodology is organized to reflect the data tables in Appendix A. Table 4 Columns A, B, and C: Eligible Individuals Participating and Not Participating The U.S. Department of Agriculture (USDA) reports that 55 percent of eligible Californians participate in CalFresh/SNAP. 21 The following formula was used to estimate the number of individuals eligible for CalFresh: (Individuals Participating in CalFresh x 100) 55 = Individuals Eligible for CalFresh The number of current CalFresh participants was determined using monthly CalFresh participation data from the CDSS report DFA Rather than averaging the monthly participation data over an entire year, the most recently available participation data were used for this determination. Data from November 2012 were available for all counties except Siskiyou (for which October 2012 data were used). Averaging monthly participation data across an entire calendar year does account for seasonal differences in CalFresh participation. However, the statewide increase in monthly CalFresh participation since early warranted use of the most recent participation data for this analysis. The following formula was used to estimate the number of eligible individuals not participating in CalFresh: (Individuals Participating in CalFresh 0.55) x 0.45= Eligible Individuals Not Participating in CalFresh Table 5 Column A: Additional Federal Benefits Received Through CalFresh The value of additional federal benefits received annually CalFresh if CalFresh reached 100 percent of eligible individuals was estimated with the following calculation: Eligible Individuals Not Participating in CalFresh x Average Monthly Benefit for Eligible Individuals x 12 = Additional Federal Benefits Received Annually through CalFresh with 100% Participation Among Eligible Individuals 25

29 For additional details on Column A and details on Column B, please see the methodology for Table 2. Note that for Table 5, average household size is a countyspecific statistic calculated with data from the November d 2012 CDSS DFA 256 report 24 using the following calculation: Total Individuals Receiving Federal Benefits in November 2012 Total Number of Households Receiving Federal Benefits or Federal and State Benefits from in November 2012 = Average Household Size Table 6 Please see the methodology for Table 3. d Data from November 2012 were available for all counties except Siskiyou (for which October 2012 data were used). 26

30 References 1 Karen E. Cunnyngham, Mathematica Policy Research, Inc., United States Department of Agriculture Food and Nutrition Service, Reaching Those in Need: State Supplemental Nutrition Assistance Participation Rates in 2010, December Available at: 2 California Department of Social Services, Local Assistance 2012 November Estimate, page 5. Available at: 3 Karen E. Cunnyngham, Mathematica Policy Research, Inc., United States Department of Agriculture Food and Nutrition Service, Reaching Those in Need: State Supplemental Nutrition Assistance Participation Rates in 2010, December Available at: 4 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, November Accessed February 6, Available at: 5 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, November Accessed February 6, Available at: 6 United States Department of Agriculture Food and Nutrition Service, SNAP Average Monthly Benefit per Household, January Accessed February 6, Available at: 7 Kenneth Hanson, United States Department of Agriculture Economic Research Service, Economic Research Report Number 103, The Food Assistance National Input-Output Multiplier (FANIOM) Model and Stimulus Effects of SNAP, October Available at: 8 Legislative Analyst s Office, Analysis of the Budget Bill- Food Stamps Program, February Available at: 9 Mark Zandi, Assessing the Macro Economic Impact of Fiscal Stimulus 2008, Moody s Analytics, Inc., January Available at: 10 Health Access, The Affordable Care Act in California: After Two Years Big Benefits, More Work to Do, March Available at:

31 11 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, January-December Available at: 12 Tia Shimada, California Food Policy Advocates, Program Access Index: Measuring CalFresh Utilization by County. February Available at: 13 United States Department of Agriculture Food and Nutrition Service, SNAP Average Monthly Benefit per Household (FY 2012), February Accessed February 12, Available at: 14 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, January-December Accessed January 15, Available at: 15 Kenneth Hanson, United States Department of Agriculture Economic Research Service, Economic Research Report Number 103, The Food Assistance National Input-Output Multiplier (FANIOM) Model and Stimulus Effects of SNAP, October Available at: 16 Legislative Analyst s Office, Analysis of the Budget Bill- Food Stamps Program, February Available at: 17 California State Board of Equalization, Publication 71- California City and County Sales and Use Tax Rates, January 2013 Edition. Available at: 18 California State Board of Equalization, Detailed Description of the Sales & Use Tax Rate. Accessed February 12, Available at: 19 California State Board of Equalization, Publication 71- California City and County Sales and Use Tax Rates, January 2013 Edition. Available at: 20 California State Board of Equalization, Publication 71- California City and County Sales and Use Tax Rates, January 2013 Edition. Available at: 21 Karen E. Cunnyngham, Mathematica Policy Research, Inc., United States Department of Agriculture Food and Nutrition Service, Reaching Those in Need: State Supplemental Nutrition Assistance Participation Rates in 2010, December Available at:

32 22 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, October and November Accessed February 6, Available at: 23 California Department of Social Services, Administrative Division, Data Systems and Survey Design Bureau, January 2, Available at: 24 California Department of Social Services, DFA Food Stamp Program Participation and Benefit Issuance Report, January-December Accessed January 15, Available at:

33 Lost Dollars, Empty Plates The Impact of CalFresh Participation on State and Local Economies For more information about this report, please contact Tia Shimada at or ext California Food Policy Advocates Oakland Office th Street, Suite 1220 Oakland, California T: F: Los Angeles Office 205 S. Broadway Street, Suite 402 Los Angeles, CA P: F: