Amendments	Fiscal Memos
HA0139	Amendment 1-0 to HB0119

	Amendments	Fiscal Memos
SA0022	Amendment 1-1 to SB0244

NOTE: Each fiscal memorandum applies only to the amendment(s) identified in the memorandum. The fiscal memorandum must be matched to any amendments that have been adopted.

Fiscal Summary

Increase State Expenditures - $13,600/One-Time $182,200/Recurring Other Fiscal Impact - Civil penalties collected as a result of violations by persons and business entities will be deposited in the Public Assistance Integrity Fund. Money deposited in the fund will be allocated to the Department of Human Services (DHS) and the district attorneys to offset any costs incurred due to the provisions of the bill. It is unknown how many violations may occur and how much funding will be collected as a result. It is estimated that any fiscal support by the Fund will be in future fiscal years. Implementation of this bill could jeopardize $9,576,200 in federal funds. According to the DHS, the restrictions on assistance spending and EBT transactions in the proposed legislation are broader in scope than the federal restrictions enacted by the Middle Class Tax Relief and Job Creation Act of 2012. According to the DHS, under 42 U.S.C. § 609 the Department of Health and Human Services (HHS) will impose a five percent penalty on the state family assistance grant if the state is in violation of federal law. According to the HHS website, the penalty will be imposed on the fiscal year following a final decision by HHS.

Bill Summary

This bill prohibits any recipient of public assistance benefits from using any such benefits for the purchase of any alcoholic beverage, tobacco product, or lottery ticket. Under this bill, "public assistance benefits" means money or property provided to eligible persons through the temporary assistance to needy families program or, to the extent permitted by federal law, other programs of the federal government, the state, or any political subdivision thereof, and administered by the department of human services. Additionally, this bill prohibits a recipient of public assistance benefits from withdrawing or using benefits by means of an electronic benefit transfer transaction for the purchase of goods or services in a retail establishment that primarily sells tobacco products, a tattoo facility, a facility providing psychic services, an adult cabaret, or an establishment open to the public where alcoholic beverages are served for consumption on the premises. To the extent permitted by federal law, any person who violates the above prohibitions must reimburse the department for the purchase and would be subject to the following sanctions:

(1) Upon the first violation, the person would be disqualified from receiving public assistance benefits by means of direct cash payment or an electronic benefits transfer access card for one month;
(2) Upon the second violation, the person would be disqualified from receiving public assistance benefits by means of direct cash payment or electronic benefits transfer access card for three months; and
(3) Upon a third or subsequent violation, the person would be permanently disqualified from receiving public assistance benefits by means of direct cash payment or an electronic benefits transfer access card.

A person who is disqualified from receiving public assistance benefits as described above would have the right to a hearing pursuant to the Uniform Administrative Procedure Act.

This bill prohibits any person or business entity, or any agent or employee thereof, from accepting public assistance benefits held on an electronic benefit transfer card for the purchase of any alcoholic beverage, tobacco product, or lottery ticket. Any person or business entity who violates this prohibition would be subject to a civil penalty of $100 for a first violation, $500 for a second violation within five years, or $1,000 for a third or a subsequent violation within five years. Additionally, the district attorney general may bring an action to suspend the business licenses and permits of the person or business entity for one year for any such violation. The moneys collected from such civil penalties would be deposited into the public assistance integrity fund, which is established by this bill, for use by the department and the appropriate district attorney general for costs associated with the prevention of misuse of public assistance benefits. Any revenues deposited in this fund would remain in the fund until expended for such purposes.

ON FEBRUARY 25, 2013, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 244, AS AMENDED.

AMENDMENT #1 rewrites the bill to instead prohibit a recipient of public assistance benefits from knowingly using an electronic benefits transfer card in a liquor store; a casino, gambling casino, or gaming establishment; or an adult cabaret, including the use of such card in an automated teller machine or point-of-sale device in such a store or establishment. To the extent permitted by federal law, any person who violates this bill must reimburse the department for the purchase.

Additionally, this bill prohibits any person or business entity, or any agent or employee of the person or business entity, from knowingly accepting public assistance benefits from an electronic benefits transfer card for the purchase of any goods or services in a liquor store; a casino, gambling casino, or gaming establishment; or an adult cabaret. Any person or business entity who knowingly violates this prohibition would be subject to the following civil penalties:
(1) $1,000 for the first violation;
(2) $2,500 for the second violation within five years; and
(3) $5,000 for a third or a subsequent violation within five years.

A person or entity subject to a penalty or sanction under this bill would have the right to a hearing conducted pursuant to the Uniform Administrative Procedure Act (UAPA). Any revenues from the above civil penalties would be deposited into the general fund.

The district attorney general may bring an action to suspend the business licenses and permits of the person or business entity for one year for any violation of such prohibition. The department may bring an action to enforce any civil penalty described above in a complaint filed in the chancery court of the county where the merchant is located.

The department must establish a system for reviewing electronic benefit transactions of recipients pursuant to this bill.

For rulemaking purposes this bill would take effect on becoming law, and for all other purposes, it would take effect on July 1, 2014.