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California bill would educate EBT clients about approved uses, fees for payment cards

As proposed, the legislation doesn't seek to limit or abolish surcharges. The concern is that, if enacted, it might later be leveraged to introduce restrictions.

August 7, 2014

California legislators are giving consideration to a bill that, according to its author, Senator Mark Stone, "seeks to improve consumers’ access to information about their EBT transactions and to facilitate their economic empowerment," according to a Stateside Alert provided by the ATM Industry Association.

Stone's bill would require that electronic benefits transfer recipients under the CalWorks program have the ability to use or withdraw benefits using their EBT card with minimal fees or charges, including an opportunity to access benefits with no fee or charges.

Existing law authorizes a transaction fee — set by state and federal entities — to be charged for cash withdrawals by the EBT cardholder, and also specifies that the cardholder be allowed four fee-free transactions per month.

Assembly bill No. 1614 does not seek to change or disallow fees, but rather, to help card recipients understand how fees are charged; how (and where) their card is to be used; and provide them access to a transaction history, said Stone.

The measure's requirements — which include a 24-hour free hotline and a website, among other services — were determined to have a "significant fiscal impact." It has been placed on the "suspense file" for further consideration, including a feasibility study.

ATMIA US Executive Director David Tente commented on the legislative proposal:

Looking through the summaries, as well as the bill itself, I don’t see any immediate impact on the ATM industry. The primary intention appears to be that of up setting up a state-mandated, local program to help facilitate EBT usage. Our primary concern would be that at some point in the future, regulators would use the authority of this bill to restrict how surcharges are applied to EBT card transactions.

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ATM Industry Association (ATMIA)

The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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