Electronic Benefit Transfer


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By Consumers Union on Sunday, April 1st, 2001





A new system for distribution of food stamps

and possibly cash benefits

Information Packet

April 2001



A new system for distribution of food stamps

and possibly cash benefits

  • What is EBT?

    EBT stands for Electronic Benefit Transfer. It is the new method being used

    to deliver food stamp benefits. In some counties, it will also be used to

    deliver CalWORKs, General Assistance/Relief and Refugee Cash Assistance to

    people receiving public assistance benefits.

  • How does it work?

    People receiving food stamp benefits will no longer receive food stamp coupons

    every month. Instead, they will use a plastic debit-like card and a personal

    identification number (PIN) to access their benefits and pay for their groceries,

    or to access their cash benefits (in those counties which choose EBT for cash


  • Why the change?

    EBT is part of the 1996 federal welfare reform. The federal government decided

    that food stamp coupons are too expensive to manufacture, distribute, and

    destroy. They also believed moving to an electronic system would reduce fraud.

    All states are required to change to EBT by October 2002. Although food stamp

    benefits must be converted to EBT, in California, each county has the choice

    whether to also distribute cash benefits through the EBT card.

  • Who will run the EBT system?

    The State will hire a private vendor to provide the electronic delivery of

    Food Stamp Program benefits and cash benefits. Citicorp Services, Inc. is

    the likely vendor to implement EBT in California. They have over half the

    state EBT contracts nationwide.

  • What’s happening in other


    As of October 2000, 40 states (and the California counties of San Diego and

    San Bernardino) have started using EBT to distribute food stamp benefits.

    Most of these states are using EBT for both food stamp and cash benefits distribution.

  • When does it start in California?

    EBT will be rolling out in groups of counties over the next two to four years.

    Alameda County is the pilot county for California. Alameda will start using

    EBT cards around the middle of next year (2002). Each county will have many

    important decisions to make before EBT is rolled out. The first (and perhaps

    the biggest) decision counties will have to make is whether to include cash

    benefits on the EBT card. This decision will be made by each county within

    the next several weeks.

  • Which counties will also

    use EBT for cash benefits?

    The State is giving each county the option of also distributing CalWORKs,

    GA/GR, and/or Refugee Cash Assistance benefits through the EBT card. Each

    county will soon be told how much it will cost them to use EBT for cash benefits.

    Each county will then have twelve weeks to make their decision and get back

    to the State.

    If advocates and recipients wish

    to have a say in their county’s decision about putting cash benefits on

    the EBT card, then they need to act now. Please see the suggestions under

    "What can I do?" below.

  • What are some of the advantages

    and disadvantages of putting cash benefits on EBT?

    Please see the attached table of "Cash EBT Advantages and Disadvantages."

  • What other decisions will

    counties have to make?

    • After the cash decision,

      counties will have to make several other decisions. These decisions must

      be made by each county about ten months prior to EBT rolling out in the

      given county.

    • For a list of the county decisions,

      please see the attached "County Decisions for EBT" and the "EBT

      County Options" table distributed by the State.

  • What can I do?

    • Become informed and learn more

      about EBT.

    • Tell other people and organizations

      about EBT.

    • Work with others to influence

      your county’s decisions.

    • Call your county’s EBT Primary

      County Contact person and tell him or her that you want to have a say in

      your county’s decision-making process.

For more information about the

provisions of EBT or to find out who your EBT Primary County Contact is, call

Debra Garcia of Consumers Union at (415) 431-6747 or email at GarcDe@consumer.org.










County Decision

Each county must decide within the first half of 2001 whether to distribute

CalWORKs and/or General Assistance/Relief benefits through the Electronic Benefit

Transfer (EBT) system. Recipients in counties choosing cash EBT will use an

EBT card similar to a debit card to access their cash benefits. Under EBT, the

State will hire a private vendor to run the system.

Access to Cash Benefits

  • The EBT system must provide "a

    reasonable distribution of cash access locations that are free of any fee

    to recipients."

  • The vendor must enter into an

    agreement with a major regional network of ATMs for recipients to access their

    benefits. This access is not guaranteed to be surcharge-free.

  • CalWORKs benefit availability

    to the recipient will be staggered over the first three calendar days of the

    month. General Assistance/Relief benefit availability must be staggered for

    at least three calendar days of the month, but the County may choose a longer



  • Recipients will have four cash

    withdrawals without a fee from the vendor.

  • The EBT system must provide a

    "reasonable distribution" of cash access locations that are free

    of any fee to recipients. At other locations, the ATM or POS owner may charge

    a fee.

  • Retailers may charge a fee for

    purchases or purchases with cash back only if the retailer customarily charges

    other debit card users.

Amount of Withdrawals

  • Recipients will be able to make

    a withdrawal of at least $200 per transaction.

  • Full withdrawal of cash benefits

    in one transaction is not guaranteed, but it may be provided. There may be

    a surcharge.

  • Retailers may limit the amount

    of cash back with a purchase.

Cash Access Plan

  • The vendor must prepare a Cash

    Access Plan for every county that chooses EBT for cash benefits.

  • The vendor is required to "work

    closely" with the State and County Welfare Departments to develop the

    cash access plans.

  • The vendor and County Welfare

    Departments are expected to consult with community organizations.

  • Non-traditional cash access locations

    such as utility companies, housing authority offices and other community locations

    may be a part of the plan.

  • The vendor must provide the State

    with a County Cash Access Plan for each county choosing cash EBT five months

    before the county is scheduled to convert to EBT.

Lost or Stolen Cards

  • A 24-hour hotline will be available

    to report lost or stolen cards.

  • Recipients will be fully liable

    for benefits stolen using their card and PIN until the card is reported lost

    or stolen. Recipients will not have the same protections bank card users have.

  • A lost or stolen card will be

    replaced within three business days after reporting.

Keeping Track of Balances

  • A recipient’s balance should

    be printed on each transaction receipt.

  • Balances can be checked by phone

    at no charge.

  • Balances can be checked at ATMs

    with a possible surcharge.

  • No monthly statements will be

    issued. The cardholder can call the hotline to get the past ten transactions

    by phone or to request a mailed two month transaction history.


  • Where will recipients be able

    to withdraw their cash benefits?

  • Will a recipient be able to withdraw

    the full amount of their cash benefits at one time?

  • How effective will community

    input be in influencing the locations for no-fee cash withdrawals?

For further information on the

provisions of EBT, please call Debra Garcia at Consumers Union at (415) 431-6747

or e-mail at GarcDe@consumer.org.






Fees and budgeting  
May reduce fees to recipients currently using check cashing

services to get their cash benefits; recipients will have four free cash

withdrawal transactions per month of at least $200, at selected ATMs or

POS machines

May increase cost for recipients to access their benefits

if they do not use designated free locations; after the first four cash

withdrawals, recipients will have to pay a fee to the contractor and may

have to pay a fee to the ATM or POS owner

Allows recipients to make incremental withdrawals against

their monthly benefits amount

Recipients will have to request that the CWD reinstate their

benefits if not accessed in 90 days; benefits are lost if not claimed within

270 days

Recipients can make cash withdrawals at participating ATMs Recipients may have to pay a surcharge fee to use ATMs (plus

they must pay a fee to the contractor after the first four cash withdrawals

per month)

Recipients may be able to withdraw all of their funds in one

transaction (this has not yet been decided)

Recipients may have to pay a surcharge fee to withdraw all

of their benefits at one time (this has not yet been decided)

Balances can be checked by phone at no charge; each transaction

receipt will print the remaining balance

No monthly statements will be provided; balance inquiries

at an ATM will probably have a fee

Increases familiarity with the technology of the commercial

banking system

Benefits on a lost or stolen card cannot be accessed by anyone

who does not know or guess the PIN

Benefits stolen from a lost or stolen card before it is reported

will not be replaced; the recipient must report the card lost or stolen

to a toll-free number as soon as possible to protect his or her benefits

Increases safety because recipients will not have to carry

large sums of cash; purchases can be made using the EBT card

May be charged a fee to make purchases, but only if the business

also charges other debit card holders such a fee

Counties are expected to consult with advocates as they work

with the contractor to decide (along with the contractor) where the no fee

locations will be for cash withdrawals

Potential for poor cash access because the cash access plans

will be drafted after the county has already decided to use EBT for cash


Three day staggering for CalWORKs recipients in Los Angeles

County, rather than the current 10 day staggering

Unless a county obtains a waiver from the State, three day

staggering for cash benefits even in counties which do not stagger now

  Creates privacy concerns because the government can track

where recipients are accessing their benefits

  May create obstacles and reduce financial independence of

some disabled, elderly, and homebound recipients


Individual California counties have

many options that affect the transition to this new means of food stamp and

possibly cash assistance benefit delivery.

The following serve as brief examples

of some the decisions that counties will make and therefore are areas in which

advocates and recipients might influence the EBT system.

County Decisions about Food Stamp


  • Will recipients receive their

    new cards, PINs, and all training information by mail or will any of these

    steps occur in person at designated locations?

  • If the county chooses to mail

    out the cards, there will be walk-in training centers. Where will they be

    located? How many will there be?

  • If cards are issued in person,

    where will this take place – at a central county office, district offices

    or at other locations?

  • If a recipient loses a card,

    will he or she receive a replacement by mail (which can take three business

    days) or immediately at a county office?

  • In which languages will training

    materials be provided?

  • Which community-based organizations

    will receive free training about EBT?

County Decisions about Cash Benefit Implementation

Unlike food stamps where the transition

to EBT is federally mandated, California counties have to chose whether or not

recipients will receive their cash benefits on this same card. If a county chooses

cash EBT, many of the decisions that counties make regarding the transition

of food stamps coupons are the same for cash. In addition to the questions listed

above under food stamp implementation, there are some other county options for


  • Will the county choose to distribute

    cash benefits through EBT?

  • Which cash benefits will be distributed

    by EBT? CalWORKs, GA/GR and/or Refugee Cash Assistance?

The county and the state will

work closely with the vendor to decide another key issue:

  • Where will recipients be able

    to access their cash benefits free of charge?

For further information on the

provisions of EBT, please call Debra Garcia at Consumers Union at (415) 431-6747

or e-mail at GarcDe@consumer.org

The following table provides

a list of the high level options as described in the EBT ITP that each county

has in regards to the implementation of EBT.






(When decisions must be finalized)

Cash Decision Will the county utilize EBT to issue cash benefits?

Will county utilize EBT to issue GA/GR benefits?

Prior to EBT Contract execution
Cash Stagger Will the county request a waiver of the cash stagger requirement

from CDSS?

County Readiness Phase
  How will cash benefits be staggered? (case number, case name,

application date …)

County Readiness Phase
  How and when will clients be notified of the cash stagger? Planning and Installation Phase
Conversion Methodology Will conversion be mail-based or will cards be issued over-the-counter? County Readiness Phase
  If conversion is mail-based, which locations would be best

for walk-in training centers?

County Readiness Phase
  If conversion is over-the-counter, which locations would be

best for conversion sites?

County Readiness Phase
  How will the county convert homeless cases? Planning and Installation Phase
Conversion Staging How will conversion be staged in the county? (% of caseload;

geographically; small portion of caseload first month followed by remaining

caseload over the following two months…)

Planning and Installation Phase
On-going Card Issuance Methodology Will on-going card issuance be mail-based, over-the-counter

or a combination?

County Readiness Phase
  If mail-based, where will PIN selection equipment be located? County Readiness Phase
  If cards are issued over-the-counter, where will card issuance

sites be located?

County Readiness Phase
  How and where will the county issue cards for emergency case

situations (immediate need and expedited services)

County Readiness Phase
Card Issuance Timing When will EBT cards be issued to recipients – at the time

of application or after eligibility is established?

County Readiness Phase
Replacement Card Issuance How will replacement EBT cards be issued – over-the-counter

or via the mail?

County Readiness Phase
  If over-the-counter, what locations will be utilized for card


County Readiness Phase
Food Stamp Coupon Conversion Will the county issue food stamp coupons to recipients who

move out of the EBT area or will the county have the EBT Contractor mail

coupons to the requesting recipient?

County Readiness Phase

updated 3/6/01

2 responses to “Electronic Benefit Transfer”

  1. roy carrillo says:

    i got a,ebt card an pay food stamps how can i recieve my plastic debit card an how long have i been getting my,snap ebt for

  2. lot for sale salitran says:

    After I initially commented I seem to have clicked on the -Notify me when new comments are added- checkbox and now whenever a comment is added I receive 4 emails with the same comment. Is there an easy method you are able to remove me from that service? Cheers!


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