Fresh Start Grants: Personal Income Tax Law: credits.

Assembly Member McKinnor's Fresh Start Grants Program legislation transforms California's approach to delivering financial assistance by converting three existing tax credits into direct grant payments administered through county welfare departments. Beginning January 2027, eligible CalFresh recipients will receive grants equivalent to the California Earned Income Tax Credit, Young Child Tax Credit, and Foster Youth Tax Credit amounts they would have claimed on their tax returns.

The bill establishes the Fresh Start Grants Fund in the State Treasury to finance these payments, with the Franchise Tax Board annually estimating needed funding levels and transferring amounts from the Tax Relief and Refund Account. County welfare departments will calculate grant amounts, verify eligibility, and distribute payments to recipients. The departments must also evaluate participants in other state safety net programs like CalWORKs and Medi-Cal for grant eligibility.

To protect recipient privacy, particularly for undocumented individuals, the legislation mandates comprehensive data security protocols including encryption, access controls, and breach notification requirements. The California Privacy Protection Agency will conduct regular compliance audits and investigate any violations. The State Department of Social Services must commission an independent evaluation of the program's impact on poverty reduction, participation rates, and administrative efficiency, with reports due 18 months after implementation and by June 2030.

The bill reduces the existing tax credits by any Fresh Start Grant amounts received, preventing duplicate benefits while maintaining overall assistance levels. County welfare departments must notify recipients of any overpayments due to administrative error and may deduct excess amounts from future grants, with appeal rights for disputed claims.