New Food Stamp Cuts on the Horizon Again

Another session of Congress. Another chapter in the perils to SNAP (the food stamp program), as Congress tries again to pass a new Farm Bill.

Last week, the Senate Agriculture Committee finished a bill that cuts the program by $4.1 billion over the next 10 years. This is slightly less than last year’s proposed cut, but only because the Congressional Budget Office’s estimate has changed.

The House Agriculture Committee boosted its food stamp cuts to approximately $21 billion* over the same 10-year period. This $4.5 billion increase over last year reflects substantive changes in the proposed legislation.

Senate Agriculture Committee’s Cut

The Senate Agriculture Committee decided again to impose a restriction on a provision commonly known as “heat and eat.”

As things stand now, states can give households the maximum allowance for household utility costs if they receive any benefit from the Low Income Home Energy Assistance Program.

In some, but not all cases, this entitles them to a larger food stamp benefit because it reduces their adjusted income.

The Senate Agriculture Committee’s bill would restrict “heat and eat” to households that receive more than $10 a year from LIHEAP — directly or as a payment to their utility company.

CBO earlier estimated that this change would reduce benefits for nearly 500,000 households by an average of $90 a month.

Since then, sequestration has cut LIHEAP funding by nearly $270.8 million — this on top of cuts totaling $1.6 billion since Fiscal Year 2010.

So the 15 states and the District of Columbia that now use the “heat and eat” option will be hard put to protect all beneficiaries from benefits cuts, but not as hard put as under the House Agriculture Committee’s bill.

House Agriculture Committee’s Cuts

Last year, the House Agriculture Committee’s Farm Bill adopted the same “heat and eat” restriction as the Senate’s.

Its new bill raises the minimum LIHEAP benefit required to $20 in any given year. This would increase the number of households affected to about 850,000, according to CBO estimates reported by the Center on Budget and Policy Priorities.

Most of House Agriculture’s food stamp savings, however, come from a restriction it would again impose on an option known as categorical eligibility.

At this point, states can, in some cases, use the same gross income and asset limits for food stamp eligibility as they use for programs they fund out of their Temporary Assistance for Needy Families block grant or funds they spend to meet their maintenance-of-effort requirement.

The alternative cut-offs may be used for households that receive any TANF-funded benefit or service, as well as those that receive cash assistance from the Supplemental Security Income program or a state general assistance program.

They enable some low-income people — mainly working families and seniors — to receive food stamp benefits although the standard gross income and/or asset limit would disqualify them.

These are hardly people who don’t need food assistance, as CBPP explains.

A working family may have a gross income higher than 130% of the federal poverty line, but far less than the FPL after allowable costs are deducted.

A senior may have somewhat more than $3,250 in retirement savings to supplement a Social Security benefit that leaves him/her well below the FPL, as would be the case for a former minimum wage worker.

So-called broad-based categorical eligibility, i.e., eligibility based on receipt of any TANF benefit, enables people like these to receive food stamps.

All but 10 states use it to ease the standard, very restrictive asset maximum — $2,000, except for seniors. Fourteen states and the District use it to allow a somewhat higher gross income as well.

The House Agriculture Committee eliminates broad-based categorical eligibility by restricting cat-el to households that receive cash assistance from TANF or one of the other aforementioned programs.

CBO has estimated that 1.8 million fewer low-income people would receive food stamp benefits. The Office of Management and Budget put the figure at 3 million.

CBO also estimates that 210,000 children wouldn’t get free school meals any more because their eligibility depends on their family’s participation in the food stamp program.

So they’d be doubly deprived — as would their parents, who’d have to pay for all their kids meals, as well as their own.

The House Agriculture Committee’s bill also cuts funding for the nutrition education program that’s part of SNAP.

The $274 million cut would come on top of a $110 million cut Congress made in January — this to offset the costs of averting a milk price spike that would otherwise have resulted from its failure to pass a Farm Bill last year.

So families who don’t get dumped out of the food stamp program will get less help in learning how to make healthy food choices they can afford.

This is already a challenge. But it will soon get harder, even without any new “heat and eat” restriction, because earlier raids on the food stamp program will reduce benefits for all participants at the end of October.

To top off the savings, the House Agriculture Committee eliminates the bonuses USDA has been awarding states for outstanding performance and notable improvements in key aspects of program administration.

The bipartisan National Conference of State Legislatures told the Committee last year that the bonuses had proved effective, noting that the payment error rate was at a record low.

But the Committee’s bill would end them anyway, just as last year’s bill would have.

So we’ve got two very different bills — and an upcoming battle royal in the House.

What the end result of all this will be is anybody’s guess.

What’s clear, however, is that House Agriculture Committee Chairman Frank Lucas is spinning his bill when he says that it “won’t take a calorie off the plate of anyone who needs help.”

Even the Senate Ag Committee’s Farm Bill would. And it’s not nearly so bad.

* The somewhat smaller figure you may have read elsewhere is the total for all the changes that have budgetary impacts in the Nutrition title of the Farm Bill . Modest increases for The Emergency Food Assistance Program and several other items account for the difference.

Senate Passes Major Bipartisan Bill With Harmful Food Stamp Cut

The Senate has achieved a modern-day miracle. It has passed a second major piece of legislation — and on a bipartisan basis too.

The legislation is the Agriculture Reform, Food and Jobs Act of 2012, i.e., the Farm Bill. It’s the source of, among other things, a variety of subsidies for farm businesses and of the policies that govern SNAP (the food stamp program).

Like all such federal laws, it’s supposed to be reauthorized every five years. This year is one of them.

Anti-hunger advocates are not happy because the Senate bill changes a provision commonly known as “heat and eat,” which states have used to boost food stamp benefits.

The provision allows states to use their maximum standard utility allowance when they deduct allowable costs from income if the household receives a LIHEAP (Low Income Home Energy Assistance Program) benefit.

The maximum SUA can make households eligible for food stamps and/or make them eligible for higher benefits than their actual out-of-pocket energy costs would.

It works this way because they qualify for a higher deduction when their shelter costs reach 50% of their income, less other deductions. This so-called excess shelter deduction is capped for most households, but not for those with an elderly or disabled family member.

The benefits boost seems to be what Congress intended, i.e., to keep low-income households from having to choose between staying warm and having enough food on the table.

What apparently got some members of the Senate Agriculture Committee upset is that a number of states have been giving applicants a token LIHEAP benefit — sometimes, as in the District of Columbia, a $1 a year.

How many states do this is unclear. Committee Chair Debby Stabenow (D-MI) says 16 states do.

A recent Congressional Research Service memo says that a preliminary survey indicates that 14 states and the District have implemented or will soon implement “heat and eat.”

In any event, the Committee decided that states are exploiting a loophole which ought to be closed. Or perhaps it just saw a good opportunity to save an estimated $4.5 billion by 2022.

So the bill it produced would restrict the “heat and eat” option to cases where the annual LIHEAP benefit is at least $10 a year.

The House budget reconciliation bill, i.e., the Republican majority’s alternative to sequestration, would blow away “heat and eat” altogether, saving close to $14 billion over the same 10-year time period.

One can see, I think, why some members of Congress could decide that the provision, as written, allows states to “game the system,” as House Agriculture Committee Chairman Frank Lucas (R-OK) claims.

But — and it’s a big but — eliminating “heat and eat,” as House Republicans want, would reduce benefits for 1.3 million households, according to the Congressional Budget Office.

Nearly 500,000 households would get lower benefits under the less radical change in the Senate’s Farm Bill.

In both cases, the average per household benefits loss would be $90 a month — this on top of the 10% or so benefits loss already enacted.

Low-income seniors and people with disabilities would be hardest hit because of the uncapped shelter cost deduction I mentioned.

The Food Research and Action Center warns that some could be left with only the minimum food stamp benefit — a pathetic $16 a month.

What’s so upsetting about this latest raid on the food stamp program is that benefits are already well below what most families need for a healthful diet. We’ve got ample evidence of this, including:

• Reports on individuals’ experiences with the Food Stamp Challenge — even some from members of Congress.
• Local studies showing how far benefits fall short of covering the U.S. Department of Agriculture’s cheapest food plan.
• USDA’s latest food security survey, which found that 52% of households that received food stamps year round didn’t always have the resources to buy “enough food for an active, healthy life.”

States have adopted “heat and eat” in part because they recognize the benefits problem. Also because food stamps deliver a great “bang for the buck” to their economies — thus create and preserve those jobs we need so badly now.

The Senate could have done the same, but chose not to when it defeated, also on a bipartisan basis, an amendment that would have kept “heat and eat” intact.

Now the $4.5 billion saved becomes the starting point for negotiations with the House.

The Republican majority there has already passed vastly larger food stamp cuts. So it’s unlikely to settle for even its own “heat and eat” savings.