Food Stamp Program Is Reauthorized

Program’s Supporters Score Major Victory

June 1, 2002

Author: Barbara Weiner

Last fall, two proposals for reauthorization of the Food Stamp Program (FSP) emerged — one from the House and one from the Senate, each a title of the much larger Farm Bill.  The House passed its version first, in October, with provisions penned primarily by that body’s more conservative majority.  Nevertheless, though the bill contained no restoration of food stamp program eligibility for immigrants, it did contain authorization for a transitional food stamp program and made several other welcome changes in the program’s operation, at a cost of slightly more than $3 billion in additional budgetary authorization.  The Senate’s food stamp proposal, which passed the Senate in February of this year, was substantially more generous, providing more than $8 billion in additional funding authorization for the program. Among its provisions was a significant restoration of food stamp benefits to legal immigrants.
Over the last few months, reconciliation of the differences between the House and Senate Farm Bills, including the Nutrition Titles reauthorizing the Food Stamp Program, was the task of a Conference Committee made up of representatives from both houses.  In spite of some last ditch efforts by conservative House members to thwart immigrant restorations, the final Conference Agreement on the 2002 Farm Bill largely adopted the immigrant provisions in the Nutritional Title of the Senate Farm Bill.  On May 2, 2002, the House passed the Farm Bill Conference Report.  The Senate followed suit on May 8, 2002, and the President signed the legislation on May 13, 2002. 
 
The cost of the amendments to the Food Stamp Program made in the final bill, called the Food Stamp Reauthorization Act of 2002, has been estimated by the Congressional Budget Office to be $6.4 billion — not quite as much as the Senate was prepared to authorize, but a good deal more than the House version had proposed. The authorization of appropriations for food stamps is extended through FY 2007.
 
Restoration of Benefits to Immigrant Children, Disabled Immigrants, and Immigrants Who Have Been in the U.S. for Five Years
 
By far the most hotly contested issue between the House and Senate was the restoration of food stamp benefits to legal immigrants.  The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) had erected what was essentially a permanent bar to program access against immigrants coming to the United States after PRWORA enactment.  Even pre-enactment immigrants were affected, with only children, disabled immigrants, and elderly immigrants who were at least 65 years old on August 22, 2002, remaining eligible. The eligibility of humanitarian immigrants like refugees and asylees was limited to seven years. Only legal permanent residents with a significant work history and immigrants serving in the armed forces, or who had been honorably discharged, and their families remained eligible for food stamps without restriction. 

The Food Stamp Reauthorization Act of 2002 (the Reauthorization Act) changes the permanent bar to a five-year bar, consistent with the immigrant eligibility restrictions in other federal means-tested benefit programs, including the Temporary Assistance to Needy Families program (TANF) and federally-funded Medicaid/Child Health. It goes further than that, though, removing the five-year waiting period altogether for lawful resident children and immigrants who meet the food stamp program’s definition of disabled. 
 
The effective date of the Reauthorization Act’s various immigrant provisions has been staggered, presumably to lower the final cost.  To be eligible for benefits, immigrants must of course continue to meet PRWORA’s definition of “qualified” immigrant.  Qualified immigrants include lawful permanent residents, refugees, asylees, Cuban/Haitian entrants, Amerasians, persons whose deportation has been withheld, conditional entrants, persons granted parole for at least one year, and certain victims of domestic violence. 
 
The effective dates of the immigrant eligibility restorations are as follows:

• October 1, 2002: Qualified immigrants who meet the Food Stamp Program definition of disability become eligible for food stamps, regardless of their date of entry (to be considered “disabled” under food stamp law requires that the person be in receipt of disability assistance under one of several programs, including SSI, veteran’s disability benefits, and/or disability-related Medicaid); 
• April 1, 2003: All legal immigrants, after five years of residence in the United States in a qualified status become eligible for benefits (in effect, this will nullify the current seven-year limit on the eligibility of refugees, asylees, and other immigrants in humanitarian classifications); and lastly 
• October 1, 2003: All qualified immigrant children become eligible for food stamps without having to wait five years and without deeming being applied.

In April of next year, when eligibility for food stamp benefits will be restored to all qualified immigrants who have been in the United States for at least five years, the 40 quarter work exemption currently in place will become irrelevant as far as eligibility for food stamp benefits is concerned.  However, the 40 quarter work history determination will still be relevant with respect to deeming and sponsor liability.  Once a sponsored immigrant is credited with 40 quarters of work under the Social Security system, the sponsor is no longer liable for support.  At that point, deeming of the sponsor’s income in determining the immigrant’s eligibility for federal means-tested benefits terminates, and the sponsor will no longer be liable for the repayment of benefits the immigrant may use.

State Options

The reauthorized food stamp program contains several state options, all of them, without exception, of benefit to food stamp households.  The effective date of these options is October 1, 2002.  States may begin implementing them at any time thereafter.
 
The Transitional Benefit Option [7 USC § 2011(s)]
 
Of particular importance is the state option to give households leaving the cash assistance program five months of transitional food stamp benefits.  A three-month transitional program had already been established by the United States Department of Agriculture (USDA) as a state option in final regulations published in November of 2000.  New York State implemented the option in December of last year.  (See the December 2001 issue of the LSJ: “Good News for New York’s Food Stamp Recipients”.)  Inclusion of the transitional program in the Reauthorization Act now provides statutory authority for the program.  In addition, the statute increases the transitional period from three to five months and permits the states to postpone any scheduled recertification that would otherwise fall within the transitional period to the end of the period.
 
The transitional benefit amount is equal to the amount of food stamps the household received in the month immediately preceding the closing of the cash assistance case, adjusted for the change in household income as a result of the loss of cash assistance.  The effective date of the transitional benefit option is October 1, 2002.
 
Child Support Income Exemption [7 USC § 2014(d)(6) and (e)(4)]
 
The Reauthorization Act amends food stamp law to allow states to treat legally obligated child support payments made by a member of the food stamp household for the support of a non-household member as an income exclusion rather than deduction.  This allows the states to subtract the child support payments being made by a household before determining whether the household’s income meets the gross income limit of the food stamp program (130% of the federal poverty line). 
 
When, as currently, child support payments are treated as a deduction rather than an exclusion, some households with gross income exceeding the standard are barred from access to food stamps even though they might actually be eligible for benefits if their child support payments were taken into account.
 
Simplification of the Standard Utility Allowance [7 USC § 2014(e)(7)(C)(iii)]
 
Food stamp law permits the states, in calculating the food stamp grant to which a household is entitled, to elect to use Standard Utility Allowances (SUA) rather than the household’s actual costs.  (New York permits households to choose which form of the deduction the household prefers, though the state’s standard allowances are sufficiently generous that it is likely that few, if any, households choose the actual cost option.)  Now, the Reauthorization Act has made it more attractive for states to use the standard allowances.
 
A state that mandates the use of the Standard Utility Allowances no longer has to pro-rate the SUA between households living together and sharing expenses.  If the households have qualifying utility costs, each household is entitled to the full Standard Utility Allowance deduction. This is the case regardless of whether one or both households receive food stamp benefits.   In addition, states that mandate the use of the Standard Utility Allowance may, for the first time, provide a SUA deduction to households that live in public housing with central metering who pay excess utility charges for heating and/or cooling. 
 
The budgeting of pro-rated utility allowances has historically been a fertile field for quality control errors by the states. The elimination of the pro-ration requirement for states that adopt the mandatory use of the Standard Utility Allowance should make this option particularly attractive to the states.  In states like New York, with adequate standard allowances, it is also likely to be of significant benefit to food stamp households.
 
Reduction of Household Reporting Requirements [7 USC § 2015(c)(1)]
 
The Reauthorization Act gives states the option to adopt semi-annual income reporting requirements for all their food stamp households, not just those with earned income as is currently allowed pursuant to USDA regulations.  Under semi-annual reporting, food stamp households would only be required to report changes in income and other circumstances at six month intervals unless their income exceeds the program’s gross income limit (130 percent of the federal poverty line). 
 
Freezing Deductions between Certifications [7 USC § 2014(f)(1)]
 
States are permitted to disregard certain changes in household circumstances that would otherwise require a recalculation of benefits, for example, a reduction in the cost of childcare or housing costs.  States that choose this option will still not be able to disregard a reported change of residence or, under standards that are set by the USDA, changes in earned income.
 
Standard Homeless Excess Shelter Deduction [7 USC § 2014(f)(1)]
 
The Reauthorization Act allows states to deduct a flat $143 a month in excess shelter costs for households in which every member is homeless as long as the household is not receiving free shelter throughout the month.  The states can refuse to provide this deduction to homeless households with extremely low shelter costs.
 
Indexing the Standard Deduction, Raising the Resource Limit for Households with Disabled Members, and Other Amendments
 
An amendment that does not have much of an immediate impact on benefits but that will become more important as the years go by is the Reauthorization Act’s indexing of the standard household deduction to household size.  Under current law, all households, regardless of size, get a flat $134.  Beginning on October 1st, the standard deduction for food stamp households will be calculated at 8.31% of each year’s inflation-adjusted poverty level for that household size. Households with more than six members receive the deduction for a six-member household. 
 
No household will receive less than the current standard deduction of $134 a month. Establishing this as a floor was critical because, with current poverty levels, a household must have at least five members to experience any benefit from the new rule.  Households of four or fewer members would actually have seen a reduction in their standard deduction were the new formula to be applied to their food stamp budget.
 
The Reauthorization Act also conforms the resource test for households with disabled members to the current test for households with elderly members by raising the resource limit for households with a disabled member to $3,000.  The resource limit for households with neither elderly nor disabled members remains at $2,000.
 
Of great importance to the states, the Reauthorization Act reforms the quality control system significantly.  As a result, only states that have persistent problems would be subject to penalties.  Although only the state agencies themselves are directly affected by this change, food stamp applicants and recipients may experience an indirect benefit because quality control issues and the risk of federal penalties were often cited by the states as a major contributing factor in the states’ overly bureaucratic and unnecessarily restrictive administration of the food stamp program.  A relaxation of the quality control system may help to open up access to the food stamp program to more low-income families.
 
One change that was proposed by the Senate that unfortunately did not make it to the final bill was liberalization of the time-limited eligibility imposed on “able bodied adult without dependents.”  Thus, advocates in New York must continue to focus on modifying the State’s implementation of the time limit.  Much could be done to improve the access of unemployed, childless households to the food stamp program in New York if the State required, rather than simply authorized, the local districts to implement the federal time limit waivers that are granted yearly to areas experiencing high unemployment.  The State should also mandate the utilization of the 15% hardship exemptions in districts not eligible for the waiver.  With these two simple reforms, no unemployed, childless adult in New York should end up with only three months of food stamp benefits every three years.
 
There are a number of other provisions in the Reauthorization Act dealing primarily with emergency food assistance, the reauthorization of commodity programs, farmers’ markets, etc. that are not touched on here.  A complete outline of the Reauthorization Act’s provisions is available on the website of the Center on Budget and Policies at http://www.cbpp.org/.
 
A Food Stamp Footnote in House TANF Reauthorization Bill
 
Unfortunately this Food Stamp story cannot end on an entirely happy note.  On May 14, 2002, the House passed its TANF Reauthorization Bill (H.R. 4737).  (See the article on TANF reauthorization in this issue.) A provision in that bill that has raised a great deal of concern is one giving the Executive almost unfettered authority to grant “superwaivers” to the states.  These waivers would allow the states to fundamentally alter the rules in a whole host of federal programs, including the food stamp program. Under this proposal, the Secretaries of Health and Human Services, Agriculture, Education, Labor, and Housing and Urban Development could approve waivers altering statutory and regulatory provisions related to the Food Stamp Program, the Child Care and Development Fund, public housing, job training, and homelessness programs, among others. 

The proposal was first unveiled by the White House in February.  Since that time, it has gone through several modifications, in large part to alleviate the objections of even some conservative House members who felt that the superwaiver proposal represented an intolerable encroachment on Congressional authority.  The House-passed bill thus includes provisions that prohibit Executive approval of waivers that would shift funding from one federal program to another or that override funding restrictions in program appropriation or authorization bills.  However, the bill makes it clear that these provisions do not bar waivers of program requirements, including those governing eligibility standards, application procedures, and the benefits or services that a program provides.
 
The superwaiver provision is encountering strong opposition in the Senate and from advocates representing the interests of low-income families. Advocates have warned that cash-strapped states could use federal funds in ways never contemplated by Congress, including by replacing state funding for some low-income programs with federal funds and thus freeing up state funds to fill other budget holes.
 
The House TANF bill threatens the Food Stamp Program in one additional way, and that is by providing up to five states with an opportunity to receive food stamp funding as a block grant.  Bi-partisan supporters of the food stamp program managed to stave off an attempt to block grant the food stamp program in 1996 when PRWORA was passed. In spite of the severe cuts the program suffered at that time, it remained an entitlement program.  During this latest round of reauthorization debates and proposals, the block granting of the food stamp program was never even raised. Now, after everyone breathed a sigh of relief that the food stamp program made it through the reauthorization process so well and remains an entitlement program with a national benefit structure and uniform eligibility standards, it is being threatened by stealth, through provisions obscured in legislation that is not about food stamps at all.